Dennis Kucinich speaks about secret congress meeting!!! (video)

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Democracy Now!
Mar 14, 2008

House Holds Rare Secret Session on Spy Bill

The House of Representatives postponed a vote on a spy bill Thursday after Democrats agreed to a request from Republicans to hold a rare secret session to discuss what they termed classified security matters. It marked the first time a secret session was held in a quarter of a century and only the sixth time in the House’s history. We speak with Ohio Congressmember Dennis Kucinich, who refused to attend the secret session. [includes rush transcript]

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Dennis Kucinich speaks about secret congress meeting!!!

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EFF Applauds House Passage of Surveillance Bill with No Telecom Immunity

Debate about Secret Session in House of Representatives (videos)

Debate about Secret Session in House of Representatives Part 2 (videos)

Dennis Kucinich: You Can’t Secure Our Nation With LIES!

Kucinich-Dennis

Contribute to Kucinich for Congress

Winter Soldier: Iraq & Afghanistan 2008 (audio link)

Winter soldier testimonials + Hart Viges (videos)

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EFF Applauds House Passage of Surveillance Bill with No Telecom Immunity

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After Downing Street
Mar 14, 2008
For this release:
http://www.eff.org/press/archives/2008/03/14

Bill Would Allow Spying Cases to Proceed Fairly and Securely

Washington, D.C. – This morning the House of Representatives passed a compromise surveillance bill that does not include retroactive immunity for phone companies alleged to have assisted in the NSA’s warrantless wiretapping program. The bill would allow lawsuits like the Electronic Frontier Foundation’s case against AT&T to proceed while providing specific security procedures allowing the telecom giants to defend themselves in court.

The House bill succeeded 213 to 197 despite the president’s threat to veto any bill that does not include immunity.

“We applaud the House for refusing to grant amnesty to lawbreaking telecoms, and for passing a bill that would allow our lawsuit against AT&T to proceed fairly and securely,” said Electronic Frontier Foundation (EFF) Senior Staff Attorney Kevin Bankston. “Amnesty proponents have been claiming on the Hill for months that phone companies like AT&T had a good faith belief that the NSA program was legal. Under this bill, the companies could do what they should have been able to do all along: tell that story to a judge.”

The Senate is expected to consider the House bill when it returns from recess on Monday, March 31. House and Senate staff are expected to spend much of the break negotiating over differences between the new House bill and a previous Senate bill that includes immunity provisions.

“This newly-passed House bill represents a true compromise on the amnesty issue: customers whose privacy was violated would get their day in court, while the companies would be allowed to defend themselves despite the Administration’s broad demands for secrecy,” said EFF Legal Director Cindy Cohn. “We look forward to assisting the Senate in its consideration of this compromise solution, which EFF believes is the only reasonable response to the White House’s attempt to evade court review of its illegal spying program and the phone companies’ collaboration in it.”

EFF represents the plaintiffs in Hepting v. AT&T, a class-action lawsuit brought by AT&T customers accusing the telecommunications company of violating their rights by illegally assisting the National Security Agency in widespread domestic surveillance. The Hepting case is the leading case aimed at holding telecoms responsible for knowingly violating federal privacy laws with warrantless wiretapping and the illegal transfer of vast amounts of personal data to the government.***

Hoyer, Conyers, Reyes Applaud House Passage of the FISA Amendments Act

After Downing Street
Mar 14, 2008WASHINGTON, DC – House Majority Leader Steny H. Hoyer (MD), House Judiciary Committee Chairman John Conyers, and House Intelligence Committee Chairman Silvestre Reyes applauded today’s passage of the FISA Amendments Act, which passed the House 213-197.

“I am proud that the House passed thoughtful, appropriate legislation today that addresses the needs of the intelligence community without abandoning the ideals and principles upon which our nation was founded,” Hoyer said. “I look forward to continued discussions with the Senate and an expedient resolution on a final product. I hope our Republican colleagues will finally join us at the negotiating table, so we can complete work on this critical legislation.”

“I applaud my colleagues for supporting a bill that is sensible and responsible policy and strikes the appropriate balance between the government’s need to protect our citizens from foreign attack, and our citizens’ right to be free from unreasonable searches and seizures,” Conyers said. “I look forward to sending a bill to the President’s desk that maintains this very important balance and I encourage the President to support our efforts.”

“The U.S. House today passed responsible legislation that arms our intelligence community with powerful new tools to keep us safe and restores essential constitutional protections for Americans that were sharply eroded when the President signed the Protect America Act into law last August,” said Reyes. “We have put the security of Americans first and foremost. We will continue to work to move this forward in a manner that provides for both our nation’s security and liberty.”

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Debate about Secret Session in House of Representatives (videos)

Debate about Secret Session in House of Representatives Part 2 (videos)

A New “Red Scare” From Washington by Eric Margolis

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by Eric Margolis
March 12, 2008

WASHINGTON: For old timers like me who miss the Cold War, Washington’s increasingly heated rhetoric over China and various other malefactors brought back piquant memories of the bad old days.

The US Department of Defense warned last week, `China threatens the stability of Asia.’ Defense Secretary Robert Gates criticized the 17.6% increase in China’s 2008 military budget ads dangerous and provocative.

China’s official military budget is $58.8 billion, but the real figure is estimated at around $110 billion. Beijing’s claims its hike in defense spending were solely to boost military pay were believed by no one. Even so, Washington’s warning was pretty rich coming from the sole superpower that spends ten times more on its military than China – a nation with four times the US population.

Secretary Robert Gates unblushingly accused China of `lack of transparency’ in concealing major defense programs. Talk about the pot calling the kettle black. Some 25-30% of the Pentagon’s trillion-dollar budget is believed to be hidden in secret `black’ projects, or concealed in other government departments. The US intelligence community’s budget alone is 40% of China’s total military and intelligence spending.

…continued

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FBI Found to Misuse Security Letters By Dan Eggen

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By Dan Eggen
ICH
Washington Post Staff Writer
03/14/08 “Washington Post

2003-06 Audit Cites Probes of Citizens

The FBI has increasingly used administrative orders to obtain the personal records of U.S. citizens rather than foreigners implicated in terrorism or counterintelligence investigations, and at least once it relied on such orders to obtain records that a special intelligence-gathering court had deemed protected by the First Amendment, according to two government audits released yesterday.

The episode was outlined in a Justice Department report that concluded the FBI had abused its intelligence-gathering privileges by issuing inadequately documented “national security letters” from 2003 to 2006, after which changes were put in place that the report called sound.

A report a year ago by the Justice Department’s inspector general disclosed that abuses involving national security letters had occurred from 2003 through 2005 and helped provoke the changes. But the report makes it clear that the abuses persisted in 2006 and disclosed that 60 percent of the nearly 50,000 security letters issued that year by the FBI targeted Americans.

…continued

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Stunning New Report on Domestic NSA Dragnet Spying Confirms ACLU Surveillance Warnings

Fed Judge Rules Parts of Patriot Act Unconstitutional By Manila Ryce

The U.S. Military’s Assassination Problem By David Case

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By David Case
Mother Jones
March/April 2008 Issue

in 2004, when an American missile fired from a Predator drone killed Taliban leader Nek Mohammed, an observer told a journalist that the bombing was so exact it “didn’t damage any of the buildings around the lawn where Mohammed was seated.” It was an endorsement, if ever there was one, of the Bush administration’s post-9/11 efforts at assassinations using what are known as decapitation attacks.

The practice, which is shrouded under a veil of intense secrecy, is generally regarded as warfare’s answer to laser surgery: clean and accurate, cheaper than waging a protracted ground battle, and less risky for American troops. But in reality, these premeditated and narrowly focused air bombings often fail to kill their intended foe and hit civilians instead. “It’s much more difficult to hunt people with a 2,000-pound bomb than people realize,” says Marc Garlasco, who until 2003 was one of the Pentagon’s leading analysts of air strikes, including assassinations.

During the invasion of Iraq, Garlasco’s job was to analyze targets with an eye toward minimizing collateral damage using a software program called Bugsplat. Days after Baghdad fell, Garlasco, intent on examining firsthand the military’s success or failure in sparing civilians, accepted a position with Human Rights Watch (hrw) and traveled to Iraq to do just that. Among the sites he studied was a Basra neighborhood where the United States dropped bombs meant for Lt. General Ali Hassan al-Majid—nicknamed Chemical Ali because of his role in gassing tens of thousands of Kurds. Garlasco had watched the bull’s-eye attack live on video transmitted from a Predator drone. “We cheered when the bomb went in,” he says.

But Chemical Ali survived, and witnesses told Garlasco that they’d never seen him in the targeted location. As part of his investigation for hrw, the analyst met a 50-year-old laborer whose home was destroyed in the attack, killing seven family members. He found that 10 neighbors had also died. “When I stood in the crater and I was talking to the survivors,” Garlasco says, “it wasn’t so cool anymore.”

…continued

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FOX Attacks! Obama (videos)

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bravenewfilms

FOX Attacks! Obama

http://foxattacks.com/ Fox News Channel does it again. Their antics remain unfair and biased.

Added: February 21, 2007

FOX Attacks! Obama – Part 2

http://foxattacks.com

Fox News is up to their old smear tactics. They “reported.” We decided you had to see for yourself.

Added: March 14, 2008

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FOX Attacks! Obama Staffer (video)

Obama Interview + Obama’s Pastor Problems + Sharpton compares Obama’s Pastor to Billy Graham

Winter soldier testimonials + Hart Viges (videos)

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TheRealNews

Friday March 14th, 2008

Iraq Veterans Against the War (IVAW) hold press conference in Washington, DC

This month, for four days in Washington, DC, beginning on March 13, there will be a second Winter Soldier gathering — 37 years after the first. Organized by the protest group Iraq Veterans Against the War (IVAW), US veterans of Iraq and Afghanistan since the 9/11 attack on New York will testify about their experiences.

They will present photographs and videos, recorded with mobile phones and digital cameras, to back up their allegations — of brutality, torture and murder.

The veterans are not against the military and seek not to indict it — instead they seek to shine a light on the bigger picture: that the Abu Ghraib prison regime and the Haditha massacre of innocent Iraqis are not isolated incidents perpetrated by “bad seeds” as the military suggests, but evidence of an endemic problem. They will say they were tasked to do terrible things and point the finger up the chain of command, which ignores, diminishes or covers up routine abuse and atrocities.

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Debate about Secret Session in House of Representatives Part 2 (videos)

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Part 1 here: Debate about Secret Session in House of Representatives (videos)

CSPANJUNKIEdotORG

March 13, 2008 C-SPAN

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Dennis Kucinich: You Can’t Secure Our Nation With LIES!

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Contribute to Kucinich for Congress

Mosaic News – 3/13/08: World News from the Middle East

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Warning

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This video may contain images depicting the reality and horror of war and should only be viewed by a mature audience.

linktv

For more: http://linktv.org/originalseries
“Islamic Leaders Meet in Senegal,” Al Jazeera TV, Qatar
“Iran Elections: A Litmus Test for Ahmadinejad?” Al Arabiya TV, UAE
“Israel Retaliates,” IBA TV, Israel
“Wall Threatens Wild Life in West Bank,” Al Arabiya TV, UAE
“Israel & US Do Not Have Same Agenda,” ANB TV, England
“Two Sisters Killed By Israeli Missiles,” Al Aqsa, Gaza
“Car Bomb Attack on US Convoy in Kabul Kills Civilians,” Al Jazeera English, Qatar
“Syria Lashes Out At US,” Syria TV, Syria
Produced for Link TV by Jamal Dajani.

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The $200 billion bail-out for predator banks & Spitzer charges are intimately linked By Greg Palast

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By Greg Palast
After Downing Street
Reporting for Air America Radio’s Clout
Listen to Palast on Clout at www.GregPalast.com
Mar 14, 2008

While New York Governor Eliot Spitzer was paying an ‘escort’ $4,300 in a hotel room in Washington, just down the road, George Bush’s new Federal Reserve Board Chairman, Ben Bernanke, was secretly handing over $200 billion in a tryst with mortgage bank industry speculators.

Both acts were wanton, wicked and lewd. But there’s a BIG difference. The Governor was using his own checkbook. Bush’s man Bernanke was using ours.

This week, Bernanke’s Fed, for the first time in its history, loaned a selected coterie of banks one-fifth of a trillion dollars to guarantee these banks’ mortgage-backed junk bonds. The deluge of public loot was an eye-popping windfall to the very banking predators who have brought two million families to the brink of foreclosure.

Up until Wednesday, there was one single, lonely politician who stood in the way of this creepy little assignation at the bankers’ bordello: Eliot Spitzer.

Who are they kidding? Spitzer’s lynching and the bankers’ enriching are intimately tied.

How? Follow the money.

The press has swallowed Wall Street’s line that millions of US families are about to lose their homes because they bought homes they couldn’t afford or took loans too big for their wallets. Ba-LON-ey. That’s blaming the victim.

Here’s what happened. Since the Bush regime came to power, a new species of loan became the norm, the ‘sub-prime’ mortgage and it’s variants including loans with teeny “introductory” interest rates. From out of nowhere, a company called ‘Countrywide’ became America’s top mortgage lender, accounting for one in five home loans, a large chuck of these ‘sub-prime.’

Here’s how it worked: The Grinning Family, with US average household income, gets a $200,000 mortgage at 4% for two years. Their $955 a month payment is 25% of their income. No problem. Their banker promises them a new mortgage, again at the cheap rate, in two years. But in two years, the promise ain’t worth a can of spam and the Grinnings are told to scram – because their house is now worth less than the mortgage. Now, the mortgage hits 9% or $1,609 plus fees to recover the “discount” they had for two years. Suddenly, payments equal 42% to 50% of pre-tax income. Grinnings move into their Toyota.

Now, what kind of American is ‘sub-prime.’ Guess. No peeking. Here’s a hint: 73% of HIGH INCOME Black and Hispanic borrowers were given sub-prime loans versus 17% of similar-income Whites. Dark-skinned borrowers aren’t stupid – they had no choice. They were ‘steered’ as it’s called in the mortgage sharking business.

‘Steering,’ sub-prime loans with usurious kickers, fake inducements to over-borrow, called ‘fraudulent conveyance’ or ‘predatory lending’ under US law, were almost completely forbidden in the olden days (Clinton Administration and earlier) by federal regulators and state laws as nothing more than fancy loan-sharking.

But when the Bush regime took over, Countrywide and its banking brethren were told to party hardy – it was OK now to steer’m, fake’m, charge’m and take’m.

But there was this annoying party-pooper. The Attorney General of New York, Eliot Spitzer, who sued these guys to a fare-thee-well. Or tried to.

Instead of regulating the banks that had run amok, Bush’s regulators went on the warpath against Spitzer and states attempting to stop predatory practices. Making an unprecedented use of the legal power of “federal pre-emption,” Bush-bots ordered the states to NOT enforce their consumer protection laws.

Indeed, the feds actually filed a lawsuit to block Spitzer’s investigation of ugly racial mortgage steering. Bush’s banking buddies were especially steamed that Spitzer hammered bank practices across the nation using New York State laws.

Spitzer not only took on Countrywide, he took on their predatory enablers in the investment banking community. Behind Countrywide was the Mother Shark, its funder and now owner, Bank of America. Others joined the sharkfest: Goldman Sachs, Merrill Lynch and Citigroup’s Citibank made mortgage usury their major profit centers. They did this through a bit of financial legerdemain called “securitization.”

What that means is that they took a bunch of junk mortgages, like the Grinnings, loans about to go down the toilet and re-packaged them into “tranches” of bonds which were stamped “AAA” – top grade – by bond rating agencies. These gold-painted turds were sold as sparkling safe investments to US school district pension funds and town governments in Finland (really).

When the housing bubble burst and the paint flaked off, investors were left with the poop and the bankers were left with bonuses. Countrywide’s top man, Angelo Mozilo, will ‘earn’ a $77 million buy-out bonus this year on top of the $656 million – over half a billion dollars – he pulled in from 1998 through 2007.

But there were rumblings that the party would soon be over. Angry regulators, burned investors and the weight of millions of homes about to be boarded up were causing the sharks to sink. Countrywide’s stock was down 50%, and Citigroup was off 38%, not pleasing to the Gulf sheiks who now control its biggest share blocks.

Then, on Wednesday of this week, the unthinkable happened. Carlyle Capital went bankrupt. Who? That’s Carlyle as in Carlyle Group. James Baker, Senior Counsel. Notable partners, former and past: George Bush, the Bin Laden family and more dictators, potentates, pirates and presidents than you can count.

The Fed had to act. Bernanke opened the vault and dumped $200 billion on the poor little suffering bankers. They got the public treasure – and got to keep the Grinning’s house. There was no ‘quid’ of a foreclosure moratorium for the ‘pro quo’ of public bail-out. Not one family was saved – but not one banker was left behind.

Every mortgage sharking operation shot up in value. Mozilo’s Countrywide stock rose 17% in one day. The Citi sheiks saw their company’s stock rise $10 billion in an afternoon.

And that very same day the bail-out was decided – what a coinkydink! – the man called, ‘The Sheriff of Wall Street’ was cuffed. Spitzer was silenced.

Do I believe the banks called Justice and said, “Take him down today!” Naw, that’s not how the system works. But the big players knew that unless Spitzer was taken out, he would create enough ruckus to spoil the party. Headlines in the financial press – one was “Wall Street Declares War on Spitzer” – made clear to Bush’s enforcers at Justice who their number one target should be. And it wasn’t Bin Laden.

It was the night of February 13 when Spitzer made the bone-headed choice to order take-out in his Washington Hotel room. He had just finished signing these words for the Washington Post about predatory loans:

“Not only did the Bush administration do nothing to protect consumers, it embarked on an aggressive and unprecedented campaign to prevent states from protecting their residents from the very problems to which he federal government was turning a blind eye.”

Bush, said Spitzer right in the headline, was the “Predator Lenders’ Partner in Crime.” The President, said Spitzer, was a fugitive from justice. And Spitzer was in Washington to launch a campaign to take on the Bush regime and the biggest financial powers on the planet.

Spitzer wrote, “When history tells the story of the subprime lending crisis and recounts its devastating effects on the lives of so many innocent homeowners the Bush administration will not be judged favorably.”

But now, the Administration can rest assured that this love story – of Bush and his bankers – will not be told by history at all – now that the Sheriff of Wall Street has fallen on his own gun.

A note on “Prosecutorial Indiscretion.”

Back in the day when I was an investigator of racketeers for government, the federal prosecutor I was assisting was deciding whether to launch a case based on his negotiations for airtime with 60 Minutes. I’m not allowed to tell you the prosecutor’s name, but I want to mention he was recently seen shouting, “Florida is Rudi country! Florida is Rudi country!”

Not all crimes lead to federal bust or even public exposure. It’s up to something called “prosecutorial discretion.”

Funny thing, this ‘discretion.’ For example, Senator David Vitter, Republican of Louisiana, paid Washington DC prostitutes to put him diapers (ewww!), yet the Senator was not exposed by the US prosecutors busting the pimp-ring that pampered him.

Naming and shaming and ruining Spitzer – rarely done in these cases – was made at the ‘discretion’ of Bush’s Justice Department.

Or maybe we should say, ‘indiscretion.’

***
Greg Palast, former investigator of financial fraud, is the author of the New York Times bestsellers Armed Madhouse and The Best Democracy Money Can Buy.

Hear The Palast Report weekly on Air America Radio’s Clout.

And next Wednesday March 19, join Palast and Clout host Richard Greene on a dinner cruise on the Potomac River. For more information click here.

And this Sunday, at noon, on WABC-TV New York, catch Amy Goodman, Les Payne and Greg Palast on Like It Is with Gil Noble.

FAIR USE NOTICE: This blog may contain copyrighted material. Such material is made available for educational purposes, to advance understanding of human rights, democracy, scientific, moral, ethical, and social justice issues, etc. This constitutes a ‘fair use’ of any such copyrighted material as provided for in Title 17 U.S.C. section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use’, you must obtain permission from the copyright owner.

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Forget Spitzer, fire Bernanke By Chan Akya

Predatory Lenders’ Partner in Crime by Former NY Gov Eliot Spitzer

Roubini’s Nightmare Scenario; A Vicious Circle Ending In A Systemic Financial Meltdown By Mike Whitney

Massive solar plant weans NV off of expensive fossil fuels

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LCVheatison

The world’s third-largest solar power plant outside Las Vegas helps to wean Nevada off of coal- and natural gas-powered electricity, which will become more expensive with a cap on carbon dioxide emissions. The plant, which produces zero emissions, generates enough capacity to power 14,000 homes.

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Hallmarks of a “hit job” ordered from the very top: Forget Spitzer, fire Bernanke

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by Chan Akya
Global Research, March 14, 2008
Asia Times
Mar 15, 2008

There must be something about men achieving power that exposes them to frequent misuses of authority. In particular, infidelity seems a particular curse for the powerful across the world. This week’s events involving the governor of New York, Eliot Spitzer, may however have helped to hide a more egregious misuse of authority, namely that of Federal Reserve chief Ben Bernanke and his central banking cohorts around the world.

In another one of those nice coincidences that seem to happen whenever Wall Street is down and out, the unpopular governor of New York was found consorting with prostitutes through a Federal investigation that has all the hallmarks of a “hit job” ordered from the very top. Spitzer was deeply unpopular in the corridors of power, and especially with the current Treasury Secretary Hank Paulson, for daring to take various Wall Street firms down a few notches earlier this decade.

After also hitting other sacred cows such as large insurance companies, Spitzer was readying ammunition to strike at the heart of the current subprime crisis by attacking the monoline insurers and rating agencies. It is almost too convenient that the disclosures of his extracurricular activities came this week. Still, let us take everything said at face value and not attempt to conjecture any conspiracy behind all this.

People in Europe and Asia always find curious the preoccupation of Americans with sex, especially as the country appears to look askance at acts of immeasurable violence. This has been the formula for Hollywood – nary a nipple in sight but more than a few torsos getting blown to smithereens.

Be that as it may, the focus of the Spitzer case on two separate legal areas, namely using a prostitute and secondly for potential money laundering, both appear strangely exaggerated in the rest of the world. So the guy was having sex with a hooker; that’s essentially a problem between the married couple rather than being subject of intense public debate. Spitzer is said to have been neither crooked nor incompetent.

If anything, his personal use of prostitutes may have contradicted his public crusade against brothels and pimps. In essence, Spitzer had to resign because he was a hypocrite. Reading that line, perhaps a few of you would wonder as I did about the implications of other politicians around the world being asked to resign for being hypocritical. Nope, I couldn’t think of anyone who’d survive that either.

Sleight of hand

The sorry story of the governor and his extramarital affair though helped to achieve something much more important, namely to hide a brewing problem in the securities industry.

On Monday, when the Federal Reserve announced a new facility to help banks finance themselves by posting previously unacceptable collateral, stock and credit markets jumped for joy. That is, until someone started asking slightly cute questions on the lines of just who was in so much trouble that the Fed had to rush through an ill-prepared intervention.

As with the Sherlock Holmes dictum of “who benefits from the crime”, it is clear that this week’s moves were intended to help beleaguered brokers. While it is perhaps impossible to speculate just which company is in most trouble because of poor disclosure and the use of opaque valuation techniques, the most important brokers whose failure would have systemic implications include the likes of Bear Stearns, Lehman Brothers, Merrill Lynch and Morgan Stanley. Coming as it does so close to the expected announcement of first-quarter earnings (most brokers close their financial year in November, hence their first quarter ends February), the fear being expressed on the street was that it had to be one of the bigger firms as otherwise the Fed would not have bothered.

Brokers hold billions of dollars in the very securities that are suddenly eligible for refinancing with the Fed, such as mortgages and other securities that have proven well nigh impossible to sell to investors for the past few months. This has spilt over into the rest of the financial system, hurting various cities and towns across the US as they try to refinance themselves. That in turn must have gotten the government and its central bank all hot under the collar.

At this stage perhaps readers will be wondering why I implied a crime had taken place on Wall Street when all that seems to have happened is that a central banker has tried to quietly save one of the large financial firms in its backyard. The answer is a little more complicated than that, and touches upon the curiously ignored principles of central banking.

Walter Bagehot, the patron saint of central bankers, suggested the following basic principles for central banks to help the banks under their supervision to avoid liquidity runs.

A. Only lend against good collateral to avoid losses for taxpayers at a later date.
B. Lend at extremely high interest rates to avoid the facility being used willy-nilly by greedy bankers.
C. Make public the availability of such facilities, so as to prevent doubts and suspicions in the minds of depositors and other creditors.

This week’s announcement by the Fed violates EVERY one of those principles. Firstly, the collateral being accepted by the Fed is tainted as the market’s complete lack of appetite (at any price) for the securities shows. By providing the ability to liquefy these securities, the Fed has effectively signaled that it would accept just about any junk.

Secondly, the cost of borrowing is not punitive; indeed it is agreeably low for anyone who cares to fill out a couple of forms. Thirdly, this facility was not used previously; therefore the market has been in some doubt about really how useful it could be.

In essence, this is a US$200 billion facility that is being misapplied to rescue a specific part of the financial system at a preferential rate, and without any disclosure required on usage. Given all this, it is impossible for anyone to expect that the ultimate cost of this facility will not be borne by US taxpayers.

In my last article on Europe (Euro-trash, Asia Times Online, March 11, 2008) I pointed to the failures of the European Central Bank, which similarly violated the Bagehot principles when widening the range of acceptable collateral and lowering the discount rate made available to banks at the refinancing window. The Fed has entered into an arrangement that is eerily similar to that of the European Central Bank, whose actions have resulted in parts of the European financial system essentially becoming “zombie” companies, ie dead but still walking around.

From where I sit, it appears that Bernanke has opened a whole new can of worms in his efforts at maintaining the structural integrity of the US financial system. The financial means used are clearly at odds with what Americans have preached to the rest of the world, including Asia following its 1997 crisis.

To that extent, it is clear that Bernanke suffers from a similar complex to Spitzer, ie that rules do not apply to them because of magical exclusions that are self-derived. Once we decide that both have committed acts that are essentially illegal, it then becomes a question of gauging just who committed the worse crime.

Spitzer through his actions hurt his family and a small band of friends very badly. That however pales in comparison to the wide-ranging systemic damage being wrought by Bernanke through his ill-considered actions. The wrong government official resigned this week.

The CRG grants permission to cross-post original Global Research articles on community internet sites as long as the text & title are not modified. The source and the author’s copyright must be displayed. For publication of Global Research articles in print or other forms including commercial internet sites, contact: crgeditor@yahoo.com

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