Wednesday, June 8, 2016

Deadly Legacy: Obama, Biden, Paul Ryan and GOP Financial Terrorists’ Anti-Poverty Plan and Deregulating Wall Street

Speaker of the House Paul Ryan and his band of GOP financial terrorists are devising an anti-poverty plan to address the crushing poverty, illness, ignorance and starvation that has resulted from the Paul Ryan budgets of 2011 and 2014.  The plan unveiled by House Republicans claims to attack poverty “at its roots” by rewarding work and improving school programs.  The GOP tough love program would “stiffen” work requirements tied to welfare programs.

What the tone deaf Ryan fails to recognize is that the roots of poverty lie in his budgets, which amount to financial terrorist attacks on the American people.  The 2014 budget plan that took effect in 2015 slashed $4.8 trillion from social programs designed to help low and moderate income Americans.  From the Center on Budget and PolicyPriorities:


Ryan Plan Gets 69 Percent of Its Budget Cuts From Programs for People With Low or Moderate Incomes

House Budget Committee Chairman Paul Ryan’s new budget cuts $3.3 trillion over ten years (2015-2024) from programs that serve people of limited means.  That’s 69 percent of its $4.8 trillion in total non-defense budget cuts…  House Budget Committee Chairman Paul Ryan’s new budget cuts $3.3 trillion over ten years (2015-2024) from programs that serve people of limited means.  That’s 69 percent of its $4.8 trillion in total non-defense budget cuts…

These cuts are in addition to the discretionary and entitlement cuts imposed by the 2011 Budget Control Act’s (BCA) budget caps and sequestration… The $3.3 trillion figure includes:

·        More than $2.7 trillion in health care reductions for low- and moderate-income people.
·        $137 billion in cuts to SNAP (formerly food stamps). 
·        Up to $125 billion in cuts to Pell Grants.
·        More than $16 billion from eliminating the Social Services Block Grant (SSBG).
·        At least $150 billion in cuts in unspecified mandatory programs serving low-income Americans.
·        About $160 billion, and maybe more, in cuts to low-income non-defense discretionary (NDD) programs.

In March of this year, Ryan met with Vulture Capitalist Paul Singer and other Republican donors to set the Republican Agenda for the upcoming year.  According to Politico the secretive two-day conclave headed by hedge-fund manager Paul Singer called the “American Opportunity Alliance” included the richest pro-business GOP donors in the country. Activities included panels on economic and security policies.

Paul Singer is one of the hedge-fund managers who stand to make a killing off the Puerto Rico financial crisis, so it is curious that two months after that soiree Ryan and the GOP unveil their plan to “save” Puerto Rico.  From The Nation:


No, Paul Ryan, Austerity Will Not Fix the Starving Puerto Rican Economy

House Republicans want to let an unelected “control board” impose brutal cuts on people who have already suffered enough.

Led by House Speaker Paul Ryan … they have promoted the worst sort of austerity economics (tax breaks for billionaires in combination with proposals to undermine Social Security, Medicare, Medicaid, food stamps, and unemployment benefits)… the folly of austerity is confirmed each day—in states governed by Republican governors who seek to balance budgets by assaulting public employees, public education, and public services…

Ryan and his fellow Republicans have been cobbling together a legislative proposal to create an unelected control board that could trump the will of the people of Puerto Rico and impose draconian cuts. That’s a recipe for economic and social turmoil…  “This undemocratic board would have the power to slash pensions, cut education and health care, and increase taxes on working families in Puerto Rico…

The White House complains about the “mean spirited policy-making” of the Republicans who have advanced this measure. Yet aides say the president (and many congressional Democrats) could accept the plan if there is no other option for assisting Puerto Rico.

Paul Ryan has served his financial benefactor well.  And as Paul Ryan and his bloody band of financial terrorists serve Puerto Rico up on a platter to the vultures, Ryan cohort Jeb Hensarling is heading up the effort to derail the Dodd-Frank Act and dismantle the Consumer Financial Protection Bureau.  Undoing Dodd-Frank happens to be another item on the Paul Singer wish list.  From Trailblazers blog:


Dallas Rep. Jeb Hensarling to push for fewer restrictions on banks in Dodd-Frank overhaul

With his Financial Choice Act, the Texas Republican wants to do away with the Volcker Rule, which restricts a bank’s ability to make risky speculative investments; increase congressional oversight of independent regulatory agencies; exempt banks with certain capital levels from parts of the law and slap heftier fines on banks for fraud and other financial misconduct…

Hensarling — one of seven powerful House committee chairmen from Texas – has tried for years to chip away at the measure, which was passed in the wake of the housing crisis and is aimed at increasing oversight of the nation’s most powerful banks…

Hensarling wants to rename the consumer protection bureau and place it under the control of a bipartisan, five-member commission — instead of a single director…

The presumptive Democratic candidate for President, Hillary Clinton has the only viable plan to address the Federal Reserve Bank and Wall Street Banks.  According to Michael Maiello at Rolling Stone Magazine:


Why It's a Big Deal Hillary Clinton Plans to Shake Up the Fed

Clinton has a chance to achieve radical, lasting financial reform

Hillary Clinton is taking on the United States Federal Reserve System, but in a wonky, bottom's-up way that shows her understanding of a complex and widely misunderstood organization. This is not "End the Fed" or even "audit the Fed" — she wants to rebuild it from its fundamentals at the regional level.

Hillary Clinton's recent proposal to change the roster of Fed officials who ultimately make monetary policy and regulatory decisions might be the most effective Fed-reform idea since the financial crisis…  The Federal Reserve was set up in 1917, in the wake of a financial crisis, as a private national bank that could serve as lender of last resort to other banks… 

The Fed is run by a seven-member board in Washington, D.C., and a dozen regional bank presidents based in financial centers throughout the country (New York, St. Louis, Kansas City and Cleveland, among others). While the crew in D.C. is selected by the president and vetted by Congress, the regional bank presidents are chosen by the financial industry and tend to be either bankers or career Fed employees…

Clinton's proposal would remove bankers from the regional boards of directors. Those boards choose the regional presidents and generate most of the information and perspective that the Federal Reserve governors use to set monetary policy. Clinton clearly understands how the Fed functions…  Most people do not know that they are staffed with chief executives from Morgan Stanley, Comerica, KeyCorp and private-equity firms like Silver Lake, and if they do know it, they do not understand its importance.

The idea that the Fed often acts contrary to the interests of working people is not new, but aside from requiring the Fed to pursue full employment in addition to price stability in 1977, presidents who are unhappy with the Fed have done little more than complain…  Clinton is digging deeper. Changing the roster of the regional boards will hopefully help more accurate economic information trickle up to the chairperson and the federal governors.

In her quiet way, tinkering with the inner workings of a near-century old quasi-government institution that is arcane to most, Clinton has a chance to achieve radical, lasting financial reform.

Last night Hillary Clinton secured enough delegates to become the Democratic nominee for President, but will the Reagan Democrats allow her to become the nominee?  In 2008 Joe Biden, Chuck Schumer and Ted Kennedy colluded to steal the nomination from Clinton, who would have reigned in the Wall Street banks.  The Obama Administration and the Federal Reserve Bank instead bailed out the Wall Street banks to the tune of over $43 trillion dollars.

According to Matt Taibbi at Rolling Stone Magazine, the Obama/Biden Administration is hiding 11,000 documents of information about the financial meltdown of 2008 from the American public.  


Why Is the Obama Administration Trying to Keep 11,000 Documents Sealed?

The "most transparent administration in history" has spent years trying to hide embarrassing financial secrets from the public

For years now, the federal government has been quietly fighting to keep a lid on an 11,000-document cache of government communications relating to financial policy. The sheer breadth of the effort to keep this material secret may not have a precedent in modern presidential times…  The Obama administration invoked executive privilege, attorney-client and deliberative process over these documents and insisted that their release would negatively impact global financial markets…

But in finally unsealing some of these materials last week, a federal judge named Margaret Sweeney said the government's sole motivation was avoiding embarrassment…  So what's so embarrassing? Mainly, it's a sordid history of the government's seizure of mortgage giants Fannie Mae and Freddie Mac, also known as the government-sponsored enterprises, or GSEs…

After 2008, everyone hated Fannie and Freddie, and for good reason. These quasi-private companies are essentially giant piles of money that were intended to advance a simple, utility-like mandate to keep credit flowing in the housing markets…. Contrary to popular belief, the one thing they weren't guilty of was causing the 2008 crash…  As early as March of 2008, then Treasury Secretary Hank Paulson was advocating using Fannie and Freddie to "buy more mortgage-backed securities from overburdened banks."

Even after the state took over the companies in September of 2008, Fannie and Freddie continued to buy as much as $40 billion in bad assets per month from the private sector. Fannie and Freddie weren't just bailed out, they were themselves a bailout, used to sponge up the sins of private firms.  In exchange, the state received an 80 percent stake and the promise of a future dividend. All told, the government ended up pumping about $187 billion into the companies.

But now here's the strange part. Within a few years after the crash, the housing markets improved significantly, to the point where Fannie and Freddie started to make money again. Lots of money. The GSEs became cash cows again, and in 2012 the government unilaterally changed the terms of the bailout…  Now, instead of taking a 10 percent dividend, the government decided that the new number it preferred was 100 percent.

In court filings later on, the government offered a strange excuse for this sudden and dramatic change in the bailout terms. It explained that at the time, the GSEs "faced enormous credit losses" and "found themselves in a death spiral…"  It absolutely denied any foreknowledge that the firms were on the verge of massive profitability.

It got weirder. Despite the fact that the GSEs went on to pay the government $228 billion over the next three years, or $40 billion more than they owed, NONE OF THAT MONEY WENT TO PAYING OFF FANNIE AND FREDDIE'S DEBT…

This was not a debt that could be paid back. Like a restaurant owner who borrows money from a mobster, the GSEs found themselves in an unseverable relationship…  Then and now, government officials lied about what they were doing, and why…  Many of the government officials who were involved in the decisions surrounding the GSE conservatorship are now in the private sector, working on proposals for much-anticipated GSE reform.

Without getting too deeply into the weeds of this even more complicated tale, government officials have been working with Wall Street lobbyists for years on a plan to have a consortium of private banking interests step into the shoes of Fannie and Freddie.

Bingo, Fannie and Freddie are cash cows and the Obama/Biden Administration are colluding with Paul Ryan and the GOP financial terrorists to privatize the profits of Fannie and Freddie.  And there are a whole slew of financially devastating acts against the American people that are planned for after the November election during the lame duck session of congress.

So, stand by and wait and see if the Obama Administration will allow Hillary Clinton to go forward and run for President or if she will be indicted on trumped up charges by Republican FBI Director James Comey.  Comey who served in the George W. Bush Administration was also on the board of directors of the London based HSBC Bank that was fined for laundering money for terrorists.  In the meantime the deadly legacy of Obama, Biden, Paul Ryan and GOP financial terrorists’ of gutting social programs and bankrupting America will continue unabated.

By Patricia Baeten

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