Posts Tagged ‘Goldman Sachs’
May 5th, 2010 at 7:43 pm
Freddie Mac Back to Remind You of Its Failures

As Goldman Sachs is reeled into court for potential securities fraud, a bigger fish is still swimming free and wreaking havoc on the public.  Freddie Mac, one half of the not-so-dynamic duo of government-backed mortgage peddlers, took another massive hit during the first quarter of the year.  The company, which is largely owned by the federal government after the 2008 bailouts, is set to ask for an additional $10.6 billion in “federal aid,” aka more bailouts.

With assistance and pressure from Washington to make housing affordable for all, one can see how Freddie Mac thinks that money grows on trees.  Unfortunately, all of us in the real world, from whom the government is funded, should be concerned how “We the Taxpayers” are going to come up with another $10 billion to flush down the toilet.  Not to mention why.

More troubling, while Goldman Sachs is getting grilled at congressional hearings, financial reform legislation, which unleashes a broadside against banks, but not a single provision addressing the troublesome Fannie and Freddie, will soon be ushered to a vote.  The Kansas City Star’s E. Thomas McClanahan stated it well:

“Wall Street’s excesses sent the markets and the economy off a cliff, but the seeds of the debacle were planted by politicians and richly fertilized by their creations: Fannie and Freddie…”

The shenanigans on Wall Street may or may not have brushed up against the law, but the opportunity and incentive would not have existed had the federal government and its lending arms, Fannie and Freddie, not insisted on giving mortgages to folks who could not afford them.  Congress should remember as they point a finger at Wall Street that four fingers are pointing back at them.

April 28th, 2010 at 9:41 am
Ramirez Cartoon: In the Pocket of Big Labor
Posted by Print

Below is one of the latest cartoons from Pulitzer Prize-winner Michael Ramirez.

View more of Michael Ramirez’s cartoons on CFIF’s website here.

April 20th, 2010 at 3:17 pm
About that Revolving Door …
Posted by Print

Remember all the pieties in the early days of the Obama Administration about how there would be a higher wall between special interests and the White House than ever before? Those of us who know the realities of Washington never expected much from those promises. After all, there is a limited pool of talented people in our nation’s capital.  When they’re not working in the public sector, they have to make up for it with the higher pay that comes from private sector jobs. Keeping those folks from jumping back and forth would dramatically reduce the federal government’s talent pool.

But while the potential for this promise to be broken could be seen a mile away, who would’ve guessed that it would have happened in a fashion so embarassing to the White House? Just a few days after the Securities and Exchange Commission announced that it was going after Goldman Sachs for dodgy shorting practices — an event that (coincidentally, we’re told) came in the midst of the Administration’s push for new banking regulations — Politico reports that Obama’s former White House Counsel, Greg Craig, has been retained by Goldman to help them navigate the rocky shoals of the Beltway.

One wishes some enterprising member of the White House Press Corps would put the question to the President: “Is your former White House counsel part of the corrupt Washington infrastructure you deplore or does the private sector have legitimate grievances with how it’s being treated by your administration?” It has to be one or the other.

November 2nd, 2009 at 11:55 am
Obama Unveils Re-Election Strategy

During his closing argument for New Jersey Governor Jon Corzine’s re-election campaign, President Barack Obama moved back the goalposts on when elected leaders should be held accountable for their actions:

Listening to Jon’s opponent, you’d think New Jersey was the only state going through a tough time right now,” Obama told almost 19,000 gathered inside the Prudential Center in Newark. “I have something to report: We have the worst financial crisis since the Great Depression. By the way, that didn’t start under Jon’s watch, that didn’t start under my watch. I wasn’t sworn in yet.”

Obama quipped there was a little revisionist history or selective memory on the part of Republicans and other critics who seek to hold Corzine responsible for New Jersey’s economic woes.

“A little amnesia about how we got into this mess,” Obama explained. “This crisis we are living . . . came about because of the same theories, the same laxed regulation, the same trickle-down economics that the other guy’s party has been peddling for years. And you know, look, we’re not interested in relitigating the past, and I’m more than happy to go and do the work that’s required to get this economy moving again. I think about it every day. Jon Corzine thinks about it every day.”

One problem with Obama’s remarks; Corzine was sworn in before the economic recession hit – by two years. And it’s not like Corzine can say he’s just a community organizer with scant business experience. As head of Goldman Sachs during part of its “master of universe” phase, Corzine – along with former colleague and successor, Hank Paulson – knows how to make money under a lax regulatory system.

In fact, Corzine apparently knows how to “spread the money around” to take care of his former corporation while serving in government.

As for the president, apparently he thinks a re-election campaign is not the right forum to “re-litigate” the past four years of the current administration. Good to know. I guess that means a politician can only be criticized when he’s termed out of office. Thank goodness for Jon Corzine!

October 19th, 2009 at 3:20 pm
Two Policies, One Principle?

Talk about mixed messages. Yesterday, top White House advisor David Axelrod warned Goldman Sachs for having the audacity to link pay for performance during a recession. The end-of-year compensation is apparently “offensive” in a time of recession. Moreover, Wall Street needs to “stand down” its opposition to further regulation of the financial industry because the government needs to “move forward” on “reforms.”

Today, President Barack Obama announces a “shift” in policy towards the government of Sudan. In the past, the President described Omar al-Bashir’s administration as genocidal. Now, in an effort to ransom better treatment for the millions terrorized by al-Bashir’s partisans, Obama offers “incentives” (i.e. money) hoping it will spur a change of behavior.

How curious. On the one hand, the Obama foreign policy team thinks money is a better motivator than economic coercion or military force. On the other hand, the Obama domestic policy team thinks coercive regulatory policies and voluntary denial of bonuses are better ways to incentivize performance than offering big pay-days to top flight financial talent. Hmmm…

One searches for the critical distinction to make sense of these seemingly contradictory approaches. Could the best explanation be that with Sudan the White House determines the who, what, when, where, and why of using money as an incentive, while in the case of Goldman Sachs someone other than the government is making the decisions?  If you could pick only one instance to use money as an enticement, should it be for the people that systematically rape, maim, and murder their neighbors?