Submitted by Elaine Magliaro, Guest Blogger
Fed Lifts Veil of Secrecy (December 1, 2010)
“Almost two years ago I asked Chairman Bernanke to tell the American people which financial institutions and 
corporations received trillions of dollars as part of the Wall Street bailout. He refused. Today, as a result of an audit-the-Fed provision I put into the financial reform bill, we finally learn the truth – and it is astounding.”
— Sen. Bernie Sanders (I-Vt.), author of Fed disclosure provision
Lifting the Veil of Fed Secrecy
Who Got Secret Fed Bailouts?
The Big Winners
• Goldman Sachs received nearly $600 billion
• Morgan Stanley received nearly $2 trillion
• Citigroup received $1.8 trillion
• Bear Stearns received nearly $1 trillion
• Merrill Lynch received some $1.5 trillion
• Deutsche Bank, a German lender, sold the Fed more than $290 billion worth of mortgage securities
• Credit Suisse, a Swiss bank, sold the Fed more than $287 billion in mortgage bonds
Also receiving secret Fed bailouts
• General Electric
• McDonald’s
• Caterpillar
• Harley Davidson
• Toyota
• Verizon
Release: Sanders Statement on New Federal Reserve Lending Disclosures (March 31, 2011)
WASHINGTON, March 31 – Under court order, the Federal Reserve today identified more banks that took loans during the financial crisis using a once-secret system that Sen. Bernie Sanders (I-Vt.) called “welfare for the rich and powerful.”
A Sanders provision in the Wall Street reform law already had forced the Fed last Dec. 1 to name banks that took trillions of dollars in emergency loans during the crisis.
“The Federal Reserve bailout was welfare for the rich and powerful and you-are-on-your-own rugged individualism for everyone else,” Sanders said. “The information released by the Fed today should never have been kept secret. This money does not belong to the Federal Reserve; it belongs to the American people. I applaud Bloomberg News, Fox News and others for their success in lifting another veil of secrecy at the Fed.”
Sanders said the latest disclosure raises questions about conflicts of interest. While Jamie Dimon, the CEO of JPMorgan Chase, served on the board of directors of the New York Fed, in one month alone, April of 2008, JPMorgan Chase received a combined $313 billion in Fed loans directly benefitting JP Morgan Chase and other financial institutions.
“This is an obvious conflict of interest on its face that must be investigated as part of the independent audit that my amendment requires to be completed this summer. When JPMorgan Chase was telling the world about their great financial success, it seems like they were using the Fed’s discount window as a giant piggy bank.”
Sanders’ provision in the Wall Street reform bill required the central bank to disclose which financial institutions, corporations, and foreign central banks took more than $3 trillion in what were secret loans.
His amendment also directed the Government Accountability Office to conduct the first top-to-bottom audit of the Federal Reserve. The findings of that investigation by the non-partisan research arm of Congress are due to be made public this July.
Usage of Federal Reserve Credit and Liquidity Facilities
MSNBC w/ Cenk: Matt Taibbi – Magic Money Printing Machine at The Fed
Need I say more?????
I’ll just add this: Because April is National Poetry Month, I thought I’d write a song parody to go with this post. I dedicate it to Senator Bernie Sanders of Vermont.
Guess Where Our Money Goes?: A Song Parody by Elaine Magliaro
(To be sung to the tune of That’s Where My Money Goes…to Buy My Baby Clothes)
Guess where our money goes? Not where you might suppose!
It goes to millionaires with big yachts and grand chateaux.
They’re worth their weight in gold. The rest of us keep getting rolled.
Hey, hey! That’s where our money goes!
Bernanke is in the tank for Goldman Sachs and Citibank,
GE and Verizon, too. They got bailout funds—it’s true!
The Fed gave them lots of dough—tried to keep it a secret though.
Hey, hey! That’s where our money goes!
The rich keep getting more and more! It’s something that we should deplore.
Citizens should know about the money that Ben’s passing out.
Bernanke, it just ain’t fair. Main Street oughta get a share.
Hey, hey! That’s where our money goes!
SOURCES & FURTHER READING
Sanders Op-Ed: Sunshine Week
Source: The Caledonian-Record (March 16, 2011)
Articles & Blog Posts by Matt Taibbi
The Great American Bubble Machine
From tech stocks to high gas prices, Goldman Sachs has engineered every major market manipulation since the Great Depression — and they’re about to do it again
(This article appeared in the July 9, 2009 issue of Rolling Stone.)
Wall Street’s Big Win
Finance reform won’t stop the high-risk gambling that wrecked the economy — and Republicans aren’t the only ones to blame
(This article appeared in the August 19, 2010 issue of Rolling Stone.)
Why Isn’t Wall Street in Jail?
Financial crooks brought down the world’s economy — but the feds are doing more to protect them than to prosecute them
(This article appeared in the March 3, 2011 issue of Rolling Stone.)
Looting Main Street
How the nation’s biggest banks are ripping off American cities with the same predatory deals that brought down Greece
(This article appeared in the April 15, 2010 issue of Rolling Stone.)
Jefferson County, Alabama: Screwed By Wall Street, Still Paying
(TAIBBLOG—April 7, 2011)
Why is the Fed Bailing Out Qaddafi?
(TAIBBLOG—April 1, 2011)
Edited to add:
The S.E.C.’s Revolving Door: From Wall Street Lawyers to Wall Street Watchdogs (TAIBBLOG—March 30, 2011)
Release: Sanders Calls Budget Deal Robin Hood in Reverse
http://sanders.senate.gov/newsroom/news/?id=3990a1d9-fdd7-4ba5-8c08-53f8368289b7
WASHINGTON, April 12 – Sen. Bernie Sanders (I-Vt.) said today he will vote against a bill that cuts more than $38 billion from programs that help working families without calling for shared sacrifice by the wealthiest Americans.
Bush-era tax breaks for the very rich were extended and expanded last December – driving up the deficit. “Today, in order to reduce deficits that Republicans helped create, they now are slashing programs of enormous importance to working families, the elderly, the sick and children,” Sanders said. “At a time when the gap between the very rich and everybody else is growing wider, this budget is Robin Hood in reverse. It takes from struggling working families and gives to multi-millionaires. This is obscene.”
While it is too soon to determine the exact impact the cuts will have on Vermont, Sanders, a member of the Senate Budget Committee, said “there can be no doubt that these cuts will be devastating to working families in Vermont and throughout the country.”
At a time of soaring fuel prices, the Low-Income Home Energy Assistance Program (LIHEAP) would be cut by $390 million.
At a time when college education has become unaffordable for many, Pell grants would be reduced by an estimated $35 billion over 10 years, including a nearly $500 million cut this year.
At a time when 50 million Americans have no health insurance, community health centers would be cut by $600 million and the Children’s Health Insurance Program would be cut by $3.5 billion.
At a time when poverty is increasing, the Women Infant and Children (WIC) nutrition program for low-income pregnant women would be cut by $504 million.
At a time when we have to put Americans to work rebuilding our crumbling infrastructure, federal funding for high-speed rail would be eliminated, representing a cut of $2.9 billion. Public transportation would be cut by nearly $1 billion, a 20 percent reduction.
At a time when police departments are struggling with inadequate budgets, local law enforcement funding would be cut by $296 million.
At a time when homelessness is increasing, public housing would be cut by $605 million.
“This budget moves America in exactly the wrong direction,” Sanders said. “While there is no question that we must reduce soaring deficits, it must be done in a way that is fair, which protects the most vulnerable people in our country, and which requires shared sacrifice. I will not support a budget that will cut programs for struggling working families, the elderly, children and the poor while expanding tax breaks for billionaires, maintaining corporate tax loopholes and increasing military spending. That is just plain wrong.”
In the coming weeks, Sanders said he will work with colleagues in the Senate and House on a deficit-reduction package that is fair to all, and does not balance the budget only on the backs of working families.
Here’s a link to Matt Taibbi’s most recent Rolling Stone article about the Fed and the bailout:
The Real Housewives of Wall Street
Why is the Federal Reserve forking over $220 million in bailout money to the wives of two Morgan Stanley bigwigs?
http://www.rollingstone.com/politics/news/the-real-housewives-of-wall-street-look-whos-cashing-in-on-the-bailout-20110411?print=true
Excerpt:
America has two national budgets, one official, one unofficial. The official budget is public record and hotly debated: Money comes in as taxes and goes out as jet fighters, DEA agents, wheat subsidies and Medicare, plus pensions and bennies for that great untamed socialist menace called a unionized public-sector workforce that Republicans are always complaining about. According to popular legend, we’re broke and in so much debt that 40 years from now our granddaughters will still be hooking on weekends to pay the medical bills of this year’s retirees from the IRS, the SEC and the Department of Energy.
Most Americans know about that budget. What they don’t know is that there is another budget of roughly equal heft, traditionally maintained in complete secrecy. After the financial crash of 2008, it grew to monstrous dimensions, as the government attempted to unfreeze the credit markets by handing out trillions to banks and hedge funds. And thanks to a whole galaxy of obscure, acronym-laden bailout programs, it eventually rivaled the “official” budget in size — a huge roaring river of cash flowing out of the Federal Reserve to destinations neither chosen by the president nor reviewed by Congress, but instead handed out by fiat by unelected Fed officials using a seemingly nonsensical and apparently unknowable methodology.
Now, following an act of Congress that has forced the Fed to open its books from the bailout era, this unofficial budget is for the first time becoming at least partially a matter of public record. Staffers in the Senate and the House, whose queries about Fed spending have been rebuffed for nearly a century, are now poring over 21,000 transactions and discovering a host of outrages and lunacies in the “other” budget. It is as though someone sat down and made a list of every individual on earth who actually did not need emergency financial assistance from the United States government, and then handed them the keys to the public treasure. The Fed sent billions in bailout aid to banks in places like Mexico, Bahrain and Bavaria, billions more to a spate of Japanese car companies, more than $2 trillion in loans each to Citigroup and Morgan Stanley, and billions more to a string of lesser millionaires and billionaires with Cayman Islands addresses. “Our jaws are literally dropping as we’re reading this,” says Warren Gunnels, an aide to Sen. Bernie Sanders of Vermont. “Every one of these transactions is outrageous.”
Anon nurse,
Great link to Naomi Klein’s announcement.
That was to you, Elaine M., but hopefully others will find it interesting, as well.
Yes, you’re right… Coincidentally, I happened to see the following on her blog yesterday:
Joining 350.Org: The Next Phase
By Naomi Klein – April 7th, 2011
Today I joined the newly formed Board of Directors of 350.org, coinciding with a range of exciting new changes at the organization. I have been a supporter of 350.org since I first heard about the wacky plan to turn a wonky scientific target into a global people’s movement, and I’m thrilled and honored to be officially joining the team.
…and it continues:
As 350.org has known all along, the real task is to build the kind of mass movement that politicians cannot afford to ignore. That means showing how making the deep emission cuts that science demands is not some dour punishment that will destroy our economy (as the Koch-funded right is perpetually claiming) but rather our best chance of fixing an economic system that is failing us on every level. Shifting to renewable energy and re-localizing our economies could create millions of good new jobs, while leaving us with cleaner cities and a healthier food system. And as 350.org’s Global Work Party showed, a big part of averting climate chaos involves rebuilding and strengthening our frayed communities – and that is a joyful process.
end excerpt
anon nurse,
Taking advantage of crises to move an agenda forward. That’s reminiscent of Naomi Klein’s “The Shock Doctrine.”
Elaine M., No, I haven’t heard of ALEC — will take a look at the links you’ve provided. Thanks. Some very good work here, and on the blog, in general…
Swarthmore mom and Elaine M., I’d like to see Hedges in person… Have read his book, “American Fascists, The Christian Right and The War on America”, which I highly recommend.
In the final chapter, he states:
“I do not believe that America will inevitably become a fascist state or that the Christian Right is the Nazi Party. But I do believe that the radical Christian Right is a sworn and potent enemy of the open society. It’s ideology bears within it the tenets of a Christian fascism. In the event of a crisis, in the event of another catastrophic terrorist attack, an economic meltdown or huge environmental disaster, the movement stands poised to manipulate fear and chaos ruthlessly and reshape America in ways that have not been seen since the nation’s founding. All Americans — not only those of faith — who care about our open society must learn to speak about this movement with a new vocabulary, to give up passivity, to challenge aggressively this movement’s deluded appropriation of Christianity and to do everything possible to defend tolerance. The attacks by this movement on the rights and beliefs of Muslims, Jews, immigrants, gays and lesbians, women, scholars, scientists, those they dismiss as “nominal Christians,” and those they brand with the curse of “secular humanism” are an attack on all of us, on our values, our freedoms and ultimately our democracy. Tolerance is a virtue, but tolerance coupled with passivity is a vice.”
Alan Grayson: “Which Foreigners Got the Fed’s $500,000,000,000?” Bernanke: “I Don’t Know.”
Bank Bailouts Explained
Columbia Business School Spring 2006 Follies spoof on The Police’s “Every Breath You Take” featuring imitation Dean Glenn Hubbard and Fed Chairman Ben Bernanke
Every Breath Bernanke Takes
http://www.youtube.com/watch?v=5t3CWk6dSdE&feature=related
[youtube http://www.youtube.com/watch?v=5t3CWk6dSdE&w=640&h=390%5D
almost as good as the original…..;)
anon nurse, Chris hedges spoke at the Unitarian church in Dallas. I thought about going but didn’t.
anon nurse,
Thanks for that link!
Have you heard about ALEC–American Legislative Exchange Council? That organization has been writing legislation for state politicians for years.
Here’s one article on the subject:
7 striking revelations from NPR’s investigation into how companies influence lawmakers
By Liz Goodwin
Yahoo, 10/29/2010
http://news.yahoo.com/s/yblog_upshot/20101029/pl_yblog_upshot/how-corporations-write-laws-behind-closed-doors
The private prison industry helped write Arizona’s anti-illegal-immigration bill in a closed-door session in a hotel conference room, and then donated to 30 of the bill’s co-sponsors after the bill passed, NPR revealed in a blockbuster story yesterday.
Now, NPR has a second story out explaining how the nonprofit American Legislative Exchange Council (ALEC) brings together corporations and legislators who collaborate to design “model bills” out of the sight of taxpayers and voters. These conferences are not considered lobbying (see below), so much of what goes on remains opaque to outsiders.
Legislators pay $50 a year to join ALEC, and are then treated to conferences with the group’s corporate members, who collectively shell out $6 million per year for the privilege. In addition to the private prison company the Corrections Corporation of America, tobacco company Reynolds American Inc., Exxon Mobil Corp. and pharmaceutical company Pfizer Inc. are among the group’s members.
Here’s our round-up of the seven most striking revelations from the story, which you should read in full here:
1. Just over the past year, more than 200 of the organization’s “model” bills — drafted by corporations with the lawmakers — became law around the country.
2. Because member organizations don’t actively advocate for policies, ALEC’s conferences — where these bills are created — are not considered lobbying. That means companies don’t have to disclose which lawmakers they’re talking to or how much they’re spending at these conferences.
3. It also means that ALEC gets to keep its nonprofit status. Corporations can write off the donations they give ALEC as charitable gifts, and ALEC does not have to disclose its membership, donors, or how it spends its money.
4. Lawmakers are told to bring their families and are treated to golf tournaments and parties at these conferences. Corporations sponsor open bars and baseball games, which lawmakers do not have to disclose as gifts.
5. There are an unnamed amount of “scholarships” that ALEC gives out so that politicians do not even have to pay their own travel expenses to get to the conferences. Arizona state Senator Russell Pearce, the sponsor of anti-illegal-immigration law SB1070, traveled to the conference on such a scholarship.
6. Five of the politicians pushing for laws nearly identical to Arizona’s in other states were in the same hotel conference room with the Corrections Corporation of America in which SB1070 was crafted.
7. ALEC’s director of policy, Michael Bowman, says lawmakers come to the conference to learn about legislation, not to be pressured or influenced. “They’re just trying to learn a policy and understand it,” he said. Lobbying is defined in most states as convincing politicians to make or pass laws. Bowman says at ALEC, politicians are just trying to “find” good laws, and thus it is not lobbying.
**********
Here’s the link to the NPR story:
Shaping State Laws With Little Scrutiny
by Laura Sullivan
NPR, 10/29/2010
http://www.npr.org/templates/story/story.php?storyId=130891396
Monday, April 4, 2011 by TruthDig.com
This Is What Resistance Looks Like
by Chris Hedges
http://www.commondreams.org/view/2011/04/04
From the article:
The 10 major banks, which control 60 percent of the economy, determine how our legislative bills are written, how our courts rule, how we frame our public debates on the airwaves, who is elected to office and how we are governed. The phrase consent of the governed has been turned by our two major political parties into a cruel joke. There is no way to vote against the interests of Goldman Sachs. And the faster these banks and huge corporations are broken up and regulated the sooner we will become free. (end excerpt)
frank, Saw Greenspan on CNBC last month, and he was still saying the same thing.
SW – Helicopter Ben just swooped in with buckets of cash to save his little friends from the hard questions.
Mr. Andrea Mitchell was the real mastermind of the catastrophe. Apparently Ayn must have transmitted her mental illness to him when he was slipping his little Taggert into her Gaults Gulch back in the 50’s. The fool actually seems to believe all that bullshit about how ‘producers’ think and act. For 20 years he performed a great social experiment on a once great nation and it will be generations before it recovers, if ever.
Here’s something for neat comparison….
The five largest-cap U.S. companies and their market values as of June 2010
Exxon Mobil: $279 billion
Apple: $228 billion
Microsoft: $221 billion
Procter & Gamble: $175 billion
Johnson & Johnson: $160 billion
Schmuckster Adams,
We welcome posters who are poetically inclined!
*****
Steve,
I remember that “much older” song. Calamity Jane was one of my favorite movies when I was a kid.
Good one, Schmuckster! Thanks! Although, being an old guy, I had a much older song in mind, one popularized by Doris Day.