Tuesday, November 29, 2011

Secret Fed Loans Gave Banks $13 Billion

Secret Fed Loans Gave Banks $13 Billion

Bloomberg Markets Magazine
James "Jamie" Dimon, chairman and chief executive officer of JPMorgan Chase & Co., participates in a session on the second day of the World Economic Forum (WEF) Annual Meeting 2011 in Davos, Switzerland, on Thursday, Jan. 27, 2011. Photographer: Tomohiro Ohsumi/Bloomberg
Nov. 28 (Bloomberg) -- Bloomberg Markets magazine's January issue examines how the Federal Reserve and big banks fought for more than two years to keep details of the largest bailout in U.S. history a secret. And how bankers failed to mention that they took tens of billions of dollars in emergency loans at the same time they were assuring investors their firms were healthy. (Source: Bloomberg)
Nov. 28 (Bloomberg) -- The Federal Reserve and the big banks fought for more than two years to keep details of the largest bailout in U.S. history a secret. No one calculated until now that banks reaped an estimated $13 billion of income by taking advantage of the Fed’s below-market rates, Bloomberg Markets magazine reports in its January issue. Betty Liu reports on Bloomberg Television's "In the Loop." (Source: Bloomberg)
On Nov. 26, 2008, then-Bank of America Corp. Chief Executive Officer Kenneth D. Lewis wrote to shareholders that he headed “one of the strongest and most stable major banks in the world.” He didn’t say that his firm owed the central bank $86 billion that day. Photo: Joshua Roberts/Bloomberg
The Federal Reserve and the big banks fought for more than two years to keep details of the largest bailout in U.S. history a secret. Now, the rest of the world can see what it was missing.
The Fed didn’t tell anyone which banks were in trouble so deep they required a combined $1.2 trillion on Dec. 5, 2008, their single neediest day. Bankers didn’t mention that they took tens of billions of dollars in emergency loans at the same time they were assuring investors their firms were healthy. And no one calculated until now that banks reaped an estimated $13 billion of income by taking advantage of the Fed’s below-market rates, Bloomberg Markets magazine reports in its January issue.
Saved by the bailout, bankers lobbied against government regulations, a job made easier by the Fed, which never disclosed the details of the rescue to lawmakers even as Congress doled out more money and debated new rules aimed at preventing the next collapse.
A fresh narrative of the financial crisis of 2007 to 2009 emerges from 29,000 pages of Fed documents obtained under the Freedom of Information Act and central bank records of more than 21,000 transactions. While Fed officials say that almost all of the loans were repaid and there have been no losses, details suggest taxpayers paid a price beyond dollars as the secret funding helped preserve a broken status quo and enabled the biggest banks to grow even bigger.

‘Change Their Votes’

“When you see the dollars the banks got, it’s hard to make the case these were successful institutions,” says Sherrod Brown, a Democratic Senator from Ohio who in 2010 introduced an unsuccessful bill to limit bank size. “This is an issue that can unite the Tea Party and Occupy Wall Street. There are lawmakers in both parties who would change their votes now.”
The size of the bailout came to light after Bloomberg LP, the parent of Bloomberg News, won a court case against the Fed and a group of the biggest U.S. banks called Clearing House Association LLC to force lending details into the open.
The Fed, headed by Chairman Ben S. Bernanke, argued that revealing borrower details would create a stigma -- investors and counterparties would shun firms that used the central bank as lender of last resort -- and that needy institutions would be reluctant to borrow in the next crisis. Clearing House Association fought Bloomberg’s lawsuit up to the U.S. Supreme Court, which declined to hear the banks’ appeal in March 2011.
$7.77 Trillion
The amount of money the central bank parceled out was surprising even to Gary H. Stern, president of the Federal Reserve Bank of Minneapolis from 1985 to 2009, who says he “wasn’t aware of the magnitude.” It dwarfed the Treasury Department’s better-known $700 billion Troubled Asset Relief Program, or TARP. Add up guarantees and lending limits, and the Fed had committed $7.77 trillion as of March 2009 to rescuing the financial system, more than half the value of everything produced in the U.S. that year.
“TARP at least had some strings attached,” says Brad Miller, a North Carolina Democrat on the House Financial Services Committee, referring to the program’s executive-pay ceiling. “With the Fed programs, there was nothing.”
Bankers didn’t disclose the extent of their borrowing. On Nov. 26, 2008, then-Bank of America (BAC) Corp. Chief Executive Officer Kenneth D. Lewis wrote to shareholders that he headed “one of the strongest and most stable major banks in the world.” He didn’t say that his Charlotte, North Carolina-based firm owed the central bank $86 billion that day.

‘Motivate Others’

JPMorgan Chase & Co. CEO Jamie Dimon told shareholders in a March 26, 2010, letter that his bank used the Fed’s Term Auction Facility “at the request of the Federal Reserve to help motivate others to use the system.” He didn’t say that the New York-based bank’s total TAF borrowings were almost twice its cash holdings or that its peak borrowing of $48 billion on Feb. 26, 2009, came more than a year after the program’s creation.
Howard Opinsky, a spokesman for JPMorgan (JPM), declined to comment about Dimon’s statement or the company’s Fed borrowings. Jerry Dubrowski, a spokesman for Bank of America, also declined to comment.
The Fed has been lending money to banks through its so- called discount window since just after its founding in 1913. Starting in August 2007, when confidence in banks began to wane, it created a variety of ways to bolster the financial system with cash or easily traded securities. By the end of 2008, the central bank had established or expanded 11 lending facilities catering to banks, securities firms and corporations that couldn’t get short-term loans from their usual sources.

‘Core Function’

“Supporting financial-market stability in times of extreme market stress is a core function of central banks,” says William B. English, director of the Fed’s Division of Monetary Affairs. “Our lending programs served to prevent a collapse of the financial system and to keep credit flowing to American families and businesses.”
The Fed has said that all loans were backed by appropriate collateral. That the central bank didn’t lose money should “lead to praise of the Fed, that they took this extraordinary step and they got it right,” says Phillip Swagel, a former assistant Treasury secretary under Henry M. Paulson and now a professor of international economic policy at the University of Maryland.
The Fed initially released lending data in aggregate form only. Information on which banks borrowed, when, how much and at what interest rate was kept from public view.
The secrecy extended even to members of President George W. Bush’s administration who managed TARP. Top aides to Paulson weren’t privy to Fed lending details during the creation of the program that provided crisis funding to more than 700 banks, say two former senior Treasury officials who requested anonymity because they weren’t authorized to speak.

Big Six

The Treasury Department relied on the recommendations of the Fed to decide which banks were healthy enough to get TARP money and how much, the former officials say. The six biggest U.S. banks, which received $160 billion of TARP funds, borrowed as much as $460 billion from the Fed, measured by peak daily debt calculated by Bloomberg using data obtained from the central bank. Paulson didn’t respond to a request for comment.
The six -- JPMorgan, Bank of America, Citigroup Inc. (C), Wells Fargo & Co. (WFC), Goldman Sachs Group Inc. (GS) and Morgan Stanley -- accounted for 63 percent of the average daily debt to the Fed by all publicly traded U.S. banks, money managers and investment- services firms, the data show. By comparison, they had about half of the industry’s assets before the bailout, which lasted from August 2007 through April 2010. The daily debt figure excludes cash that banks passed along to money-market funds.

Bank Supervision

While the emergency response prevented financial collapse, the Fed shouldn’t have allowed conditions to get to that point, says Joshua Rosner, a banking analyst with Graham Fisher & Co. in New York who predicted problems from lax mortgage underwriting as far back as 2001. The Fed, the primary supervisor for large financial companies, should have been more vigilant as the housing bubble formed, and the scale of its lending shows the “supervision of the banks prior to the crisis was far worse than we had imagined,” Rosner says.
Bernanke in an April 2009 speech said that the Fed provided emergency loans only to “sound institutions,” even though its internal assessments described at least one of the biggest borrowers, Citigroup, as “marginal.”
On Jan. 14, 2009, six days before the company’s central bank loans peaked, the New York Fed gave CEO Vikram Pandit a report declaring Citigroup’s financial strength to be “superficial,” bolstered largely by its $45 billion of Treasury funds. The document was released in early 2011 by the Financial Crisis Inquiry Commission, a panel empowered by Congress to probe the causes of the crisis.

‘Need Transparency’

Andrea Priest, a spokeswoman for the New York Fed, declined to comment, as did Jon Diat, a spokesman for Citigroup.
“I believe that the Fed should have independence in conducting highly technical monetary policy, but when they are putting taxpayer resources at risk, we need transparency and accountability,” says Alabama Senator Richard Shelby, the top Republican on the Senate Banking Committee.
Judd Gregg, a former New Hampshire senator who was a lead Republican negotiator on TARP, and Barney Frank, a Massachusetts Democrat who chaired the House Financial Services Committee, both say they were kept in the dark.
“We didn’t know the specifics,” says Gregg, who’s now an adviser to Goldman Sachs.
“We were aware emergency efforts were going on,” Frank says. “We didn’t know the specifics.”

Disclose Lending

Frank co-sponsored the Dodd-Frank Wall Street Reform and Consumer Protection Act, billed as a fix for financial-industry excesses. Congress debated that legislation in 2010 without a full understanding of how deeply the banks had depended on the Fed for survival.
It would have been “totally appropriate” to disclose the lending data by mid-2009, says David Jones, a former economist at the Federal Reserve Bank of New York who has written four books about the central bank.
“The Fed is the second-most-important appointed body in the U.S., next to the Supreme Court, and we’re dealing with a democracy,” Jones says. “Our representatives in Congress deserve to have this kind of information so they can oversee the Fed.”
The Dodd-Frank law required the Fed to release details of some emergency-lending programs in December 2010. It also mandated disclosure of discount-window borrowers after a two- year lag.

Protecting TARP

TARP and the Fed lending programs went “hand in hand,” says Sherrill Shaffer, a banking professor at the University of Wyoming in Laramie and a former chief economist at the New York Fed. While the TARP money helped insulate the central bank from losses, the Fed’s willingness to supply seemingly unlimited financing to the banks assured they wouldn’t collapse, protecting the Treasury’s TARP investments, he says.
“Even though the Treasury was in the headlines, the Fed was really behind the scenes engineering it,” Shaffer says.
Congress, at the urging of Bernanke and Paulson, created TARP in October 2008 after the bankruptcy of Lehman Brothers Holdings Inc. made it difficult for financial institutions to get loans. Bank of America and New York-based Citigroup each received $45 billion from TARP. At the time, both were tapping the Fed. Citigroup hit its peak borrowing of $99.5 billion in January 2009, while Bank of America topped out in February 2009 at $91.4 billion.

No Clue

Lawmakers knew none of this.
They had no clue that one bank, New York-based Morgan Stanley (MS), took $107 billion in Fed loans in September 2008, enough to pay off one-tenth of the country’s delinquent mortgages. The firm’s peak borrowing occurred the same day Congress rejected the proposed TARP bill, triggering the biggest point drop ever in the Dow Jones Industrial Average. (INDU) The bill later passed, and Morgan Stanley got $10 billion of TARP funds, though Paulson said only “healthy institutions” were eligible.
Mark Lake, a spokesman for Morgan Stanley, declined to comment, as did spokesmen for Citigroup and Goldman Sachs.
Had lawmakers known, it “could have changed the whole approach to reform legislation,” says Ted Kaufman, a former Democratic Senator from Delaware who, with Brown, introduced the bill to limit bank size.

Moral Hazard

Kaufman says some banks are so big that their failure could trigger a chain reaction in the financial system. The cost of borrowing for so-called too-big-to-fail banks is lower than that of smaller firms because lenders believe the government won’t let them go under. The perceived safety net creates what economists call moral hazard -- the belief that bankers will take greater risks because they’ll enjoy any profits while shifting losses to taxpayers.
If Congress had been aware of the extent of the Fed rescue, Kaufman says, he would have been able to line up more support for breaking up the biggest banks.
Byron L. Dorgan, a former Democratic senator from North Dakota, says the knowledge might have helped pass legislation to reinstate the Glass-Steagall Act, which for most of the last century separated customer deposits from the riskier practices of investment banking.
“Had people known about the hundreds of billions in loans to the biggest financial institutions, they would have demanded Congress take much more courageous actions to stop the practices that caused this near financial collapse,” says Dorgan, who retired in January.

Getting Bigger

Instead, the Fed and its secret financing helped America’s biggest financial firms get bigger and go on to pay employees as much as they did at the height of the housing bubble.
Total assets held by the six biggest U.S. banks increased 39 percent to $9.5 trillion on Sept. 30, 2011, from $6.8 trillion on the same day in 2006, according to Fed data.
For so few banks to hold so many assets is “un-American,” says Richard W. Fisher, president of the Federal Reserve Bank of Dallas. “All of these gargantuan institutions are too big to regulate. I’m in favor of breaking them up and slimming them down.”
Employees at the six biggest banks made twice the average for all U.S. workers in 2010, based on Bureau of Labor Statistics hourly compensation cost data. The banks spent $146.3 billion on compensation in 2010, or an average of $126,342 per worker, according to data compiled by Bloomberg. That’s up almost 20 percent from five years earlier compared with less than 15 percent for the average worker. Average pay at the banks in 2010 was about the same as in 2007, before the bailouts.

‘Wanted to Pretend’

“The pay levels came back so fast at some of these firms that it appeared they really wanted to pretend they hadn’t been bailed out,” says Anil Kashyap, a former Fed economist who’s now a professor of economics at the University of Chicago Booth School of Business. “They shouldn’t be surprised that a lot of people find some of the stuff that happened totally outrageous.”
Bank of America took over Merrill Lynch & Co. at the urging of then-Treasury Secretary Paulson after buying the biggest U.S. home lender, Countrywide Financial Corp. When the Merrill Lynch purchase was announced on Sept. 15, 2008, Bank of America had $14.4 billion in emergency Fed loans and Merrill Lynch had $8.1 billion. By the end of the month, Bank of America’s loans had reached $25 billion and Merrill Lynch’s had exceeded $60 billion, helping both firms keep the deal on track.

Prevent Collapse

Wells Fargo bought Wachovia Corp., the fourth-largest U.S. bank by deposits before the 2008 acquisition. Because depositors were pulling their money from Wachovia, the Fed channeled $50 billion in secret loans to the Charlotte, North Carolina-based bank through two emergency-financing programs to prevent collapse before Wells Fargo could complete the purchase.
“These programs proved to be very successful at providing financial markets the additional liquidity and confidence they needed at a time of unprecedented uncertainty,” says Ancel Martinez, a spokesman for Wells Fargo.
JPMorgan absorbed the country’s largest savings and loan, Seattle-based Washington Mutual Inc., and investment bank Bear Stearns Cos. The New York Fed, then headed by Timothy F. Geithner, who’s now Treasury secretary, helped JPMorgan complete the Bear Stearns deal by providing $29 billion of financing, which was disclosed at the time. The Fed also supplied Bear Stearns with $30 billion of secret loans to keep the company from failing before the acquisition closed, central bank data show. The loans were made through a program set up to provide emergency funding to brokerage firms.

‘Regulatory Discretion’

“Some might claim that the Fed was picking winners and losers, but what the Fed was doing was exercising its professional regulatory discretion,” says John Dearie, a former speechwriter at the New York Fed who’s now executive vice president for policy at the Financial Services Forum, a Washington-based group consisting of the CEOs of 20 of the world’s biggest financial firms. “The Fed clearly felt it had what it needed within the requirements of the law to continue to lend to Bear and Wachovia.”
The bill introduced by Brown and Kaufman in April 2010 would have mandated shrinking the six largest firms.
“When a few banks have advantages, the little guys get squeezed,” Brown says. “That, to me, is not what capitalism should be.”
Kaufman says he’s passionate about curbing too-big-to-fail banks because he fears another crisis.
‘Can We Survive?’
“The amount of pain that people, through no fault of their own, had to endure -- and the prospect of putting them through it again -- is appalling,” Kaufman says. “The public has no more appetite for bailouts. What would happen tomorrow if one of these big banks got in trouble? Can we survive that?”
Lobbying expenditures by the six banks that would have been affected by the legislation rose to $29.4 million in 2010 compared with $22.1 million in 2006, the last full year before credit markets seized up -- a gain of 33 percent, according to, a research group that tracks money in U.S. politics. Lobbying by the American Bankers Association, a trade organization, increased at about the same rate, reported.
Lobbyists argued the virtues of bigger banks. They’re more stable, better able to serve large companies and more competitive internationally, and breaking them up would cost jobs and cause “long-term damage to the U.S. economy,” according to a Nov. 13, 2009, letter to members of Congress from the FSF.
The group’s website cites Nobel Prize-winning economist Oliver E. Williamson, a professor emeritus at the University of California, Berkeley, for demonstrating the greater efficiency of large companies.

‘Serious Burden’

In an interview, Williamson says that the organization took his research out of context and that efficiency is only one factor in deciding whether to preserve too-big-to-fail banks.
“The banks that were too big got even bigger, and the problems that we had to begin with are magnified in the process,” Williamson says. “The big banks have incentives to take risks they wouldn’t take if they didn’t have government support. It’s a serious burden on the rest of the economy.”
Dearie says his group didn’t mean to imply that Williamson endorsed big banks.
Top officials in President Barack Obama’s administration sided with the FSF in arguing against legislative curbs on the size of banks.

Geithner, Kaufman

On May 4, 2010, Geithner visited Kaufman in his Capitol Hill office. As president of the New York Fed in 2007 and 2008, Geithner helped design and run the central bank’s lending programs. The New York Fed supervised four of the six biggest U.S. banks and, during the credit crunch, put together a daily confidential report on Wall Street’s financial condition. Geithner was copied on these reports, based on a sampling of e- mails released by the Financial Crisis Inquiry Commission.
At the meeting with Kaufman, Geithner argued that the issue of limiting bank size was too complex for Congress and that people who know the markets should handle these decisions, Kaufman says. According to Kaufman, Geithner said he preferred that bank supervisors from around the world, meeting in Basel, Switzerland, make rules increasing the amount of money banks need to hold in reserve. Passing laws in the U.S. would undercut his efforts in Basel, Geithner said, according to Kaufman.
Anthony Coley, a spokesman for Geithner, declined to comment.

‘Punishing Success’

Lobbyists for the big banks made the winning case that forcing them to break up was “punishing success,” Brown says. Now that they can see how much the banks were borrowing from the Fed, senators might think differently, he says.
The Fed supported curbing too-big-to-fail banks, including giving regulators the power to close large financial firms and implementing tougher supervision for big banks, says Fed General Counsel Scott G. Alvarez. The Fed didn’t take a position on whether large banks should be dismantled before they get into trouble.
Dodd-Frank does provide a mechanism for regulators to break up the biggest banks. It established the Financial Stability Oversight Council that could order teetering banks to shut down in an orderly way. The council is headed by Geithner.
“Dodd-Frank does not solve the problem of too big to fail,” says Shelby, the Alabama Republican. “Moral hazard and taxpayer exposure still very much exist.”

Below Market

Dean Baker, co-director of the Center for Economic and Policy Research in Washington, says banks “were either in bad shape or taking advantage of the Fed giving them a good deal. The former contradicts their public statements. The latter -- getting loans at below-market rates during a financial crisis -- is quite a gift.”
The Fed says it typically makes emergency loans more expensive than those available in the marketplace to discourage banks from abusing the privilege. During the crisis, Fed loans were among the cheapest around, with funding available for as low as 0.01 percent in December 2008, according to data from the central bank and money-market rates tracked by Bloomberg.
The Fed funds also benefited firms by allowing them to avoid selling assets to pay investors and depositors who pulled their money. So the assets stayed on the banks’ books, earning interest.
Banks report the difference between what they earn on loans and investments and their borrowing expenses. The figure, known as net interest margin, provides a clue to how much profit the firms turned on their Fed loans, the costs of which were included in those expenses. To calculate how much banks stood to make, Bloomberg multiplied their tax-adjusted net interest margins by their average Fed debt during reporting periods in which they took emergency loans.

Added Income

The 190 firms for which data were available would have produced income of $13 billion, assuming all of the bailout funds were invested at the margins reported, the data show.
The six biggest U.S. banks’ share of the estimated subsidy was $4.8 billion, or 23 percent of their combined net income during the time they were borrowing from the Fed. Citigroup would have taken in the most, with $1.8 billion.
“The net interest margin is an effective way of getting at the benefits that these large banks received from the Fed,” says Gerald A. Hanweck, a former Fed economist who’s now a finance professor at George Mason University in Fairfax, Virginia.
While the method isn’t perfect, it’s impossible to state the banks’ exact profits or savings from their Fed loans because the numbers aren’t disclosed and there isn’t enough publicly available data to figure it out.
Opinsky, the JPMorgan spokesman, says he doesn’t think the calculation is fair because “in all likelihood, such funds were likely invested in very short-term investments,” which typically bring lower returns.

Standing Access

Even without tapping the Fed, the banks get a subsidy by having standing access to the central bank’s money, says Viral Acharya, a New York University economics professor who has worked as an academic adviser to the New York Fed.
“Banks don’t give lines of credit to corporations for free,” he says. “Why should all these government guarantees and liquidity facilities be for free?”
In the September 2008 meeting at which Paulson and Bernanke briefed lawmakers on the need for TARP, Bernanke said that if nothing was done, “unemployment would rise -- to 8 or 9 percent from the prevailing 6.1 percent,” Paulson wrote in “On the Brink” (Business Plus, 2010).

Occupy Wall Street

The U.S. jobless rate hasn’t dipped below 8.8 percent since March 2009, 3.6 million homes have been foreclosed since August 2007, according to data provider RealtyTrac Inc., and police have clashed with Occupy Wall Street protesters, who say government policies favor the wealthiest citizens, in New York, Boston, Seattle and Oakland, California.
The Tea Party, which supports a more limited role for government, has its roots in anger over the Wall Street bailouts, says Neil M. Barofsky, former TARP special inspector general and a Bloomberg Television contributing editor.
“The lack of transparency is not just frustrating; it really blocked accountability,” Barofsky says. “When people don’t know the details, they fill in the blanks. They believe in conspiracies.”
In the end, Geithner had his way. The Brown-Kaufman proposal to limit the size of banks was defeated, 60 to 31. Bank supervisors meeting in Switzerland did mandate minimum reserves that institutions will have to hold, with higher levels for the world’s largest banks, including the six biggest in the U.S. Those rules can be changed by individual countries.
They take full effect in 2019.
Meanwhile, Kaufman says, “we’re absolutely, totally, 100 percent not prepared for another financial crisis.”
To contact the reporters on this story: Bob Ivry in New York at; Bradley Keoun in New York at; Phil Kuntz in New York at
To contact the editors responsible for this story: Gary Putka at; David Scheer at

Friday, November 25, 2011

Educate Yourself About OWS

OWS Info Links is the unofficial de facto online resource for the growing occupation movement happening on Wall Street and around the world. definition of OWS:
Learning About OWS:  The New York Times:
Charlie Rose “A Discussion About Occupy Wall Street”
Michael Moore Writes OWS
Ralph Nader talks OWS:
Bill Moyers Writes and Talks:  Corrupt Politicians and Money
Bernie Sanders -The First US Senator to Support Occupy Wall Street
Robert Scheer:  Thirty Years of Unleashed Greed

Sarah van Gelder
Senator Dennis Kucinich
Michael Kieschnick – 10 Ways to Support OWS
Chris Hedges:  This One Could Take Them All Down
Chris Hedges:  Why The Elites Are in Trouble
Washington Post:  Why the Occupy Wall Street protests tell us about the limits of democracy.
The truth of the 2008 Financial Meltdown PBS “The Warning”
Three recent stories from 60 Minutes revealing Government Corruption and Influence
60 Minutes “The Pledge”  Grover Norquist’s Hold on the GOP
60 Minutes:  Jack Abramoff, The Lobbyist’s Playbook
60 Minutes:  Steve Kroft questions Nancy Pelosi and Congressional Insider Trading

60 Minutes:  Steve Kroft:  Prosecuting Wall Street
Banking and Corruption 
Bloomberg News - Secret Fed Loans Gave Banks 13 Billion

Professor James Petras:  Latin America: Growth, Stability and Inequalities: Lessons for the US and EU

Richard (RJ) Eskow “The New War of Independence:  Against Corporate Politics”
And, for a little humor on the f#&^%! mess:  Jon Stuart
Contact John Randolph: 626-3105

Wednesday, November 23, 2011

Newt Baby Shows Some Humanness About Immigration?

Newt baby is simply dangling the immigration carrot in front of Latino voters. He made no promises (as Obama did) about becoming president and reforming immigration for those who he showed some humanness for.

This is the same baloney from the opposite side of the isle.

The only way the undocumented in the U.S. are going to gain legal status is for them to come out to the streets and occupy too. They have been exploited by the same slimy 1% greed that exploits the other 99%.

Why does not one of these blow-heart politicians ever criticize the corrupt, murderous Mexican government for anything? More than 40 thousand people have been killed in the U.S. backed drug war in Mexico, and not one word of that is mentioned in their “Foreign policy/security" ranting and raving?

Do you actually believe that the Mexican undocumented (who make up about 50% of the undocumented in the U.S.) would come or stay here if they could make a decent living wage working at home with their families?

Drug profits, trade, NAFTA, Mexican Oil, and cheap human labor are more important than the lives of US citizens or Mexican nationals.

Sunday, November 20, 2011

American Voters on Immigration: The Most Ignorant Voters in the World?

American voters must be among the most ignorant voters in the world. They keep voting in Republicans or Democrats who are bank rolled by the same elite who have been tag-team raping them for years.

They can't see that the same 1% who rape them are the same 1% who rape the undocument­ed.

Failed immigratio­n is created and designed by the elite who run both government­s. This is no different than failed mortgages, failed health care, loss of jobs, and our failing economy. This insidious 1% causes these failures because they profit at the expense of both the US taxpayers and the Mexican undocument­ed.

Are American voters really so propagandi­zed that they can't figure out why not one single U.S. politician criticizes the Mexican government for anything? The undocument­ed would not come or stay here if that filthy, corrupt co-trading partner of the American elite would take care of its own citizens. The majority of undocument­ed care deeply about their families and would stay at home if they could make a decent living wage working with their families.

Its about bi-nationa­l drug profits, trade, oil, remittance­s, the privatizat­ion of prisons, cheap labor, weapons profit, NAFTA, and a 40 year long political platform that only sways back and forth, and never forward.

I invite OWS to embrace the undocument­ed who are protesting­. Shame on both these pitiful government­s who fail to address the immigratio­n nightmare that they profit from.

Monday, November 14, 2011

The Combined Bi-National Elite’s Exploitation of American Taxpayers and the Mexican Undocumented

In all my twenty-six years serving as a US Border Patrol Agent, INS (Immigration and Naturalization Service) Criminal Investigator and ICE (Immigration and Customs Enforcement) Special Agent, I struggled to understand why our failed immigration and drug enforcement systems operated as they did and do now.  

Why couldn’t Mexican citizens earn a decent living wage at home?  Why were we paid to chase people in the night like animals when many of those same people were coming to the U.S. to pick our fruits and vegetables?  Why did their own Mexican government fail to provide them the same opportunities that they found here on the US side of the border?  Why did our own U.S. government fail to provide the U.S. Border Patrol the resources required to do their enforcement work efficiently and effectively?   And most important of all, why did people from both sides of the border have to get hurt and die because of these two governments’ failed immigration and drug enforcement systems? 

 It has taken me additional years in retirement to educate myself as to insidious reality that underlies these questions that have plagued me for some thirty-two years.

I believe that our immigration and drug enforcement systems are designed to operate in the exact insane manner that they have always operated in.  I believe that the U.S. and Mexican Elite use and maintain these failed systems in order to exploit not only good American taxpayers, but to exploit the good Mexican undocumented people too.  Today the bi-national elite not only profit from this failed immigration system, but they profit from the failed U.S./Mexican drug war too.

Let me further explain this by making a common sense statement.  Mexican cartels influence the Mexican government and its elections in the same way that U.S. corporations influence the American government and its elections too.   Both use pay- offs and bribery to get their immoral ways.  Of course it is not uncommon in Mexico for the cartels to assassinate their way to victory or power too.   

With that said, here is how the Mexican elite profits from our failed immigration and drug policies.  It is estimated that the Mexican undocumented send some 25 billion home in remittances each year in order to help support their own families.  Although the link below shows a recent decline in remittances during these economically troubled years, it still reports 21.9 billion dollars were send back to Mexico from the U.S. in 2009.

What a sweet deal for the Mexican elite!  They profit by not taking responsibility for their own citizens.  They coerce many workers to go north and have those same workers send American made dollars back south into Mexico!   You don’t have to guess who foots the bills for many of those undocumented Mexican’s medical and educational expenses.  Rest assured that the elite do not worry about their taxes being parlayed in this manner.  Finally, do the Mexican elite really have or need any incentives to cut into their own profit margins in order to provide jobs, education, hospitals, roads and clean water for its own poor?  I think not.
Despite all of the drug war propaganda, it is estimated that the Mexican cartels make between 19 and 29 billion dollars a year from illicit drug sales.

“The United States is Mexico’s largest trading partner and largest foreign investor. Mexico is the third largest U.S. trading partner after Canada and China, and is the U.S. second largest foreign supplier of petroleum. The U.S.-Mexico border is one of the busiest, most economically important borders in the world, with nearly one million legitimate travelers and nearly a billion dollars worth of goods legally crossing the border each day.”

The U.S. is and always has been dependent upon undocumented Mexican labor for the harvesting of our fruits and vegetables.    The American owned maquiladoras in Mexico provide inexpensive Mexican labor for many American electronics and clothing conglomerates.

Here is a question for you.  Why do we seldom if ever hear any U.S. politicians criticize the corrupt Mexican government for anything?  Please refer to John Ackerman’s article for insights into Mexico’s corrupt/civil rights abusing government:

With that said, how does the American elite profit from failed immigration and drug policies?  Despite all of the hard line pro-immigration enforcement propaganda, millions of the Mexican undocumented are used and abused for their labor in the American agricultural, farming, restaurant, hotel/motel, service, meat packing, landscaping, and construction industries.   How about the tens of thousands of Mexican undocumented hired under the table or picked up on street corners across America on a daily basis?
Take a peek at how NAFTA has increased American Corn Farmer’s profits at the expense of Mexico’s small corn farmers’ livelihoods.

The privatization of immigration prisons across America rake in $125 to $200 per person per day off of tax payer’s dollars in order to keep the undocumented in jail.   Check out this scam that Arizona’s John McCain backed titled “Operation Streamline”.

How does the American elite profit from the Mexican/US failed war on drugs?  Is it possible that American banks profit by laundering Mexican cartel drug profits?  One bank was actually fined for doing so.  Please refer to Professor James Petras’ article:  Imperialism: Bankers, Drug Wars and Genocide

Are you familiar with the Merida Initiative?  This is how our tax dollars go to support the failed war on drugs.   Can anyone prove that these funds do not end up in the hands of corrupt Mexican military or government officials who work for the cartels?

Who in America makes a living off of our citizen’s addictions to drugs?  For over forty years U.S. taxpayers have poured billions into funding local, state, and federal drug enforcement efforts.

 The U.S. prison industry thrives upon drug enforcement convictions to fill our jails.  In the twenty-five years since the passage of the Anti-Drug Abuse Act, the United States penal population rose from around 300,000 to more than two million. 

Don’t forget all of the people who are employed in the local, state, federal, judicial systems too.  That group includes attorneys, judges, parole/probation officers and clerks of all types for all departments.  How many psychiatrists and psychologists work because of drug abuse?  How many hospitals and clinics operate because of the addicted?  How does “big pharma” profit from people’s addictions to legal and illegal drugs? 

What would cause the bi-national elite and their hired government guns to change the way they do failed immigration and drug “business”?

After watching and working with failed U.S. immigration/drug enforcement programs since 1979, I am convicted that nothing short of civil disobedience will bring these two “governments” to their senses.   There is simply too much money and political capital to be made by having these systems work to the best interests of all involved (especially those of the U.S. taxpayers and the Mexican undocumented).

The failed U.S. and Mexican drug war has created the conditions for a drug war asylum exodus from Mexico.  I support all Mexican citizens who have been persecuted by this failed war to apply en masse for U.S. asylum at all ports of entry across the U.S. Mexican border. Forty thousand people have been killed to date.

Let’s end this madness.

 Secondly, I support all of the Mexican undocumented within the U.S. (five to ten million?) in organizing and forcing the Obama administration to keep its word concerning the change in the Department of Homeland Security (DHS) deportation polices announced August 18, 2011.

These guidelines state that “low priority” immigration cases should be considered for prosecutorial discretion by immigration courts and immigration and customs enforcement officials (ICE).   In my mind that means all Mexican undocumented who have clean criminal records should qualify for discretion.

Thursday, November 10, 2011

The Bi-National Greed of the Mexican and American 1%

Why do we seldom if ever hear any US politicians blame the corrupt, cartel-run Mexican government for its contribution to US problems with the undocumented? Common sense tells me that the Mexican undocumented would not come here or stay here if they could make a living wage working safely at home with their families.

The good people of Mexico have always been beleaguered by the Mexican caste system, or the inequality of the "haves verses the have nots".

American voters do not see how the greed of both the Mexican and American 1% contributes to this crisis which rapes not only good American taxpayers but the Mexican poor too.

The big picture includes the bi-national 1%'s profits from Mexican oil, trade, NAFTA, drugs and labor. By the way, don't forget the US backed Mexican drug war that has left over 40,000 people dead since 2006. The US military industrial complex and US arms manufacturers continue to profit from that failed nightmare.

Elite US profiteers use political propaganda to blame the undocumented for "invading" the US. Yet the Occupy Wall Street movement is revealing who the real invaders of the US are.

I invite all of the Mexican undocumented within the US to join OWS. google two pesos blog
Thursday, November 10, 2011 8:54:44 AM

Wednesday, November 9, 2011

De-ny nein nein plan! Auf Wiedershen Herr man Cain!

Republican presidential candidate Herman Cain speaks at a press conference in Arizona.
Enlarge Eric Thayer/Getty Images Republican presidential candidate Herman Cain speaks at a press conference in Arizona.
Republican presidential candidate Herman Cain stood his ground, repeating that the accusations of sexual harassment made against him while he was the head of the National Restaurant Association are "false, anonymous, incorrect accusations."
In a press conference in Arizona, Cain repeated twice, "I have never acted inappropriately with anyone. Period." The former Godfather's Pizza CEO added that the scandal and the media feeding frenzy were not going to push him to quit the GOP presidential race.
"Ain't gonna happen," he said.
Cain did address allegations made by Karen Kraushaar, the 55-year-old woman identified today as one of the two women who in the late 1990s settled claims of sexual harassment against him.
"When she made her accusations they were found to be baseless," he said. She could not find anyone, he added, to corroborate her story.
Cain said he'd be willing to take a lie detector test and said the allegations made yesterday by a woman — Sharon Bialek of Chicago — who says he sexually harassed her in the late 1990s "simply did not happen."
He repeated what he said in an earlier interview, that he did not recognize her "face, name or voice."
Our friends at It's All Politics are the lead on this story, so they'll have much more.
Update at 6:15 p.m. ET. A Little More Detail:
We wanted to add a few more highlights from the press conference:
— Cain suggested that other accusers might "come out of the woodwork." Not, because he's aware of any others, but because of the zeal to keep him out of the White House.
"The machine to keep a business man out of the White House is going to be relentless," he said.
— The press conference started with an appearance from noted attorney Lin Wood, who represented Richard Jewell, the security guard falsely accused in the Atlanta Olympic bombing.
Wood said that Cain was on trial in the "court of public opinion," and now "Herman Cain has to respond to hearsay," without the benefit of the justice system.
— Cain said that throughout his professional career, "respect for women [has been] a priority."