Wednesday, March 25, 2009

A.I.G. Bonuses - The Last Straw By Jerome Grossman, a coup d'état and nothing less, that is a sad fact!

I promised Jerome the relentless Liberal and his son Danny I would spread this around as much as possible as this is of the utmost importance to all of us. Please feel free to spread this to everyone possible! First Coup D'état: stroke of a State, the sudden forcible overthrow of a ruler or Government, sometimes with violence, by a small group of people already having some Political and or military authority!

Now: The national explosion of anger over the bonuses awarded to financial officers at American International Group indicates that the tipping point has been reached in the accumulated resentments on American financial inequality.. For generations, under both Republican and Democratic administrations, the income gap between the 95% of U.S. population lumped together as working class and middle class, and the 5% who earned $250,000 or more per year, has widened significantly. The 5% have more clout. They dominate U.S. politics, education, culture, taxation rules, charitable institutions, media, and business, acting as a kind of American nobility with benefits handed down from generation to generation.

Then comes a time when a relatively insignificant event captures the attention of the masses who begin to connect their anger at the current violation with the other half-remembered abuses. Then comes real change. Sometimes a popular leader emerges to dramatize the exploitation, like William Jennings Bryan, who galvanized the Democratic Party with “You shall not press down upon the brow of labor this crown of thorns. You shall not crucify mankind upon a cross of gold,” dramatizing the economic ills plaguing farmers and industrial workers. He won the Democratic nomination twice although not the presidency. But he won many of his reforms, backed by an aroused citizenry, were adopted, including the income tax, popular election of senators, woman suffrage, popular knowledge of newspaper ownership etc.

Today Americans are worried that the bailout was designed for the benefit of those who created the crisis. They suspect that America has been taken over by a small class of connected insiders who use money to control elections, buy influence, systematically weaken financial regulation and get government money to bail them out when they get into trouble.

The A.I.G. bonuses remind the 95% of:

• The bailouts of the banks and bankers from their own mistakes
• The failure to bail-out the average citizen from unfair mortgages and job layoffs
• The bankers who gambled with depositor money at enormous risk to build bonuses for themselves
• The low tax rate paid by the wealthiest Americans on the top portion of their earnings now at 35%, once 91% under Eisenhower, 70% under Nixon, 50% under Reagan. What happened to the progressive tax based on ability to pay?

• The special tax rate for capital gains of 20% used by the wealthiest Americans

• The special tax breaks given to insiders as earmarks

• Some business executives maintain control by appointing their friends to boards of directors

• Some business executives vote themselves enormous salaries

• Some business executives vote themselves stock options, some of which are back-dated to take advantage of stock price increases

• Some business executives vote themselves enormous retirement packages not based on performance

• Some business executives discharge workers and speed up the rest of the work force to increase short term profits and stock prices

• Some business executives maintain headquarters outside the U.S.A. and shift corporate income from country to country to avoid taxes

Will the anger about A.I.G. bonuses subside? Or will an organization of citizens spring up to fight for their interests? Will another William Jennings Bryan denounce the current abuses and agitate for fairer wages and fairer division of the profits of our technological society? Will the current anger dissipate into the day-to-day problems of an economy in decline? Will the A.I.G. bonuses be the last straw?

People are peeved but as I keep saying, this was done on purpose and is still just beginning regardless of what anyone thinks!

Have you seen this? Liddy made AIG sound like an orphan begging in a soup line, hungry and sick from being left out in someone Else's financial weather. He conveniently forgot to mention that AIG had spent more than a decade systematically scheming to evade U.S. and international regulators, or that one of the causes of its "pneumonia" was making colossal, world-sinking $500 billion bets with money it didn't have, in a toxic and completely unregulated derivatives market.

Nor did anyone mention that when AIG finally got up from its seat at the Wall Street casino, broke and busted in the after dawn light, it owed money all over town — and that a huge chunk of your taxpayer dollars in this particular bailout scam will be going to pay off the other high rollers at its table. Or that this was a casino unique among all casinos, one where middle-class taxpayers cover the bets of billionaires.

People are pissed off about this financial crisis, and about this bailout, but they're not pissed off enough. The reality is that the worldwide economic meltdown and the bailout that followed were together a kind of revolution, a coup d'état. They cemented and formalized a political trend that has been snowballing for decades: the gradual takeover of the government by a small class of connected insiders, who used money to control elections, buy influence and systematically weaken financial regulations.

The crisis was the coup de grâce: Given virtually free rein over the economy, these same insiders first wrecked the financial world, then cunningly granted themselves nearly unlimited emergency powers to clean up their own mess. The Big Takeover


Dave Dubya said...

That Taibbi article is something I have urged my friends to read. He was on Rachel Maddow last night, too. That's a cool thing.

We finally see it now in the open. We've been calling our system a corporatocracy for years now. Maybe this mess will wake up enough people to make a difference. Well, at least wake them up. I don't think a difference can be made without true leadership. Obama MUST do what FDR did and become a "traitor to his class".

Demeur said...

I would agree this was nothing more than the biggest bank robbery in world history. But what would you do? They've conviently made it so that any punitive actions by us would hurt us as well. They're like the extortionist with the bomb vest. Should we try and punch them or shoot them they release the trigger and we all get blown up.
I'm as mad as hell about this just as you are but what are you going to do? As Obama pointed out these guys did what they did legally unlike our last president who thought laws were for sombody else.
The other thing to consider in all of this is that what's to prevent employers from undoing a contract with workers in the future. What's to prevent them from eliminating retirement, healthcare and benefits from a contract with their workers retroactively? Remember any rules we put in place right now to prevent further abuses in the future could bite us in the butt later.

Brother Tim said...

This House of Cards is on the verge of collapse. I say, 'Get it on, and get it over with'. Everyone seems overly concerned with the pain it will cause. Are you willing to suffer with a toothache for years on end, just to avoid the pain of having it pulled? Once the tooth is pulled, the pain stops and the healing of the gums begins. Likewise, so too, the economic crisis.

My post today was in the same vein.

an average patriot said...

That has to get read and heard by our so called leaders and they must act on it or like everything else it is worthless.

an average patriot said...

Oil companies these financial companies, Banks, everyone was allowed to run amok under Bush and his insistence of so what you want with no over sight.

We hear they did this legally but I doubt it. They did do it while Barney frank and everyone else turned a blind eye! To me it would be easy for Congress to pass a law saying whoever takes our money must give up all prior contracts and succumb to adjusted ones.

an average patriot said...

Hey Brother
I will be by of course. I just got back from the VA. It is a 5 hour trip but oh well.
I am just peeved this was all done on purpose for one reason or the other under Bush for selfish gain. Now we have to fix it amongst the underhanded lying game playing. Who knows how this is going to turn out.
Bush's house of cards though did crumble and what a coincidence on someone else s watch. I hate them scum!

Demeur said...

The problem there is that congress can't pass a law retroactively (Expo Facto)it's against the constitution. What they need to do is undo the Grahm Leach Bliley Act. That was the one that created this mess. It in 1999 permitted banks to do investments and vice versa. The laws passed in the 30s were to prevent this current mess and they were eliminated with GLB Act. You'd think we'd learn.

Monique said...

It's just as big a mess as here Jim.

an average patriot said...

It is getting pretty bad! I had a line of thought this morning I wanted to work on but it is getting bad quickly!
NBC in Connecticut has received dozens of death threats to AIG including their kids and shooting them in the head and the Revolution has begun. I have said it for years now but this is just beginning and it will not be good!

an average patriot said...

Hi Monique
For some reason it feels like I have not heard from you in a while. Hope you guys are well!

I am listening to the threats to AIG right now. This is a class war! They threaten to hunt them down and shoot them in the head. The revolution is coming!

I understand Execs in Europe have refused to give the bonuses back calling it extortion. This as I keep saying is just beginning!