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Hillary Remains Clueless About Regulation on the 28th Anniversary of the Keating Five Meeting

By William K. Black | New Economic Perspectives | April 9, 2015

The Clintons’ Unlearned Lessons of the Keating Five Meeting

On April 9, 1987, twenty-eight years ago today, my colleagues and I from the Federal Home Loan Bank of San Francisco (FHLBSF) met with five senators at the behest of the most notorious savings and loan (S&L) fraud – Charles Keating. Keating was looting Lincoln Savings through classic “accounting control fraud” techniques. Our examiners and enforcement investigation led by Anne Sobol (detailed from Litigation Division) had discovered and documented some of Keating’s worst frauds. Keating, desperate to prevent our recommendation that the federal agency place Lincoln Saving into conservators (removing Keating from power), used the five senators to try to pressure us into taking no enforcement action against Lincoln Savings and its officers for the largest violation of rules in the history of our agency.

The agency’s statutory authority to place a state-chartered S&L like Lincoln Savings into conservatorship had lapsed so Bank Board Chairman Edwin Gray could not act on our recommendation until Congress passed legislation restoring our power. The five Senators, of course, would have a great deal to say about whether and when that legislation was passed. Because we refused to give in to their intimidation, the Keating Five helped ensure that the power to remove Keating from power was not passed until after Gray’s term ended – and President Reagan’s cynical secret deal with Speaker of the House James Wright ensured that Reagan would not reappoint Gray.

Gray’s successor, M. Danny Wall, was a Republican political staffer whose boss, Senator Jake Gran, after a single meeting with Keating had his number and refused to ever meet with him again. But the lesson Wall took from seeing Gray reduced to roadkill at the hands of Speaker Wright and the Keating Five was to never block the road when powerful thieves and their political cronies are racing down that road and eager to run you over.

Wall first took the unprecedented step of removing our (the FHLBSF) jurisdiction over Lincoln Savings and gave Keating a sweetheart deal. Wall’s critical, Neville Chamberlain-like order to his senior staff to reach an “amicable resolution” with Keating (which, given Keating, meant “surrender”) occurred immediately after a meeting with Keating. Wall’s meeting with Keating, in turn, occurred immediately after Keating met with Senator Glenn and Speaker Wright. Keating and Wright used their after-lunch meeting to plot how to get me fired and sued. Keating hired private investigators twice that we know of to try to find dirt on me.  Fortunately, I live a very Midwestern personal life. Keating eventually sued me for $400 million.

Keating, being Keating, started his meeting with Wall by noting that he had just met with Speaker Wright and Senator Glenn. Keating was capable of being subtle, but he preferred smash mouth football, so his next line, referring to the Speaker, was that “There’s someone you would have much better relationships with if you took care of your red-headed lawyer in San Francisco.” I still had bright red hair (and beard) at that time.

After getting rid (he thought) of the accursed FHLBSF regulators, Wall proceeded to force Joe Selby, the Nation’s most respected financial regulator, to resign as our top supervisor for Texas.  Selby’s sin was being a vigorous regulator. The Texas frauds targeted him for removal and successfully enlisted Speaker Wright’s enthusiastic support through contributions and by telling Wright that Selby was gay. Bank Board Chairman Gray, who personally recruited Selby and Mike Patriarca because of their reputations as the Nation’s best financial regulators, had placed Selby and Patriarca in charge of the two states with the worst fraud problems (Texas and California). Wall, while still a congressional aide, had urged Gray to fire Selby to placate the Speaker. Gray refused. Wall now publicly took “credit” for forcing Selby to resign or be fired.  Within months, Wall had removed or sidelined the Nation’s best financial regulators.

Keating’s successful extortion of Wall to remove the FHLBSF’s jurisdiction over Lincoln Savings did not work out well for Wall and the Keating Five for Keating used the sweetheart deal to intensify his looting of Lincoln Savings and its customers which led it to become the most expensive financial institution failure in U.S. history (at what now seems a quaint $3.4 billion), to sell worthless (and uninsured) junk bonds of Lincoln Savings’ insolvent holding company, and to target tens of thousands of widows for those sales. My extensive notes of the Keating Five meeting led to a Senate ethics investigation of the Keating Five. The Democratic Party Senate Committee colleagues on that investigation spent most of their energy attacking us, the regulators, for the high crime of criticizing Senators for aiding the Nation’s most notorious fraud loot the S&L and rip off widows. (Senators Cranston, Riegle, Glenn, and DeConcini were Democrats. Senator McCain was the lone Republican.)

The type of violations we had documented were invariably fatal. Keating had recruited the Keating Five through political contributions and through hiring Alan Greenspan as a lobbyist. Greenspan also served Keating as his outside economist to attempt to prevent the agency from adopting effective regulations to restrain looting by the Keatings of the world. In that capacity Greenspan had famously claimed that Lincoln Savings posed no foreseeable risk of loss to the FSLIC insurance fund.  Greenspan was slightly (as in 180º) off as I just explained.

But here’s the thing – given their ages, the lessons of the S&L debacle should have been the formative experiences for everyone involved in the most recent crisis. Wall resigned in disgrace in December 1989 after months of House hearings. The Senate ethics committee hearings on the “Keating Five” took place in 1990 and 1991.

“These [Senate ethics committee] hearings would take place from November 15 through January 16, 1991.[31] They were held in the Hart Senate Office Building‘s largest hearing room.[51] They were broadcast live in their entirety by C-SPAN, with CNN and the network news programs showing segments of the testimonies.[51] At the opening of the hearings, as The Washington Post would later write, ‘the senators sat dourly alongside one another in a long row, a visual suggestive of co-defendants in a rogues’ docket.’[52] Overall, McCain would later write, ‘The hearings were a public humiliation.’[51]

The committee reported on the other four senators in February 1991, but delayed its final report on Cranston until November 1991.”

Greenspan’s role was discussed in both the House and Senate hearings.

“Progressives” tend to roll their eyes in disgust at the entire “Whitewater” investigation, but two points are worth noting in terms of what the scandal should have taught the Clintons and their appointees. First, James McDougall, the CEO, looted Madison Guaranty through classic accounting control fraud techniques. (He was acquitted by a jury of one series of alleged bank frauds and convicted subsequently of other band frauds.)

James Clark, the Bank Board examiner-in-charge (EIC) of the 1986 examination of Madison Guaranty, testified in front of Congress about McDougall’s domination of the S&L and his massive multiple frauds. Clark’s testimony is devastating.

Second, McDougall’s frauds were made possible by the criminogenic environment created by the three “de’s” – deregulation, desupervision, and de facto decriminalization – and McDougall was brought to book when the regulators and prosecutors learned their lessons and got rid of the three “de’s.” The FSLIC was appointed the conservator for Madison Guaranty in February 1989.

Then first lady Hillary Clinton received substantial adverse publicity about her role not simply as an investor with but also as an attorney for the S&L.  She and her husband were publicly humiliated by the sex aspects of the investigation. Both Clintons, therefore, would logically have come out of the experience with a strong appreciation of how dangerous accounting control frauds are, why bank CEOs pose by far the greatest risk of fraud and do so through accounting fraud techniques (the fraud “recipe” for a lender) that require the lender to intentionally make large numbers of bad loans. This, in turn, requires the CEO to suborn the underwriting and internal controls. The Clintons should have had an acute appreciation of how critical underwriting is to avoiding banking crises. They observed first hand that the S&L debacle was driven by an epidemic of accounting control fraud.

Bill Clinton announced his candidacy for the Democratic Party’s nomination for President on October 2, 1991 – while the Senate Ethics committee was still wrapping up its investigation of the Keating Five. The S&L debacle was the defining scandal of the Clinton’s era and it was fresh in their minds as they made the run for the nomination and the presidency. We were convicting several hundred banksters and their cronies annually as Clinton prepared to run and actually ran his first campaign for the nomination and the presidency.

The same logic applies to Greenspan. He had to read our examination report and my report on why Lincoln Savings would be a disaster. My report emphasized the key role of its deliberately pathetic underwriting. Similarly, our presentation to the Keating Five emphasized the non-existent nature of Lincoln Savings’ underwriting on multi-million dollar loans. This was reprised in our testimony before the House and the Senate about Keating’s looting of Lincoln Savings.

But we know what the Clintons, their appointees, and Greenspan (originally a Bush I appointee) learned from the S&L debacle – nothing, or worse than nothing. Greenspan told the sycophantic author of Maestro that he would have done, said, and wrote the same things for Keating now that he did then based on the “facts.” I discuss later Greenspan’s actual approach to the “facts.”

Clinton’s Goal: Destroy the “Culture of Regulation”

But the Clintons and their bankster allies learned something far worse – the need to push the three “de’s” to ensure that never again would banksters and their political cronies be prevented from looting “their” banks or be held accountable for their looting. Bill Clinton, in his first major meeting with financial regulators (from the Office of the Comptroller of the Currency (OCC)) as President, chose to make these revealing remarks. One part of government most upset Clinton – the examiners who checked for threats to the safety and soundness of banks and businesses.

“The federal government to many people is not the President of the United States, it’s the person who shows up on the doorstep to check out the bank records, or the safety in the factory, or the integrity of the workplace, or how the nursing home is being run. I believe that we have a serious obligation in this administration to work with the Congress to reduce the burden of regulation and to increase the protection to the public. And we have an obligation on our own to do what we can to change the destructive elements of the culture of regulation that has built up over time….”

The federal examiners that expose the banks, workplaces, and nursing homes that engage in fraud or abuse provide a vital and unique service not only to the public, but also to honest competitors by blocking the “Gresham’s” dynamic that “control fraud” produces (bad ethics drives good ethics out of the markets). Clinton, however, is unaware of this dynamic. This type of regulation does not (net) “burden” honest businesses – it makes it possible for them compete by relieving them of the impossible burden of competing with control frauds. Clinton sees regulation not as episodically failing, but as the inherently flawed product of a “destructive” “culture of regulation.”  He started the process that replaced a “culture of regulation” with what even the anti-regulators now concede is the “culture of corruption” that dominates Wall Street and the City of London.

Clinton then singled out the worst examiners – bank regulators.

“When I was out in New Hampshire in 1992, I heard more grief about the regulation of the private sector by the Comptroller of the Currency than any other single thing. And now every time I go to New England, they say, we’re making money, we’re making loans, and we can function, because we finally got somebody down there in Washington who understands how to have responsible and safe banking regulations, and still promote economic growth. I hear it every time I go up there, and I thank you, sir, for what you’ve done on that. (Applause.)”

Vice-President Gore had already praised the OCC head, Gene Ludwig, for embracing the three “de’s.” Gore was particularly impressed that the bankers’ lobbyists were praising Ludwig. Readers will vary on what they infer from that praise, but Gore thought the only possible inference was that Ludwig’s deregulatory policies were superb.  When the bank lobbyists are praising you as a financial regulator you know you are on a path to disaster for the industry and the public. Bank lobbyists do not represent the interests of “banks” or their shareholders. They represent the interests of the banks’ controlling officers and when those CEOs create a culture of corruption the lobbyists will push policies that will make it easy for the CEOs’ to loot “their” banks with impunity through the “sure thing” of accounting control fraud.

Clinton launched an unholy war against effective financial regulation. He began the process, and bragged about, the massive cuts in the FDIC staff that eventually (Bush made it worse) led to the FDIC losing over three-quarters of its total staff and the OTS over half of its staff. FBI agents were reassigned from prosecuting the S&L frauds and such prosecutions largely ended in 1993. Clinton’s “reinventers” ordered us to refer to the industry as our “customer” and to treat them as if they were our “customer.”  Clinton’s reinventers eliminated the most important rule – the underwriting rule. They replaced it with a deliberately unenforceable “guideline” that was exceptionally criminogenic and would greatly intensify the epidemic of liar’s loans. This rule change was actually far more damaging than the more infamous statutory acts of deregulation that Bill Clinton, Rubin, and Greenspan pushed in order to essentially repeal the Glass-Steagall Act and pass the Commodities Futures Modernization Act of 2000 to not only kill Brooksley Born’s effort to protect the Nation and the world from financial derivatives, but ensure that no regulator in America would have any ability to regulate effectively massive classes of derivatives.

Clinton’s key economic appointees, and Gore, were fervent proponents of the three “de’s.” They came from banking and represented the interests not of banks, but of the banksters. Robert Rubin, the former head of Goldman Sachs and Clinton’s Treasury Secretary exemplified the bankster representing the interests of his peers. In particular, they pushed the global regulatory “race to the bottom” – warning that any effective financial regulation would drive the bankers to relocate to the City of London.

While anyone open to reality would have learned the grave dangers of the three “de’s” and the enormous value of effective regulation, there were three excellent reasons for the Clinton/Gore administration to be closed to reality and to embrace the three “de’s” and the banksters. First, it is not pleasant to be the subject of a government investigation and a conservatorship for your friend, business partner, and legal client’s S&L. It is perfectly human to react by being enraged at regulators. It was effective banking examiners who stopped McDougall’s frauds, conducted the bulk of the investigations that led to McDougall being convicted, and led to the exposure of the “Whitewater” “scandal.” From the Clintons’ perspective, that represented “Strike One, Strike Two, Strike Three – You’re Out!”

Second, the Clintons and Gore were leaders of the Democratic Leadership Council (DLC). The DLC’s creed was that the three “de’s” were divinely inspired. It was revealing that Clinton chose Gore as his running mate. Gore provided neither geographic nor ideological diversity to the ticket. Clinton did not want ideological diversity. He wanted a loyal junior partner who shared his disdain for regulators. It would require unusual independence of thought for Clinton and Gore, in their moment of electoral triumph, to say: “we’ve been observing the S&L debacle and thinking hard about its implications for our anti-regulatory policies and we have been forced to conclude that the DLC dogmas we have long championed about the virtues of the three ‘de’s’ are not simply incorrect but dangerous to the Nation.” Humans are more likely to do what Clinton and Gore did – religiously ignore the lessons of the S&L debacle and surround themselves with zealous advocates of the three “de’s.”

Third, the DLC had a special place in its heart for big finance. Big finance had the big money to make contributions, but it also had CEOs who were often at least moderate on social issues. These big contributors had been there in the DLC’s corner since its founding in 1985. How likely was it that Clinton and Gore, its two greatest DLC beneficiaries, would turn on big finance in their moment of triumph?

Hillary Clinton Learned the Same Perverse Lessons as Bill about Financial Regulation

I thank Samantha Lachman for her April 9, 2015 column entitled “As Clinton Tries To Win Over Progressives, She Might Want To Distance Herself From This Economic Adviser.” I hope that my column will not seem too harsh, but I feel the need to point out the key ways in which my analysis differs from Lachman’s – each of which adds to her thesis.

Lachman’s column explains that Hillary Clinton chose Robert Hormats as one of her most prominent economic advisors. Lachman points out that Hormats is a rabid deficit (and war) hawk, wants to cut the safety net, supports the faux “free trade” agreements that the Rubin-wing of the Democratic Party constantly seeks to inflict on the Nation, and favors aggressive deregulation. Lachman warns that this will cause progressives to wonder whether they should support Hillary Clinton. Lachman’s sole substantive argument against Hormats’ support for deregulation is that if she were to adopt his policy recommendations it would inhibit efforts were H. Clinton to be elected to reduce inequality.

“Hormats, who was the undersecretary for economic, energy and environmental affairs from 2009 to 2013, has advocated for the deregulatory approach that was begun by the Reagan administration and continued by former President Bill Clinton. Progressives say this deregulatory strategy contributed to widening income inequality….”

Lachman is correct about the content of Hormats’ policy positions. But here are the key factors I would urge readers (and potential campaign supporters and voters) to consider that arise from these positions.

  1. The problem with Hormats is not that he will upset “progressives.” The problem is that he is incompetent, dishonest, and supports policies that have devastated and will continue to devastate our Nation and the people of the world. Hormats has been wrong on every important economic issue – for decades. That should upset everyone regardless of their politics.

The insoluble problem is that every time Hormats’ policies cause a disaster and his dogmas are falsified he doubles-down on his failures. He does so because he is so dogmatic and intellectually dishonest that he refuses to learn from even his most catastrophic mistakes – and because his policy disasters enrich him and his peers – the elite banksters.

The enormous problem with Hormats’ policies is not that his policies “contributed to widening income inequality” (though they did) – but that they blew up the financial system, our Nation’s economy, and the global economy. In the U.S. 9.3 million Americans lost their jobs and roughly six million jobs that would have been created absent the Great Recession were not created. The leading economic estimate is that the U.S. will lose $24 trillion in GDP as a result. The job and GDP losses are far larger in Europe due to the insanity of self-inflicted austerity. If Hormats had been able to secure his desire to inflict austerity on America our job and GDP losses would have at least doubled.

Worse, Hormats’ policies blew up the financial system because they made it so “criminogenic” that it produced the three great fraud epidemics by bankers (appraisal, “liar’s” loans, and secondary market fraud) that hyper-inflated the bubble and caused the catastrophic fraud losses that drove the financial crisis.

Worse still, while he had a front row seat to these frauds epidemics as Goldman Sach’s Vice Chairman, he not only failed to warn the Nation about them but encouraged ever more criminogenic heapings of the three “de’s” – deregulation, desupervision, and de facto decriminalization.

And, still worse, Hormats continues to push for those same policies because while they were a catastrophic failure for our Nation and the world, they make him and his peers (many of them criminals) immensely wealthy – and will do so in the future when his policies again crush our Nation in an orgy of fraud by the banksters. Hormats doubtless supports (formal) legal civil rights (as opposed to the reality), which makes him a member in good standing of the Rubin-wing of the Democratic Party, but his economic policies are to the right of the UK Tories’ policies that Paul Krugman correctly eviscerates for their economic illiteracy.

I will discuss only two examples of Hormats’ incompetence as an economist, neither of which Lachman explores. First, he championed and aided the “Scandalous Seven.”

  1. Hormats’ continuing support for the three “de’s” and his support for President Clinton’s reappointment of Alan Greenspan and President Obama’s reappointment of Ben Bernanke to head the Fed. There are seven U.S. public officials who embraced the three “de’s” and are most culpable for creating and refusing to stop the criminogenic environment that produced the three most destructive epidemics of financial fraud in history. Those fraud epidemics hyper-inflated the bubbles, drove the financial crisis, and caused the Great Recession.  Clinton, Gore, Rubin (with a dishonorable mention to his protégé Larry Summers), Greenspan, President George W. Bush, Bernanke, and Timothy Geithner are the U.S. officials who failed so spectacularly in the run-up to the crisis that they deserve their inclusion on my list of the Scandalous Seven. I am talking here about the public sector. The elite bankers who led the fraud schemes are even more culpable for they were made wealthy by their fraud schemes.  

The terrible thing about the seven officials is that none of them had to be bribed in any overt fashion that could ever lead to even an investigation much less a prosecution. (The finance industry, of course, finds ways to richly reward its political cronies.) The Scandalous Seven felt wonderful about their actions in creating and then ignoring the criminogenic environment. Like Hormats, their embrace of the three “de’s” was open, not furtive. Three of the officials were Republicans and four were from the Rubin-wing of the Democratic Party. Geithner is a special case who became a nominal Rubin-Democrat to get his position as Treasury Secretary in the Obama administration.

Lachman’s discussion of the Hormats’ support for Greenspan and deregulation emphasizes that Greenspan “is loathed by progressives.”

“Similarly, in a discussion of whether former Federal Reserve Chairman Alan Greenspan should be reappointed by then-President George W. Bush, Hormats said Greenspan, who is loathed by progressives, had done ‘a terrific job.’

‘He enjoys respect on both Main Street and Wall Street,’ Hormats said. ‘In short, he’s really been one of the great financial leaders in American history.’

In the same conversation, Hormats argued that while Greenspan had facilitated a positive economic climate, other factors, including deregulation, were also responsible for private sector growth.

‘[Greenspan] has power, but what’s really driving this economy is the dramatic change that’s taking place in the private sector in this country,’ he continued. ‘We’ve had government deregulation, which has held.’”

A technical note, Lachman is quoting from an NPR transcript and the audio is no longer available on the web site. I suspect that the last word, “held,” should read “helped.”  Lachman does not explain why “progressives” loath Greenspan – or why such loathing should be limited to “progressives.” If “progressives” loath Greenspan for bad reasons then this represents a defect on their part, not a failure by Greenspan or Hormats. In the same interview Lachman is quoting, Robert Reich issued a vibrant endorsement of Greenspan’s reappointment by Clinton that included one of the funniest (unintentional) descriptions of Greenspan: “Alan Greenspan is a pragmatist, an empiricist.” When it came to regulation to stop the fraud epidemics, I show below that Greenspan was still Ayn Rand’s faithful cultist. He was dogmatic and rather than an “empiricist” he religiously refused to allow real data to be presented.

Here are the primary reasons Greenspan (and Bernanke) make my list of the Scandalous Seven.

  • The Fed had the unique authority under HOEPA (enacted in 1994 under Clinton) to ban all “liar’s” loans – regardless of whether they were originated by federally insured lenders. As the name implies, such loans were known to be pervasively fraudulent and it was known that lenders and loan brokers overwhelmingly put the lies in liar’s loans. Greenspan, and then Bernanke, refused to use this authority to stop an obvious, massive epidemic of “accounting control fraud. The FBI’s senior agent in charge of dealing with mortgage fraud, Chris Swecker, warned in September 2004 that there was an “epidemic” of mortgage fraud developing and predicted that it would cause a financial “crisis” – and Greenspan refused to stop the fraud epidemic. Greenspan’s colleague, Governor Gramlich, warned Greenspan of the developing epidemic of bad loans and urged him to send the Fed examiners in to the sleazy bank holding company affiliates that were pumping out hundreds of thousands of fraudulent loans. Greenspan refused not only to stop the fraudulent loans – he refused to send the examiners in to find the facts. When Richard Spillenkothen, the Fed’s top supervisor, requested to brief the full Fed board on the fact that every major bank involved with Enron had eagerly aided and abetted Enron’s accounting fraud and tax evasion the senior leadership of the Fed was enraged – at its supervisors! While Spillenkothen does not name individual names, this could not have occurred without Greenspan’s active support.

When another Fed supervisor, Sabeth Siddique, several years later presented the Fed board and Regional Bank Presidents with data from the Nation’s largest banks showing that they were moving massively into making loans that were known to be pervasively fraudulent and exceptionally likely to default the Fed split into a civil war in which the supervisor was subjected to “personal” attacks – for providing data from the banks to the Fed!

“Some people on the board and regional presidents . . . just wanted to come to a different answer. So they did ignore it, or the full thrust of it,” [Federal Reserve Governor Bies] told the Commission.

Within the Fed, the debate grew heated and emotional, Siddique recalled. “It got very personal,” he told the Commission. The ideological turf war lasted more than a year, while the number of nontraditional loans kept growing….” (FCIC 2011: 20-21).

This is significantly insane. The Fed leadership, under Greenspan and Bernanke, was so dogmatic and passionate in its hatred for regulation, supervision, enforcement, and prosecution and so rabid in its faith in “markets” and the inherent sainthood of financial CEOs that it conducted an unholy war against its own supervisors and reality.  Simply providing data from the industry to the leaders of your agency became a CLG for Fed supervisors (“career limiting gesture”).

It is important to recall four other matters in this context. We (OTS-West Region) figured out liar’s loans in 1991 – and drove them out of the S&L industry, which was the limits of our statutory powers (unlike the Fed after the passage of HOEPA in 1994). We got it right because unlike Greenspan and Bernanke we were reality-based regulators eager to get the facts. So we listened to our examiners (as we had in 1984 about prior epidemics of accounting control fraud). The loans were not yet called “liar’s” loans by the industry and there was very limited experience with “low documentation” loans but our examiners realized that failing to underwrite the borrower’s income had to lead to “adverse selection” and produce severe losses. We realized that only fraudulent CEOs running accounting control frauds would make liar’s loans.  Greenspan and Bernanke had no need to reinvent the supervisory wheel and the disastrous loss data on the 1990-1993 experience with liar’s loans was available to them.  Banning liar’s loans was one of the easiest calls any regulatory could make. There was zero upside to liar’s loans – they harmed every honest borrower.

The second fact is that Greenspan was no virgin when it came to accounting control fraud. As I explained above, Charles Keating, the most notorious S&L fraud, used him as a lobbyist to recruit the five U.S. Senators who became known as the “Keating Five” when they met with us on April 9, 1987.

The third fact is that in addition to the FBI’s 2004 warning that the developing mortgage fraud “epidemic” would cause a financial “crisis” if it were not stopped the appraisers had created an extraordinary warning in the form of a public petition explaining that fraudulent lenders were deliberately creating a “Gresham’s” dynamic (in which bad ethics drives good ethics from the markets and professions) by extorting appraisers’ to inflate the value of homes pledged as collateral – something only a fraudulent bank or loan broker officer would do. The following astonishing fact is revealed (but also buried) well into the report of the Financial Crisis Inquiry Commission (FCIC): “Swecker, the former FBI official, told the Commission he had no contact with banking regulators during his tenure” (FCIC 2011: 164, emphasis added). As a former financial regulator I am almost reduced to tears every time I read that sentence.

  1. Put yourself in the position of Greenspan, Bernanke, Geithner, and Bush – all in office when Swecker made his very public warnings in the media and his Congressional testimony in 2004. There is no possible excuse for their total refusal to act against a crime wave led by elite banksters. Worse, their obscene attacks on supervisors to prevent them from presenting these senior officials with the reality of the three raging fraud epidemics demonstrates that they were not simply cowards unwilling to stop a wave of crime by their powerful cronies. These four officials’ war on the facts was so intense because they knew that if they ever let reality intrude it would falsify their ideological dogmas and render disgraceful their slavish lifetime devotion to the banksters.

The fourth fact is that within months of Bernanke’s ascendancy to running the Fed he knew from the MARI/MBA report that the available data showed that 90% of liar’s loans were fraudulent. He refused to use HOEPA to ban liar’s loans.

  1. Greenspan also makes the list for his dogmatic position expressed to CFTC Chair Brooksley Born that preventing fraud was never a legitimate basis for regulation.
  1. The real problem is the Clintons.

First, H. Clinton chose Hormats – in 2009 – to be her key economic adviser at State at a time when, for the reasons I just explained, it was inescapable that he three “de’s” (championed by Hormats) had produced the three most damaging financial fraud epidemics in world history, destroyed the global financial system (it was resurrected only by massive public bailouts by the Treasury and the Fed), and caused the Great Recession.

Hormats was still pushing the three “de’s” under H. Clinton. She knew this before she recruited him to be one of her top lieutenants at State. Hormats proceeded to continue to shill for the three “de’s” at State – with no known reprimands from H. Clinton. As I have often noted, economics has the very useful concept of “revealed preferences.” Lachman’s focus is on Hormats’ revealed preferences, but the key is that we are observing H. Clinton’s true preference. She picked a known, serial incompetent who was a disaster in his supposed area of expertise (finance) and so dogmatic, intellectually dishonest, and dedicated to the interests of his fellow 1% that he continues to double-down on his failures. Lachman warns H. Clinton that to curry favor with progressives “She Might Want To Distance Herself From This Economic Adviser.” But that is not what any progressive should want. Progressives (and everyone else) should be demanding that she repudiate, not merely “distance herself from” Hormats’ dogmas. It does nothing good for the world if H. Clinton is able to deceive people by making it appear that she has ditched disastrous deregulatory dogmas by keeping Hormats at a “distance” while she actually maintains those same dogmas.

What H. Clinton should be doing, in alliance with Senator Warren, is leading the charge demanding that the Obama Administration honor the whistleblowers who made public the massive frauds by Citi, JPM, and Bank of America’s senior managers and prosecute the banksters. That would be great substantively for America and smart politics. The Clintons have been conspicuously silent about the banksters and the fraud epidemics they led that drove our crises. She could fix that in 15 minutes – if she wished to.

Second, as I explained above, the Clinton administration enthusiastically embraced the three “de’s” through the “Reinventing Government” movement. Al Gore led the charge. I have written about this extensively. Reinventing government was expressly designed not to prosecute elite corporate criminals. Yes, the Bush administration that followed was even worse, but it was Clinton who began what Tom Frank aptly terms The Wrecking Crew. I got out as a regulator when the “Reinventers” ordered us to refer to the industry we were supposed to regulate as our “customer” – and to treat banks and bankers as if they were “customers.” I personally witnessed this directive, and the administration’s chief goon in charge of its oxymoronic “Reinvention” proudly cites that directive as one of his top accomplishments and prints praise of his supposed bravery in insisting on that directive.

Hormats was not a powerful adviser to the Clinton administration. Bob Rubin, Goldman Sachs’ CEO, was the paramount adviser on economic matters. Hormats is simply one of dozens of Rubinites that infested the Clinton and Obama administrations. But blaming the three “de’s” on Rubin is unfair, for B. Clinton and Gore were sincerely and zealously committed to deregulation, desupervision, and the de facto decriminalization of elite white-collar crime. Neither was seduced by Rubin. H. Clinton knows as much as any person alive about the Rubinites’ pathologies. She recruited Hormats because he was a Rubinite, not because he deceived her.

At one point, all six of Obama’s most senior economic advisers where Rubinites. (They are still overwhelmingly Rubinites.) Obama and H. Clinton have chosen Rubinites as their dominant economic advisers not through some sinister, secret infiltration engineered by Rubin, but because Obama and the Clinton represent the Rubin-wing of the Democratic Party.

Third, H. Clinton chose Hormats as a top adviser not because of his “expertise” – she knows he has been consistently, horrifically wrong about every important economic policy issue on which he has opined in the last 20 years – but as a signal to the donors, the elite bankers. The signal is that I have always been with you and will always be with you, regardless of the bleating of the Democratic-wing of the Democratic Party.

I have explained Hormats’ incompetence when it came to regulation. I will add briefly related displays of incompetence in what he purports to be his fields of expertise.  First, he wants to cut the already inadequate safety net for the purpose of reducing budget deficits. Consider his testimony before the House Budget Committee on June 26, 2007. The setting was a friendly one. The Democrats controlling the Committee held a hearing to embarrass the Bush administration. The Democratic meme was that unlike virtuous Clinton, Bush had taken us deep into deficit – and much of our national debt was owed to the Chinese (cue dramatic, pulsating minor key music foreshadowing disaster). I know that many “progressives” would think that such a hearing was fantastic – good politics plus hoisting the Republican’s fiscal conservatives on their own petard.

I’ll simply refer readers to my colleagues’ explanations of why the “Red Peril” fearmongering is nonsense. It is terrible economics and Democrats shouldn’t try to score political points by spreading economic lies – even if the Democrats are right that the Republicans do so routinely.

I think that the hearing and Hormats’ testimony demonstrated the idiocy and dishonesty of many Democrats. Recall the date of the hearing – the U.S. was racing into the Great Recession. It officially began in the Fourth Quarter of 2007. By the time Hormats testified roughly five nonprime lenders were failing every week and housing prices had been falling for over a year in many markets. The U.S. needed to be running far larger federal budget deficits to begin to counter the coming recession. Instead, we had Hormats testifying that July 26, 2007 would be a great time for the U.S. to simultaneously “boost savings at home,” cut safety net payments (Social Security, Medicare, and Medicaid), and return the federal budget to surplus. Each of these actions would have further reduced already inadequate demand and caused the Great Recession to come sooner, be deeper, and last far longer – because that is what austerity does when you add it to a recession.

Hormats:  Not Cutting Grandmother’s Social Security Will Get Her Nuked

Hormats was just getting started with his plan to ruin America. He claimed that we had to adopt these three self-destructive policies that would hurl us into an earlier, deeper, and longer recession (and therefore increase the budget deficit) to protect ourselves from a terrorist WMD attack.

“Because we know that one of the stated objectives of terrorists is to cause massive disruption in the U.S. economy, such financial vulnerabilities could lead potential perpetrators to feel that they can do a great deal of damage not simply by their initial act, but also because of the secondary and tertiary economic disruptions that would occur because of the subsequent turmoil in a more vulnerable financial environment. In finances as in military affairs, vulnerability frequently invites aggression.”

Hormats’ position was refuted by an earlier speaker that looked a whole lot like Hormats who only about 30 seconds earlier testified that “It is worth recalling that the country had recorded four years of budget surplus before 9/11….” Indeed, it would have been “worth recalling” by Hormats who only 30 seconds later claimed that we could greatly reduce the risk of terrorist attacks if we ran budget surpluses. Hormats displayed at this hearing that he is not simply incompetent, he is a shill willing to say anything, no matter how loony, to please the Democratic politicians who might again make the mistake of appointing him to office.

In the same testimony, Hormats also indicated that he is a “finance expert” who is clueless about the actual financial system of a nation with a sovereign currency, i.e., the U.S.

“Alexander Hamilton recognized from the very beginning that America’s financial strength was vital to its security. If the country did not manage its finances well, he reasoned, it would not have the resources needed to defend itself in time of war and it would lose credibility in the eyes of creditors, making borrowing in time of war or other national emergency all the more difficult.

Over two centuries have passed since Hamilton held office, but these principles are just as relevant today.”

Well, no, not even close. On a more technical detail, his “Red Peril” scenarios assume that the U.S. can only fund itself through issuing bonds. My colleagues have explained in loving detail in NEP why Hormats’ claims demonstrate that he does not understand even the most basic aspects of how money actually works. I do not demand that Hormats agree with MMT, but he does have to understand the actual operations by which money can be created to be minimally competent in his field. As I explained, one does not make a Rubinite an adviser because one is seeking competence.

April 20, 2015 Posted by | Corruption, Timeless or most popular | , , , , , , , , , , | 1 Comment

US extends $4bn Israel loan program

Al Akhbar | October 25, 2012

The United States agreed on Wednesday to extend its $4 billion loan guarantee program to Israel until 2016, a gesture that shows continued commitment to the Jewish state less than two weeks before the American presidential elections.

The move allows the United States to provide up to $3.8 billion in future loan guarantees, as part of a $9 billion commitment made by the US in 2003.

The program was meant to expire this year.

The American Secretary of the Treasury Timothy Geithner and Doron Cohen, the director general of the Israeli finance ministry, signed the agreement during a US-Israel Joint Economic Development Group meeting in Washington, according to Israeli newspaper Haaretz.

“The loan guarantees agreement attests to the special economic relationship between Israel and US,” said Yuval Steinitz, Israel’s finance minister.

“I welcome the growing cooperation between the two countries, especially their treasuries,” Steinitz added while thanking Geithner.

The loan guarantees are independent of $10 billion in annual US military assistance to Israel and joint US-Israel missile defense projects. In 2007, US President George W. Bush agreed to a 10-year military aid package costing $30 billion.

According to a March 2012 report by the Congressional Research Service, Israel is “the largest cumulative recipient of US foreign assistance since World War II.” The report alleges that Israel had received $115 billion from the United States to date, most of it in the form of military assistance.

The report also stated that US financial assistance to Israel is typically delivered within the first 30 days of the fiscal year, whereas most other recipients receive aid in installments.

Scandal surfaced in Washington earlier this month after 15 church leaders sent a letter to Congress asking for an investigation to ensure American military aid to Israel was not used to commit human rights violations against Palestinians.

The Jewish Council for Public Affairs responded by canceling a long-planned interfaith meeting and by issuing an outraged public statement, in which JCPA President Rabbi Steve Gutow accused the enquiry of being part of “relentless attacks on the Jewish state” and a sign of “vicious anti-Zionism that has gone virtually unchecked in several of these denominations.”

Presidential incumbent Obama and his contender Mitt Romney have competed in displays of loyalty to the Jewish state over the course of the election campaigns, mentioning Israel dozens of times during the last presidential debate on Monday, which centered on foreign policy. The debate was devoid of criticism of Israel’s repeated human rights abuses against Palestinians.

Obama has hailed Israel as “a true friend and our greatest ally in the region,” later adding that he “will stand with Israel if they are attacked.” Meanwhile, Romney has expressed similar sentiments, his website going so far as to call Israel “a beacon of democracy and freedom in the [Middle East].”

October 25, 2012 Posted by | Ethnic Cleansing, Racism, Zionism, Illegal Occupation | , , , , , | 5 Comments

Adam Davidson’s Journalistic Corruption: NPR Host Boosts for Wall Street, While Taking Undisclosed Banking Money

By Yasha Levine and Mark Ames • S.H.A.M.E. • August 8, 2012

“I feel like the voice of business journalism is sort of, it’s an authoritative voice of God.”

—Adam Davidson

Adam Davidson is the co-creator and host of the popular economic news radio program Planet Money. On air, Davidson plays the role of an earnest, brainy reporter who’s doing his best to make sense of the complicated, jargon-filled world of finance to report business news in a way that NPR listeners can understand. However, behind the dweeby, faux-naive facade Adam Davidson presents to his listeners, is a shrewd propagandist with a long, consistent history of shilling for powerful and destructive interests—and failing to disclose his financial ties to the companies and industries he reports on.

Over the years, Davidson has boosted for the Iraq War and whitewashed the occupation of Iraq, praised sweatshop labor and “experimenting on the poor,” attacked the idea of regulating Wall Street, parroted libertarian propaganda about the government’s inability to directly create jobs, argued for “squeezing the middle class,” and shamelessly fawned over Wall Street for allegedly blessing Americans with “just about anything that makes you happy.” (Read Adam Davidson’s full S.H.A.M.E. profile.)

While Adam Davidson has recently come under increasing scrutiny for using his NPR platform to promote the narrow interests of the super-wealthy in this country, little attention has thus far been given to Davidson’s corruption—his numerous financial conflicts of interest that seriously undermine his claims to being a journalist, and instead reveal Davidson as a glorified product spokesman for his Wall Street sponsors.

Adam Davidson gained national media recognition as an on-air personality in 2008, after co-producing an episode for This American Life called “The Giant Pool of Money” about the implosion of subprime lending. Although Davidson’s segment was praised for making the murky world of finance easier to understand, his framing of the subprime housing debacle served another purpose: It let Wall Street off the hook for its role in rampant criminal mortgage fraud and predatory lending.

“This was a crisis that was caused by willing participation of every single person. Nobody was coerced,” said Davidson’s co-producer and partner in Planet MoneyAlex Blumberg. “And there was fraud. But that was not what caused the crisis. What caused the crisis was something bigger and more systemic that required the involvement of everybody at every step.”

This evasion-by-exaggerating-the-complexity strategy is one that Davidson and Planet Money have deployed often to whitewash and deflect the role of criminality in the housing crisis. Among the show’s fans was Treasury Secretary and former New York Federal Reserve Bank chief Timothy Geithner: “Yeah, they did a good job.”

As a piece of journalism, Davidson’s report on the subprime fraud was a failure bordering on journalistic malpractice. By absolving the role of rampant predatory criminality and spreading blame in a grand false equivalency, Davidson provided a narrative frame that comforted the American Establishment at a time when it badly needed comforting, and was duly rewarded for his services. The mainstream media joined Timothy Geithner in lavishing praise on Davidson’s subprime fraud whitewash, and awarded him and his partner with the prestigious “Peabody Award” while New York University’s Journalism Institute named the segment one of the “Top Ten Works of Journalism of the Decade.”

Thanks to this broad acceptance and praise of Davidson’s whitewash, he was given his own show, which launched just as the entire financial system began to meltdown.

The new show, called Planet Money, was a partnership between NPR and Chicago Public Media’s This American Life, and was molded on Davidson’s successful subprime episode. Not surprisingly, Planet Money was compromised almost from the very start.

In early 2009, just a few months after Planet Money was launched, NPR announced it had secured Ally Bank (formerly GMAC) as the show’s exclusive sponsor. It was an unusual setup for NPR, and unusual (and highly dubious) for anything that called itself journalism, because it meant  that a major, troubled financial institution was the only source of money for a news program about finance. At the time that the unusual agreement was signed, Planet Money was the only NPR program underwritten by a single exclusive sponsor. The arrangement raised eyebrows and would have been unthinkable before the crisis—but even by post-crisis funding arrangements, Planet Money’s deal with Ally Bank stood out as such an obvious violation of basic journalism standards that even Ad Age, the advertising industry’s trade publication, was taken aback by the “close alignment of message and news program.”

To understand why Davidson’s arrangement with Ally Bank is so odious, a little background is needed. Ally Bank is a subsidiary of Ally Financial, a giant financial services company formerly known as GMAC. There’s a good reason why GMAC would have wanted to change its name to “Ally Financial” after the financial collapse: The bank is one of the biggest mortgage servicers in the country, and has been one of the very worst offenders in foreclosure fraud and in the very same subprime fraud that Davidson whitewashed as a “blameless” phenomenon. GMAC deserves far more blame—and jail time—than any of the subprime borrowers it fleeced and ruined. Since GMAC collapsed in late 2008, it has received more than $17 billion of taxpayer bailout funds in a series of bailouts. As of August 1, 2012, 74% of Ally Financial was still owned by the U.S. Government. [ 1 ]

At the time Ally signed its sponsorship agreement with Planet Money, the bank was being investigated across the country for foreclosure fraud, robo-signing fraud, and student loan fraud. Even as bad bailed-out banks go, GMAC/Ally is considered one of the worst, most tainted of them all.

GMAC goes from thief to Ally…

Planet Money‘s relationship with Ally is a textbook example of “conflict of interest” of the sort every journalist is taught to shun. The bank had a clear and demonstrable interest in Planet Money‘s coverage of the financial industry, especially issues that affected the bank’s bottom line. As Planet Money‘s sole sponsor at a time when NPR funds were falling, Ally obviously wielded considerable power.

After Davidson sprang a vicious and bizarre smear-attack on Elizabeth Warren in 2009, some NPR listeners started to get wise to Planet Money‘s corruption problem, and made their concerns known. Following months of complaints from readers pointing to the conflict-of-interest and the way Planet Money‘s segments dovetailed with the banking lobby’s own propaganda—and with Ally’s interests—NPR’s Ombudsman was forced to issue a public statement on the Ally-Planet Money relationship. Perhaps not surprisingly, the NPR Ombudsman decided that listeners’ concerns over the conflict-of-interest were “cynical”—as if the problem lay in listeners’ psychology, rather than in Planet Money’s violation of basic journalism ethics. The NPR Ombudsman went further, arguing essentially that if listeners who complained about corruption weren’t cynical, then they were ignorant.

Despite Davidson’s long experience in sales and underwriting for public radio, he claimed he was out of the loop when it came to the deal his own show, Planet Money, cut with its sole sponsor, Ally Bank: “I have nothing to do with the underwriting stuff. We don’t pay any attention to the fact that they are a sponsor. We wouldn’t for a second give them any special treatment — positive or negative.”

And yet, the actual record proves that NPR readers were right to suspect and criticize the arrangement, and that Davidson was wrong in claiming that Planet Money has not consistently pushed a narrative so in synch with Ally Bank and the financial industry that it boggles the mind how he has gotten away with it. Planet Money coverage hasn’t just been friendly to banks and the finance industry in general—some of it has been suspiciously lined up and in synch with specific policy priorities of its exclusive sponsor, Ally Bank.

One example: In 2009, just as Planet Money inked its exclusive sponsorship deal with Ally Bank, Davidson began broadcasting a number of segments critical of the proposed Financial Consumer Protection Agency Act of 2009, questioning the need  to regulate consumer financial products like mortgages and credit cards in order to protect people against bank fraud. “Will it work at all?” Davidson asked in one of his fake “gee-whiz” questions. “Is this just one more layer of regulation in a regulatory system that fundamentally broke down?”

In May 2009, in the heat of the banking industry’s massive pushback, Davidson essentially mugged Elizabeth Warren, the chief architect of the financial consumer protection bill, in an interview that took a sharp and bizarre hostile turn early on. Davidson surprised Warren and his own listeners with uncharacteristic personal smears, trying to portray her as a clueless, power-hungry ideologue. Davidson’s attack on Warren was so out-of-line and uncharacteristically hostile that it sparked a torrent of criticism from NPR listeners who couldn’t understand why Davidson or NPR would do such a thing. Keep in mind, this was in the spring of 2009, when unemployment was still shooting through the roof, the future of the economy was in doubt, and talk of a 1930s style Great Depression-2 was still front-and-center.

It’s worth going back and listening to the interview to get a sense of just how malevolent Davidson really was, and is. Here’s an excerpt, courtesy of Corrente:

ADAM DAVIDSON: What it feels to me is what you are missing is that — I think we put aside your pet issues. We put them aside. We put them aside until this crisis is over.

ELIZABETH WARREN: The cr– What you’re saying makes no sense. Now come on. [interpolate Davidson sputtering and attempting to interrupt throughout.] It makes no sense. On an emergency basis, on one day, one week, one month, there’s no doubt in my mind we’ve got to step in, we’ve got to make sure we have a functioning banking system. I think I’ve said that like nine times now. Of course we’ve got to have a functioning banking system.

DAVIDSON: Wait a minute. I want to make you go farther. I want to make you madder before I —

ELIZABETH WARREN: No no no. [Davidson snickers] We’re now at what — we’re now seven, eight months into this. And it’s the second part of what you said. We can’t do anything about the American family until this crisis is over? This crisis will not be over until the American family begins to recover. [More Davidson sputtering.] This crisis does not exist independently —

DAVIDSON: That’s your crisis.

ELIZABETH WARREN: No it is not my crisis! That is America’s crisis! If people cannnot pay their credit card bills [Davidson tries to interrupt] if they cannot pay their mortgages —

DAVIDSON: But you are not in the mainstream of views on this issue. You are not —

ELIZABETH WARREN: What, if they can’t pay their credit card bills the banks are gonna do fine? Who are you looking at?

DAVIDSON: The [sputters]–

ELIZABETH WARREN: Who says a bank a bank is going to survive — Who is not worried about the fact that the Bank of America’s default rate has now bumped over 10%? That’s at least the latest data I saw. So the idea that we’re going to somehow fix the banks and then next year or next decade we’re going to start worrying about the American family just doesn’t [Davidson talking over] make any sense.

DAVIDSON: The American families are not — These issues of crucial, the essential need for credit intermediation are as close to accepted principles among every serious thinker on this topic. The view that the American family, that you hold very powerfully, is fully under assault and that there is — and we can get into that — that is not accepted broad wisdom. I talk to a lot a lot a lot of left, right, center, neutral economists [and] you are the only person I’ve talked to in a year of covering this crisis who has a view that we have two equally acute crises: a financial crisis and a household debt crisis that is equally acute in the same kind of way. I literally don’t know who else I can talk to support that view. I literally don’t know anyone other than you who has that view, and you are the person [snicker] who went to Congress to oversee it and you are presenting a very, very narrow view to the American people.

The Columbia Journalism Review described the Planet Money interview as a “disaster” and  “really cringeworthy stuff from Davidson,” who was so rude and unprofessional that NPR’s Ombudsman was forced to issue a public apology for his behavior. Davidson’s excuse: he had been traveling for a NPR fundraiser and was “very, very tired.”

What Adam Davidson did not disclose to the public was that at the same time he was smearing Elizabeth Warren and attacking legislation that would protect consumers against the sort of bank fraud that has devastated millions of Americans, Ally Bank, the sole sponsor underwriting Davidson’s Planet Money show and his salary, was simultaneously spending hundreds of thousands lobbying against the  Financial the Consumer Protection Agency Act of 2009.

Evidence: Here’s just one of GMAC’s lobbying disclosure forms mentioning the Consumer Financial Protection Agency Act of 2009

Ally Bank is not the only financial company funding Adam Davidson’s career, and filling up his bank accounts.

On top of Ally Bank’s exclusive sponsorship of Planet Money, Davidson earns lucrative speaking fees from banks and financial companies, including J.P. Morgan, Well Fargo, Bank of America and Goldman Sachs—the same companies he covers as a journalist. Davidson is frequently the only journalist/reporter booked to speak at these events; other speakers usually work in finance.

Davidson has yet to disclose his corporate clients and how much they pay him, but here is a partial list of Davidson’s speaking gigs from the last two years compiled from various publicly available sources:

  • In April 2011, Davidson was the headlining speaker at the 9th Annual “Women’s World Banking” Microfinance and the Capital Markets Conference. The conference was hosted by J.P. Morgan, but the organization itself is funded by the world’s biggest banks and corporations, including BP, Morgan Stanley, Pfizer, Barclays Capital, VISA, ExxonMobil—just to name a few.
  • In 2011, Davidson spoke at another microfinance conference, this once was also funded by Morgan Stanley, Citi, Bank of America, Deutsche Bank and CapitalOne.
  • In 2012, Davidson spoke at the 27th Annual Conference for the Treasury & Finance Professional. Sponsors of the event included Bank of America, BlackRock, BNY Mellon, Bloomberg, Citibank, Findelity Investments, Goldman Sachs, J.P. Morgan, Morgan Stanley, Well Fargo and about a dozen of the most powerful financial the largest financial companies in the world.

These speaking fees are a huge unaddressed problem in news media and academia. As explained by Charles Ferguson, director of Inside Job and author of Predator Nation, the problem with speaking fees is that they are “sometimes used to launder or disguise payments . . . for lobbying and policy advocacy.” That is why, for example, Obama’s former economy czar Larry Summers was roundly criticized for taking hundreds of thousands of dollars in speaking fees in 2008 from the same banks he was bailing out in 2009.

Chicago Public Media, which co-owns “Planet Money” through its ownership of “This American Life”, explicitly bars conflicts-of-interest: “WBEZ journalists must uphold the trust of the public by not overlapping individual interests with professional responsibilities. WBEZ journalists may not accept any form of compensation from the individuals, institutions or organizations they cover.”

Neither NPR nor This American Life would comment on S.H.A.M.E.’s investigation into Adam Davidson’s conflicts of interest. We will be seeking to get comment from Davidson’s other employer, The New York Times, about their policy on journalists having conflicts-of-interest.

Notes

See Naked Capitalism’s coverage of GMAC/Ally’s mortgage fraud.

August 8, 2012 Posted by | Corruption, Deception, Economics, Mainstream Media, Warmongering, Timeless or most popular | , , , , , , | 2 Comments