Fold/Spindle/Mutilate 2.1

Why the Hold-Up in Connecticut’s Investigation into Ann Coulter’s ‘Voter Fraud’?

State officials say case of alleged voting improprieties in 2002 and 2004 ’still pending’ nearly five months since complaint filed…

Posted By Brad Friedman

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Matt Taibbi on how Goldman Sachs has engineered every major market manipulation since the Great Depression

MATT TAIBBI

In Rolling Stone Issue 1082-83, Matt Taibbi takes on “the Wall Street Bubble Mafia” — investment bank Goldman Sachs. The piece has generated controversy, with Goldman Sachs firing back that Taibbi’s piece is “an hysterical compilation of conspiracy theories” and a spokesman adding, “We reject the assertion that we are inflators of bubbles and profiteers in busts, and we are painfully conscious of the importance in being a force for good.” Taibbi shot back: “Goldman has its alumni pushing its views from the pulpit of the U.S. Treasury, the NYSE, the World Bank, and numerous other important posts; it also has former players fronting major TV shows. They have the ear of the president if they want it.” Here, now, are excerpts from Matt Taibbi’s piece and video of Taibbi exploring the key issues.

Matt Taibbi On Goldman Sachs’ Big Scam

From Matt Taibbi’s “The Great American Bubble Machine” in Rolling Stone Issue 1082-83.

The first thing you need to know about Goldman Sachs is that it’s everywhere. The world’s most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.

Any attempt to construct a narrative around all the former Goldmanites in influential positions quickly becomes an absurd and pointless exercise, like trying to make a list of everything. What you need to know is the big picture: If America is circling the drain, Goldman Sachs has found a way to be that drain — an extremely unfortunate loophole in the system of Western democratic capitalism, which never foresaw that in a society governed passively by free markets and free elections, organized greed always defeats disorganized democracy.

They achieve this using the same playbook over and over again. The formula is relatively simple: Goldman positions itself in the middle of a speculative bubble, selling investments they know are crap. Then they hoover up vast sums from the middle and lower floors of society with the aid of a crippled and corrupt state that allows it to rewrite the rules in exchange for the relative pennies the bank throws at political patronage. Finally, when it all goes bust, leaving millions of ordinary citizens broke and starving, they begin the entire process over again, riding in to rescue us all by lending us back our own money at interest, selling themselves as men above greed, just a bunch of really smart guys keeping the wheels greased. They’ve been pulling this same stunt over and over since the 1920s — and now they’re preparing to do it again, creating what may be the biggest and most audacious bubble yet.

See Taibbi discuss Goldman Sachs’ big scam.

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By Brad Friedman

UPDATED: Alaskan reporter Shannyn Moore offers The BRAD BLOG hints about reasons for Alaska Gov’s resignation

FURTHER UPDATE: Sources say embezzlement scandal, federal indictments may soon break concerning use of Wasilla Sport Complex building materials for Palin’s home…

[See update below for exclusive source details from Alaska...FURTHER UPDATE now added below: AK sources say 'embezzlement' scandal, federal indictments may be in offing. See below...]

Palin resigns. She was to have been in office until 2010. Something else is going on here above and beyond what she’s saying, though I don’t know what yet. Josh Marshall seems to agree, noting in his “first signs of what happened” coverage:

[T]his clearly happened so quickly that Palin hasn’t even had a chance to come up with a coherent cover story for her resignation. … Remember that based on the public record, Palin is a wildly unethical public official, guilty at a minimum of numerous instances of abusing her authority as governor. And a lot of very damaging information has come out about her in the last few days — though mainly embarrassing information about her character rather than new evidence of bad acts. I would not be surprised if this latest round of revelations shook something else loose that we haven’t heard about yet.”

I’d expect another shoe to drop very soon here…Looking into it…More shortly here…

UPDATE: Alaskan Sarah Palin authority (and occasional BRAD BLOG guest blogger) Shannyn Moore, who broke the news at HuffPo today, tells me she believes, with good reason, that there is an “iceberg scandal that’s about to break. She’s doing damage control.”

She says Palin is “resigning as part of damage control” due to a scandal that is “not of a family nature.” …

“The governor would not be able to continue her job when it comes out,” she told me on the phone just now, before adding: “Why would Mark Sanford not resign, but Sarah Palin did? Her family didn’t even know about the resignation until they were standing with her by the lake” when she made her announcement.

Yes. It seems another shoe, apparently a big one, will indeed be dropping, likely within the next week or so. Perhaps earlier now that everyone will be poking around up there.

FURTHER UPDATE: Okay, I’ve now been able to get independent information from multiple sources that all of this precedes what are said to be possible federal indictments against Palin, concerning an embezzlement scandal related to the building of Palin’s house and the Wasilla Sports Complex built during her tenure as Mayor. Both structures, it is said, feature the “same windows, same wood, same products.” Federal investigators have been looking into this for some time, and indictments could be imminent, according to the Alaska sources.

The BRAD BLOG has not been able to receive confirm from any federal sources on this. Our information comes from local Alaskans who follow Palin, and who have been keeping an eye on this for some time, while keeping it quiet at the request of federal investigators.

A bit more now follows the video below…

* * *With all of the above in mind, her rather manic, rather rambling, rather bizarre announcement (as seen below, via RAW STORY, text transcript here), seems to make a bit more sense, I’d say…

* * *LATE UPDATE: It appears that the questions about Palin’s house and the sports complex made their way through the media and blogosphere during the campaign last October. “Glic” over at DailyKos has collected some of the notable coverage from back then, including these details from the Village Voice on 10/8/08…
THE $12.5 MILLION sports complex and hockey rink that is the lasting monument to Palin’s two terms as Wasilla mayor is also a monument to the kind of insider politics that dismays Americans of both parties. Six months before Palin stepped down as mayor in October 2002, the city awarded nearly a half-million-dollar contract to design the biggest project in Wasilla history to Kumin Associates. Blase Burkhart was the Kumin architect on the job-the son of Roy Burkhart, who is frequently described as a “mentor” of Palin and was head of the local Republican Party (his wife, June, who also advised Palin, is the national committeewoman). Asked if the contract was a favor, Roy Burkhart, who contributed to her campaign in the same time frame that his son got the contract, said: “I really don’t know.” Palin then named Blase Burkhart to a seven-member builder-selection committee that picked Howdie Inc., a mostly residential contractor owned at the time by Howard Nugent. Formally awarded the contract a couple of weeks after Palin left office, Nugent has donated $4,000 to Palin campaigns. Two competitors protested the process that led to Nugent’s contract.

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By Yasmin El-Sharif

The emirate of Qatar is waiting for Porsche and Volkswagen to settle their power struggle, but its patience will eventually run out, insiders say. Even if it ditches its plans to buy a stake in either firm, though, the wealthy Gulf state still has its sights set on investments in Germany.

The telephones have been ringing off the hook for weeks. From Doha to Volkswagen’s headquarters in Wolfsburg or to Porsche’s base in Zuffenhausen near Stuttgart — German automakers cherish the calls from Qatar’s capital city.

Sights set on German industry — the Emir of Qatar, Sheikh Hamad bin Khalifa al-Thani.

There’s no decision yet on whether the emirate will end up buying a stake in Porsche or in Volkswagen, the two carmakers locked in an escalating power struggle. While the two carmakers rush out public statements almost every day, Qatar is keeping mum, which begs the question what the country is planning.Little is known of its business plans but it’s clear that the tiny country with a population of just 250,000 has embarked on a shopping spree in Europe, and is showing particular interest in Germany. Like many other Gulf states, Qatar wants to reduce its dependence on oil production by snapping up Western know-how and securing stakes in key Western industries.

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How About Independence Day from Corporations Controlling Our Government? Now That Would be Change We Could Believe In.

By Mark Karlin

Our hearts and spirits soared as Barack Obama was swept into the White House in a landslide on election day in 2008.

It was one of those historic moments of hope, of the dark cloud of the Bush-Cheney years being lifted from our shoulders, of a desire for a restored democracy being fulfilled, of a candidate worthy of our great nation being elected.

During the days leading to the Inauguration and the cherished ceremony itself, we soared with the elation of a great experiment in governance, innovation, and freedom being vindicated and restored.

But then we were disgusted and horrified by how Wall Street was paid ransom welfare to keep an economy from entirely collapsing that they had gambled away.  We saw President Obama surround himself not with populist economic advisors that would restore financial power to Main Street, but rather with the very architects of America’s riverboat gambler financial swindles and collapse, many of them from Goldman Sachs which Matt Taibbi just definitively revealed as a predator financial institution.

And if there is any doubt that the multi-national “globalist” corporations — who have left the American worker to rot – control Congress, just look at how much Obama’s “audacity of hope” has turned into the mush of “compromise.”  Ironically, the audacity and hope have definitely been on the side of the “K Street” lobbyists representing the wealth that controls our Congress and our national domestic economic policies for the most part.

Christopher Hedges wrote a remarkably insightful article, “The Corporate Media State Has Deformed American Culture — Time to Fight,” the other day about how corporations – through advertising, media and branding –control the “frame” through which far too many Americans see the issues facing us.  Corporate “mainstream media” basically positions critical issues in their interests and their “take” becomes the mindset of the D.C. elite, advanced by propaganda news ”reporting,” advertising and lobbying.

In the face of this onslaught, Barack Obama’s rhetoric and strategy — except for some relatively minor social changes in regulations and laws — have relatively wilted.  Obama too is now the vassal of the greater powers than those of the Presidency: the control of the majority of Congressional members by corporate contributions and influence.  The President is the second most powerful force in the nation: the corporations are first.  The people are distant also-rans who only count in the next-election vote mathematics of any elected official — and elected officials figure they can win them over with slick commercials and empty promises.

That brings me to my “mad as Hell” day editor’s blog.  I had to lay off a senior editor at BuzzFlash who is a fantastic writer, editor and brought so much to the progressive cause because we otherwise would have shut down due to lack of funds.

Over the years, literally thousands of members of our BuzzFlash community have supported the growth of our site — and the exciting unique model of progressive commerce (changing the way we consume), supporting progressive and populist journalism.  It’s not just talking about change and writing meaningless “petitions” to compromised congressional representatives and senators; it’s also about creating change through the very financial model of synergisitcally supporting small progressive companies that are eco- or economically justice minded through their start ups, as well as celebrating our progressive culture through books and other premiums from larger companies.

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Germany’s military deployment in Afghanistan has split public opinion back home. SPIEGEL talks to former German Defense Minister Peter Struck and Jürgen Todenhöfer, a prominent critic of the war, about civilian victims of American bombing attacks, negotiations with the Taliban and the role of al-Qaida.

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Democratic Congressional candidate Francine Busby.

by: Eric Kleefeld |  Visit article original @ Talking Points Memo

Now this is a truly bizarre story, about a Democratic Congressional candidate’s fundraising event being raided by a whole squad from the San Diego Sheriff’s Department – including pepper spray and a helicopter!

The San Diego Union-Tribune reports that a fundraiser for Francine Busby, who previously ran for the deeply-Republican Fiftieth District and came close to winning in the 2006 special election and subsequent regular election, was raided by sheriffs after an unnamed neighbor made a noise complaint. Busby now calls it a “phony” noise complaint, and the article says that multiple neighbors said there was no great noise at all.

Here’s the twist: The fundraiser was hosted by a lesbian couple, and shortly before the sheriffs came a particular neighbor had shouted anti-gay slurs at the assembled crowd. “It was a quiet home reception, disrupted by a vulgar person shouting obscenities from behind the bushes,” Busby says.

As one neighbor told the paper: “We didn’t hear anything until the sheriff came, with eight patrol cars and a helicopter.”

The sheriff’s department claims that somebody kicked an officer. By the time it was over, multiple people were pepper-sprayed, one of the hostesses was arrested, and the whole neighborhood got to see quite a scene.

One of the officers defended the department’s conduct – turning the blame on the candidate: “The place got out of hand. If Francine Busby was there, why not take a leadership role, step up, and nip this thing in the bud?”

Late Update: An earlier version of this post referred to “tear gas.” It has been changed to “pepper spray” to be more clear and specific.

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Les Leopold, The Looting of America: How Wall Street’s Game of Fantasy Finance Destroyed Our Jobs, Pensions, and Prosperity. Chelsea Green Publishing, 2009. 220 pp.

Great teachers love metaphors. To help learners grasp the unfamiliar, great teachers — like Les Leopold, the founder of the respected Labor Institute in New York — latch on to realities students already understand. Leopold has been using metaphors, for decades, to help working men and women understand how our economy really works.

But two years ago, amid the gathering Wall Street storms, Leopold suddenly realized that, as a teacher, he really didn’t understand the high-finance “innovations” just then beginning to crash into the headlines, the CDOs and the swaps, the tranches and the quants.

So Leopold set about to educate himself on Wall Street’s innards, and now he’s sharing what he has learned — in an energizing and remarkably entertaining new book, The Looting of America.

The book’s core, perhaps not surprisingly, revolves around a delightfully insightful metaphor. If you really want to comprehend how Wall Street has melted down our economy, Leopold suggests, give a look to fantasy baseball.

In fantasy baseball, groups of baseball fans create their own “teams” and stock them with players they pick from lists of real-life baseball players. If the players you pick for your fantasy team do well on the real-life baseball diamond — if they hit lots of homers, for instance — your fantasy team will do well.

Your fantasy team, in effect, “derives” value from real baseball. You have no actual relationship to this real baseball. But you can still make money, playing fantasy baseball, if the real-life players you pick for your fantasy team put up better numbers than the players your fantasy league competitors pick.

“In effect,” explains Leopold, “you are speculating on the stats derived from real major league players, but those players don’t know they’re playing on your team.”

This same sort of speculation, over recent years, has been driving Wall Street. We have “fantasy finance.” Bankers and traders have created a sticky global web of “derivatives” — collateralized debt obligations, credit default swaps, and more — that bear the same relationship to the “real” economy as fantasy baseball bears to real balls and strikes.

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Former President George W. Bush with Iraqi Prime Minister Nouri al-Maliki at a press conference in December 2008.

by: William Rivers Pitt, t r u t h o u t | Columnist

It began more than six years ago with a lie, followed by another lie, and another lie, and then two more, ten more, a hundred, a thousand, an avalanche of lies from heads of state and hatchet men and well-fed media types more interested in getting the interview than in getting the facts.

It began with lies like this:

“Simply stated, there is no doubt that Saddam Hussein now has weapons of mass destruction.”

– Dick Cheney, Vice President Speech to VFW National Convention 8/26/2002

… and this:

“We don’t want the smoking gun to be a mushroom cloud.”

– Condoleezza Rice, US National Security Adviser CNN Late Edition 9/8/2002

… and this:

“We know for a fact that there are weapons there.”

– Ari Fleischer, Press Secretary Press Briefing 1/9/2003

… and this:

“We know that Saddam Hussein is determined to keep his weapons of mass destruction, is determined to make more.”

– Colin Powell, Secretary of State Remarks to the UN Security Council 2/5/2003

… and this:

“We know where they are. They’re in the area around Tikrit and Baghdad and east, west, south and north somewhat.”

– Donald Rumsfeld, Secretary of Defense ABC Interview 3/30/2003

It began with George W. Bush standing before both houses of Congress and an international television audience for his January 2003 State of the Union address and stating that Iraq was in possession of 26,000 liters of anthrax, 38,000 liters of botulinum toxin, 500 tons – which is one million pounds – of sarin, mustard and VX nerve agent, 30,000 missiles to deliver the stuff, mobile biological weapons labs, al-Qaeda connections and uranium from Niger for use in a robust nuclear weapons program.

Lies. All lies. 4,321 American soldiers have died in Iraq because of those lies, 101 during this year, including Sgt. Timothy A. David of Michigan, who was killed on June 28 when an improvised explosive device detonated near his vehicle. Four more soldiers were killed in Iraq on Tuesday in the midst of the withdrawal. Tens of thousands of American soldiers have been shredded and maimed because of those lies. Nobody knows how many innocent Iraqis have been killed and wounded because, to this day, we don’t do body counts. Estimates range from tens of thousands to hundreds of thousands to perhaps more than a million, depending on who you ask, all because of those lies.

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Claire and Larry Yurdin filed for bankruptcy when his insurance didn’t cover his medical bills.

By REED ABELSON

Health insurance is supposed to offer protection — both medically and financially. But as it turns out, an estimated three-quarters of people who are pushed into personal bankruptcy by medical problems actually had insurance when they got sick or were injured.

And so, even as Washington tries to cover the tens of millions of Americans without medical insurance, many health policy experts say simply giving everyone an insurance card will not be enough to fix what is wrong with the system.

Too many other people already have coverage so meager that a medical crisis means financial calamity.

One of them is Lawrence Yurdin, a 64-year-old computer security specialist. Although the brochure on his Aetna policy seemed to indicate it covered up to $150,000 a year in hospital care, the fine print excluded nearly all of the treatment he received at an Austin, Tex., hospital.

He and his wife, Claire, filed for bankruptcy last December, as his unpaid medical bills approached $200,000.

In the House and Senate, lawmakers are grappling with the details of legislation that would set minimum standards for insurance coverage and place caps on out-of-pocket expenses. And fear of the high price tag could prompt lawmakers to settle for less than comprehensive coverage for some Americans.

But patient advocates argue it is crucial for the final legislation to guarantee a base level of coverage, if people like Mr. Yurdin are to be protected from financial ruin. They also call for a new layer of federal rules to correct the current state-by-state regulatory patchwork that allows some insurance companies to sell relatively worthless policies.

“Underinsurance is the great hidden risk of the American health care system,” said Elizabeth Warren, a Harvard law professor who has analyzed medical bankruptcies. “People do not realize they are one diagnosis away from financial collapse.”

Last week, a former Cigna executive warned at a Senate hearing on health insurance that lawmakers should be careful about the role they gave private insurers in any new system, saying the companies were too prone to “confuse their customers and dump the sick.”

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An insurance company “is supposed to honor its commitments and stand by you in your time of need,” Rep. Bart Stupak (D-Mich.) said.

Lawmakers ask three executives if they’ll stop dropping customers except where they can show “intentional fraud.” All say no.

By Lisa Girion

Executives of three of the nation’s largest health insurers told federal lawmakers in Washington on Tuesday that they would continue canceling medical coverage for some sick policyholders, despite withering criticism from Republican and Democratic members of Congress who decried the practice as unfair and abusive.

The hearing on the controversial action known as rescission, which has left thousands of Americans burdened with costly medical bills despite paying insurance premiums, began a day after President Obama outlined his proposals for revamping the nation’s healthcare system.

An investigation by the House Subcommittee on Oversight and Investigations showed that health insurers WellPoint Inc., UnitedHealth Group and Assurant Inc. canceled the coverage of more than 20,000 people, allowing the companies to avoid paying more than $300 million in medical claims over a five-year period.

It also found that policyholders with breast cancer, lymphoma and more than 1,000 other conditions were targeted for rescission and that employees were praised in performance reviews for terminating the policies of customers with expensive illnesses.
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The pattern is inescapable: she takes disagreements personally, and swiftly deals vengeance on enemies, real or perceived.

Despite her disastrous performance in the 2008 election, Sarah Palin is still the sexiest brand in Republican politics, with a lucrative book contract for her story. But what Alaska’s charismatic governor wants the public to know about herself doesn’t always jibe with reality. As John McCain’s top campaign officials talk more candidly than ever before about the meltdown of his vice-presidential pick, the author tracks the signs—political and personal—that Palin was big trouble, and checks the forecast for her future.

By Todd S. Purdum

The crowds begin streaming into the Evansville Auditorium and Convention Centre a couple of hours before the arrival of the “special guest speaker” at the Vanderburgh County Right to Life dinner on a soft Indiana spring evening—nearly 2,200 people in the banquet hall, 800 more in an adjacent auditorium watching the proceedings on a live video feed. The menu is thick slices of roast pork and red velvet cake, washed down with pitchers of iced tea, and when Sarah Palin finally enters, escorted by a phalanx of sheriff’s deputies and local police, she is mobbed. The organizers of the dinner, billed as “the largest pro-life banquet in the world,” have courted Palin for weeks with care packages of locally made chocolates, doughnuts, barbecue, and pastries, and she has requited by choosing Evansville, a conservative stronghold in southern Indiana, as the site of her first public speech outside Alaska in 2009. Like Richard M. Nixon, who chose the coalfield town of Hyden, Kentucky, for his first post-resignation public appearance, Palin has come to a place where she is guaranteed a hero’s reception. She is not only a staunch foe of abortion but also the mother of a boy, Trig, who was born with Down syndrome just a few months before John McCain chose Palin as his running mate. The souvenir program for this evening’s dinner is full of displays for local politicians and businesses, attesting to their pro-life bona fides. An ad for Hahn Realty Corporation reads, “If you need commercial real estate, call Joe Kiefer! Joe is pro-life and a proud supporter of the Vanderburgh County Right to Life.”

As Palin makes her way slowly across the crowded ballroom—dressed all in black; no red Naughty Monkey Double Dare pumps tonight—she is stopped every few inches by adoring fans. She passes the press pen, where at least eight television cameras and a passel of reporters and photographers are corralled, and spots a reporter for a local community newspaper getting ready to take a happy snap with his pocket camera. For a split second she stops, pauses, turns her head and shoulders just so, and smiles. She holds the pose until she’s sure the man has his shot and then moves on. A few minutes later, the evening’s nominal keynote speaker, the Republican Party’s national chairman, Michael Steele, who has been reduced to a footnote in the proceedings, introduces the special guest speaker as “the storm that is the honorable governor of the great state of Alaska, Sarah Palin!”

Just where that storm may be heading is one of the most intriguing issues in American politics today. Palin is at once the sexiest and the riskiest brand in the Republican Party. Her appeal to people in the party (and in the country) who share her convictions and resentments is profound. The fascination is viral, and global. Bill McAllister, until recently Palin’s statehouse spokesman, says that he has fielded (and declined) interview requests from France, England, Italy, Switzerland, Israel, Germany, Bulgaria, “and probably other countries I’ve forgotten about.” (Palin, keeping her distance from most domestic media as well, also declined to talk to V.F.). Whatever her political future, the emergence of Sarah Palin raises questions that will not soon go away. What does it say about the nature of modern American politics that a public official who often seems proud of what she does not know is not only accepted but applauded? What does her prominence say about the importance of having (or lacking) a record of achievement in public life? Why did so many skilled veterans of the Republican Party—long regarded as the more adroit team in presidential politics—keep loyally working for her election even after they privately realized she was casual about the truth and totally unfit for the vice-presidency? Perhaps most painful, how could John McCain, one of the cagiest survivors in contemporary politics—with a fine appreciation of life’s injustices and absurdities, a love for the sweep of history, and an overdeveloped sense of his own integrity and honor—ever have picked a person whose utter shortage of qualification for her proposed job all but disqualified him for his?

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Arthur Delaney
arthur@huffingtonpost.com | HuffPost Reporting

People across the United States are sharing their personal stories with Barack Obama’s repurposed campaign arm, Organizing For America, to tell the world about the failures of the U.S. health care system. Some people say they would almost rather die than deal with it.

Joan in Washington, D.C. wrote that she fears she and her husband will be homeless if he can’t find a job, and that she is “uninsurable” because of cancer.

“Maybe I should wish for the cancer to kill me sooner — it might be a better option,” Joan wrote. “I am terrified.”

Jackie in Logan, N.D., wrote that she cried when she was hospitalized in January out of fear for the bills — even though she has health insurance.

“I told my husband that perhaps I should just go home and wait to die,” Jackie wrote, “as it would be cheaper to be cremated, than to have to exist dealing with the debt of surviving.”

Brad of Granite City, IL, wrote that “I may die any day because Health Insurance isn’t available to me.”

“For profit healthcare killed my wife,” wrote John of Nashville, Tenn.

These notes are just a few of “hundreds of thousands” of stories submitted, according to an official with Organizing for America. The site, called “Health Care Stories for America,” was launched last week as a counterbalance to claims that the administration’s agenda for health care reform will create a government-run bureaucracy that will make you wait in line for a doctor. As many of the stories on the OFA site demonstrate, the current system kind of sucks already.

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Eliot Spitzer
Former Governor of New York

If the senior Wall Street bankers and Washington decision makers who can move billions of dollars with a single conference call want to understand what is truly happening in the economy, they should sit down with small business people like Peter Elliot, the owner of a clothing store in New York City for the past 35 years. Peter prides himself on the craft of selling and marketing products made in America. He has built his business that way. He is the salt of the earth, a Veteran who retired with the rank of Captain in the Army, rugged but charming, salesman and proselytizer, southern gentleman and New York tough, all at once.

And he is seething with anger. Once he employed 29, now 14. Once he had a solid line of credit with a major bank, now they have cut it off – even though in 35 years, he never missed a payment, and was late – by four days – only once. Once he had faith in the basic decency of the leaders at the major banks and Wall Street firms that allocated capital and stoked the engine of our economy. No longer.

Just to be clear, his anger has nothing to do with the fact that he is now struggling. He is a survivor, and he has built a business over too many decades, seen too many peaks and valleys, had a life filled with the complications we all face, to be thrown off his game by any of those realities. No, it is rather the deep sense of unfairness about how the plutocracy has handled the crisis that eats at him. The sense that we have lost the basic sense of decency that used to define how we addressed issues of national crisis – with a common sense of sharing of both the upside and the down.

Peter grabbed me a few days ago as I was strolling past his store, bathed in sweat from a three-mile run. His store window, on Madison Avenue, was, as always, neatly bedecked with an attractive array of jackets, shirts, sweaters, ties, and assorted accompanying articles of clothing. Understand, Peter has built this store, and a few others, with grit, charm, and perseverance. Through ups and downs, he sold on thin margins, talked up the quality of his domestic products over mass produced imports, took raw college grads and turned them into effective salespeople before they moved on to the world of law or business. He told them that they would learn everything they needed to know to be successful if they could sell on the shop floor – how to read a customer, appreciate value, close a deal, massage an ego.

Once inside, he asked a simple question: How can they do this to me? How can a bank that has received tens of billions of tax dollars – whose very survival was guaranteed by a massive infusion of the tax dollars he and countless millions of others like him pay – how could that bank now rely on a pretext to cut his line of credit so he couldn’t finance his ongoing payroll, acquire next season’s merchandise, and pay for some expansion plans he had.

Their decision forced him to lay off half his employees and go to his vendors for help. His vendors, with whom he had a relationship for decades, all agreed to work with him – they understood the mutual interest in keeping each other going through the rough patch. But they all agreed – the banks were heinous institutions, and if they could get a pound of flesh out of them, they would. After all, these small businesses had all been playing by the rules, and it wasn’t the greed of small business that had led the banks to create credit default swaps, pretend that sub-prime debt was really AAA rated, or originate debt that had no hope of repayment. It wasn’t the small business owners who took out gobs of money in bonuses and back-dated options.

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Keith Thomson

I would guess that in the past year, there were more regime-change-in-Iran plots floated by members of the intelligence community than there are Iranians.

During that time, research for my novel Once A Spy (Doubleday, 2010) brought me into contact with an array of intelligence community personnel ranging from analysts to CIA Director Michael Hayden. On a scale of 1 to 10, I would estimate their overall enthusiasm for a change of regime was a 9. Among Israeli intelligence officers (who didn’t exactly cotton to Mahmoud Ahmadinejad’s dismissal of the Holocaust as a myth or to his frequent mentions of the end of the Zionist regime and Iran’s nuclear program in the same breath), the average was 12.

Still, the consensus on actively promoting regime change was: “Let’s wait and see what happens in the election in June.” After all, the United States hasn’t had the easiest time installing new foreign governments lately (see: Iraq). And certainly not in Iran (see: Shah, The).

What was the intelligence community’s best-case scenario? Short of outright regime change or Ahmadinejad climbing aboard a missile and accidentally launching himself at Pyongyang Strangelove-style, we are now witnessing it: An election leaving the Iranian people–and the world–outraged.

According to former CIA case officer Fred Rustmann, “If we were doing our job, and I’m not sure we are, we would be knee deep into supporting opposition factions in Iran and would be able to claim at least partial credit for what’s going on there today.”

“The agency’s political warfare capability has been dead since the days of Bill Casey,” says John Lenczowski, the president of the Institute of World Politics whose extensive foreign policy résumé includes Director of European and Soviet Affairs for the National Security Council.

Regardless, Rustmann and Lenczowski say, the CIA may now help set Tehran’s smoldering tinder ablaze by supplying the opposition factions with money, intel, press placement, and weapons–perhaps the most potent of which may be BlackBerrys.

“What we could do immediately is essentially manipulate Iranian media, especially the media that serves the Iranian diaspora,” says the former CIA operations officer who goes by–and wrote an espionage memoir under–the pseudonym Ishmael Jones. “The internet-driven communication between Iranians worldwide and those in Iran is frenetic.”

“The CIA already has a cooperative program in place with [certain American publications],” he adds. “Reporters from [those publications] meet regularly with the top CIA officials–not a conspiracy hatched in a smoke-filled room, but the natural result of reporters working hard to develop top-level sources within the CIA. Just switching [those reporters] for journalists who serve the Iranian diaspora would do the trick. These journalists will be eager to [cooperate]. The CIA must certainly have extensive and true information about Iranian government corruption. This information, supplied by Iranian diaspora journalists, would be read within hours by ordinary Iranians and would strengthen resistance to the current regime.”

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Huffington Post Investigative Fund |  Ben Protess

When President Obama unveiled his regulatory overhaul plan last week, the Commodities Futures Trading Commission, or CFTC, dodged a bullet.

Lacking power, the agency has only gently regulated the derivatives markets, which have been blamed for wreaking havoc on the global economy. Rather than abolish the agency, however, Obama proposed strengthening it.

A week later, not all reformers are convinced that the plan is comprehensive enough and, more so, doubt the CFTC is capable of recovering from its long legacy of deregulation. A look back at that legacy explains the skepticism.

“The CFTC was left with the responsibility for policing fraud and abuse and had no tools to do that,” said Barbara Roper, the director of investor protection for the Consumer Federation of America.

The agency’s reputation has been so damaged that shortly before Obama’s announcement, the administration signaled that the CFTC and SEC would join forces. (The two agencies currently split oversight of derivatives).

But the merger never made it into the final plan. It met opposition in Congress, where the CFTC still maintains strong allies on the agricultural committees.

So Obama instead asked the two agencies to reconcile their differences and cover holes in their oversight. This week, in a move that pleased many advocates of financial reform, they released a blueprint for greater regulation of derivatives.

The CFTC’s job was not always so complicated. The agency was created in 1974, primarily to oversee commodity futures contracts. This type of derivative allows investors to buy a commodity, often an agricultural product like wheat, at a fixed price and date.

Soon the futures industry expanded beyond commodities, making it more complex and harder to control.

But the CFTC lacked the teeth and size to take on new responsibilities. And some in the agency who had close ties to industry wanted it that way.

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Ex-Insider Testifies to ‘Fear Tactics’

By David S. Hilzenrath
Washington Post Staff Writer

Health insurers have forced consumers to pay billions of dollars in medical bills that the insurers themselves should have paid, according to a report released yesterday by the staff of the Senate Commerce Committee.

The report was part of a multi-pronged assault on the credibility of private insurers by Commerce Committee Chairman John D. Rockefeller IV (D-W.Va.). It came at a time when Rockefeller, President Obama and others are seeking to offer a public alternative to private health plans as part of broad health-care reform legislation. Health insurers are doing everything they can to block the public option.

At a committee hearing yesterday, three health-care specialists testified that insurers go to great lengths to avoid responsibility for sick people, use deliberately incomprehensible documents to mislead consumers about their benefits, and sell “junk” policies that do not cover needed care. Rockefeller said he was exploring “why consumers get such a raw deal from their insurance companies.”

The star witness at the hearing was a former public relations executive for major health insurers whose testimony boiled down to this: Don’t trust the insurers.

“The industry and its backers are using fear tactics, as they did in 1994, to tar a transparent and accountable — publicly accountable — health-care option,” said Wendell Potter, who until early last year was vice president for corporate communications at the big insurer Cigna.

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By William Greider

The most disturbing thing about Barack Obama’s call for financial reform was the way in which the president falsified our predicament. He tried to make it sound as though everyone was implicated in the financial breakdown and therefore no one was really to blame. “A culture of irresponsibility took root from Wall Street to Washington to Main Street,” Obama explained. “And a regulatory system basically crafted in the wake of a 20th century economic crisis–the Great Depression–was overwhelmed by the speed, scope and sophistication of a 21st century global economy.”

That is not what happened, to put it charitably. Unlike some other presidents, Obama is much too intelligent not to know this. The regulatory system was not overwhelmed by historic forces. It was systematically gutted and dismantled by the government in Washington at the behest of the banking interests. If Obama wants details, he can consult his economic advisors–Summers-Geithner–who participated directly as accomplices in unwinding the prudential rules and regulations. Cheers were led by the Federal Reserve with heavy lifting by both political parties.

The president’s benign version of events reminds me of what compliant politicians and opinion leaders said after the war in Iraq they had endorsed turned disastrous. “Hey, we were all fooled.” If Obama were to tell the truth now about what went wrong in the financial system, he would face a far larger political problem trying to clean up the mess. Instead, he has opted for smooth talk and some fuzzy reforms that effectively evade the nasty complexities of our situation. He might get away with this in the short run. Congress doesn’t much want to face the music either. But Obama’s so-called reform is literally “kicking the can down the road,” as he likes to say about other problems. In the long run, it will haunt the country because it fails to confront the true nature of the disorders.

Giving more power to the Federal Reserve to be the uber-regulator of banking and finance is a terrible idea (I examine the dangers in a forthcoming Nation article). Asking the cloistered central bank to resolve all the explosive questions about the over-reaching power of financial institutions is like throwing the problem into a black box and closing the lid, so people will be unable to see what happens next. That is the idea, after all, the reason Wall Street’s leading firms first proposed the Fed as super-cop, then sold it to George W. Bush and now Barack Obama. Give the mess to the Wizard of Oz, the guy behind the curtain. He can do miracles with money, but don’t watch too closely. This constitutes the high politics of evasion.

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Banking “broken,” consumers need help:

By Kevin Drawbaugh and Karey Wutkowski

WASHINGTON (Reuters) – The outspoken head of a U.S. Congressional watchdog panel will strongly urge lawmakers on Wednesday to set up a new government agency to protect consumers from “tricks and traps” set by banks.

President Barack Obama has called for creating an independent financial products agency to oversee consumer lending as part of his sweeping proposal to overhaul the U.S. financial regulatory system.

“We can help fix the broken credit market. And I can sum it up in four words: Consumer Financial Protection Agency,” said Elizabeth Warren, chairman of the Congressional Oversight Panel of the Troubled Asset Relief Program, in prepared remarks.

Warren, who is a professor at Harvard Law School, will be the marquee witness at a House of Representatives committee hearing on Wednesday looking at a key provision of Obama’s broad plan to drag the aging U.S. financial regulatory system into the 21st century.

The provision to establish a financial protection agency for consumers “will be carried out,” Senator Jack Reed, chairman of the Senate securities subcommittee, said in an interview with Reuters Television on Tuesday.

“Definitely you have to have a consumer protection agency,” he said, echoing vows made in recent days by Obama and by Senate Banking Committee Chairman Christopher Dodd on a proposal that is meeting more criticism from business interests than perhaps any other part of the Obama plan.

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