RON PAUL BLASTS OBAMA’S GLUTTONOUS MILITARY BUDGET AND CONTEMPT FOR CIVIL LIBERTIES.

by Robert Scheer by HUSTLER Magazine

I know it will come as an outrageous stretch to some, but Presidential aspirant Ron Paul reminds me a bit of George Washington. That’s because, upon ending his two-term tenure as the nation’s first President, the great Revolutionary War hero warned his countrymen to be on “guard against the impostures of pretended patriotism.” In Washington’s view, expressed all too clearly in that first Farewell Address, the most dangerous enemies of the new republic were not foreign armies but rather homegrown demagogues eager to betray our freedoms in the name of national security.

It was a warning reiterated by another great general-turned-President—Republican Dwight David Eisenhower—who in his own Farewell Address sounded the alarm against the “military-industrial complex,” which jeopardizes our freedoms while playing the patriotism card in pursuit of profit. The last time you heard a major party’s Presidential candidate issue a similar warning was in 1972, when George McGovern, who had been awarded the Distinguished Flying Cross for his heroism during Wold War II, was the Democratic nominee against that inveterate warmonger Richard Nixon.

Since then, Republicans and Democrats alike—particularly after the hysteria engendered by the 9/11 attacks—have cravenly catered to the whims of those beating the drums for bigger military budgets. Recently Barack Obama signed off on the $662-billion National Defense Authorization Act (NDAA), which also included provisions stripping away our fundamental freedoms in the name of stopping the terrorist enemy.

It remained for only one Republican primary challenger, the libertarian Ron Paul, to dare echo Eisenhower’s warning, telling an audience in Iowa soon after the Pentagon bill passed: “Watch out for the militaryindustrial complex—they always have an enemy. Nobody is going to invade us. We don’t need any more weapons systems.”

Why not? It has been almost two decades since the old Soviet Union collapsed, and then-President George H.W. Bush announced that the Cold War was over and ordered a one-third cut in defense spending as the springboard of a peace dividend.

It was a dividend we never got to enjoy because George H.W. Bush’s son George W. seized upon the trauma of 9/11 to increase the military budget to the point where we spend almost as much as the rest of the world combined on ever-more sophisticated— and therefore costlier—weapons to counter a terrorist enemy with a technologically primitive arsenal.

But the cost to civil liberties has been even greater. Beginning with the USA PATRIOT Act under George W. and continuing with the 2012 NDAA signed into law by Obama, we have surrendered our once-inviolate freedoms in the so-called war against terrorism.

Again quoting Ron Paul: “Little by little, in the name of fighting terrorism, our Bill of Rights is being repealed. The Fourth Amendment has been rendered toothless by the PATRIOT Act. No more can we truly feel secure in our persons, houses, papers and effects when now there is an exception that fits nearly any excuse for our government to search and seize our property.

… The recently passed National Defense Authorization Act continues that slip toward tyranny and in fact accelerates it significantly. … [It] does to the Fifth Amendment what the PATRIOT Act does to the Fourth. … The dangers in the NDAA are its alarmingly vague, undefined criteria for who can be indefinitely detained by the U.S. government without trial.”

Yet despite those warnings, President Obama—who, as a former Constitutional law professor, should be expected to know better—signed off on a massive defense authorization bill that threatens the fundamental rights of American citizens while continuing military spending at Cold War levels. Obama knew the bill was rotten on both counts. When the President betrayed his own earlier commitment to oppose this onerous provision in the military spending bill, White House Press Secretary Jay Carney conceded: “While we remain concerned about the uncertainty that this law will create for our counterterrorism professionals, the most recent changes give the President additional discretion in determining how the law will be implemented, consistent with our values and the rule of law, which are at the heart of our country’s strength.”

What bull. The point is not to hock our civil liberties to the discretion of the President, but rather to guarantee our freedoms even if a Dick Cheney or Newt Gingrich should attain the highest office. As Ron Paul warned: “The Bill of Rights has no exemptions for ‘really bad people’ or terrorists or even noncitizens. It is a key check on government power against any person. That is not a weakness in our legal system; it is the very strength of our legal system. The NDAA attempts to justify abridging the Bill of Rights on the theory that rights are suspended in a time of war and [that] the entire United States is a battlefield in the War on Terror. This is a very dangerous development indeed. Beware.”

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Don’t say you haven’t been warned. Before serving almost 30 years as a Los Angeles Times columnist and editor, Robert Scheer spent the late 1960s as Vietnam correspondent, managing editor and editor in chief of Ramparts magazine. Now editor of TruthDig.com, Scheer has written such hardhitting books as The Pornography of Power: How Defense Hawks Hijacked 9/11 and Weakened America and his latest, The Great American Stick-Up: Greedy Bankers and the Politicians Who Love Them.

WOULD JESUS VOTE FOR REPUBLICAN PRESIDENTIAL CANDIDATE NEWT GINGRICH?

by Robert Scheer for HUSTLER Magazine

If not for the well-established fact that most Republican primary voters are breathtakingly stupid, a columnist could safely assume that the Presidential campaign of Newt Gingrich would have collapsed by the time this is read. But never underestimate the ability of this particular blowhard to stick around. He has turned political hypocrisy into an art form and the debate over moral values into a carnival of competing sexual indulgences.

After all, Newt’s campaign only took off last fall because of the revelations of Herman Cain’s serial infidelities, exposing the then front- running family values candidate as a hypocrite who had allegedly sexually harassed several work colleagues. That sort of scandal is a difficult one for the Republican base to accept since its political theology proceeds from the notion that the second coming of Ronald Reagan was betrayed when the diabolical Bill Clinton was orally serviced by a lowly White House intern. There went the God-given City on the Hill to be replaced by gay marriages, the 9/11 attacks and the housing meltdown, all plagues cast upon us by that instrument of the devil, Representative Barney Frank (D-Massachusetts), a former chairman of the mighty House Financial Services Committee.

Not Bill Clinton, who—while devilish enough—had the saving grace of being a good ol’ white hetero Southern boy like George W. Bush and Newt on the Republican side. That expectation of white male depravity, as Confederate as pecan pie, is what allowed Gingrich to take Cain’s place as the front-runner in Republican primary polls last December because, in the deepest of Southern scripture, there is the assumption that when a “colored fellow” even looks at a woman, he’s already committed rape. But for a white dude, there is really no such thing as a sexual crime. Unless, of course, he marries a man.

Gingrich has kept his Christian values scorecard sufficiently high enough with most right-wing moral wing-nuts to be taken seriously as a Presidential contender. As to why some women have been willing to share their most intimate gifts with this despicable lout is for one of their gender to explain. But despicable Gingrich has been, with a trail of philandering so indelibly defined that it, on its own, obliterates any GOP claim to the moral high ground.

Don’t ever forget that in 1995 the Republican majority elected Newt Speaker of the House, third in line to succeed the President, when his sordid personal life was already known. That includes—in order to marry the woman with whom he was having an affair—discussing divorce terms with his cancer patient wife Jackie (Newt’s high school math teacher) while visiting her in the hospital a day after she had surgery. And Gingrich didn’t stop with betraying just one wife. No indeed, he was just getting started, hypocritically cheating on his second wife with an employee while he was leading the charge against Bill Clinton for doing the same thing. Although Newt was truer to Southern tradition, grabbing his satisfaction in the backseat of an American-made car.

Marianne Ginther, whom Gingrich had met at a 1980 Republican fund-raiser, said he asked her to marry him before his divorce from Jackie. He shed Marianne after learning his second wife had a disease that could lead to multiple sclerosis, she said, calling her on Mother’s Day 1999 to drop the Dbomb. In 2000, Gingrich wed Callista Bisek, a Congressional aide more than two decades younger than Newt, with whom he had a six year affair—while he was Speaker!

And Gingrich had the chutzpah to ask the Catholic Church to annul his 18-year marriage to Marianne because she reportedly had been previously married. Imagine the nonstop Fox News hysteria if the Democrats had elevated John Edwards to that level of national responsibility after the ugly truth was known of the Democrat’s comparable family betrayal.

While there are plenty of further salacious details that Gingrich will have to keep to himself during confessionals, I wonder if he converted to Catholicism in part because a church with so many sexual scandals of its own might be more forgiving of Newt’s sins. However, the Republican’s moral decadence in the economic arena should prove more problematic to a religion fond of invoking the example of Jesus.

Gingrich is all too typical of the corrupt moneychangers that Jesus threw out of the temple. As Newt was forced to acknowledge during the campaign, he received $1.6 million from Freddie Mac (the Federal Home Loan Mortgage Corporation), one of the leading financial entities that enabled the greatest swindle of the poor whom Jesus sought to protect. Nor could Newt get away with saying that Freddie Mac was just one of them damn “guvnment banks” and that he was merely a humble historian warning the banksters of their errant ways.

On the contrary, Gingrich served as a false prophet for Freddie Mac, claiming at the height of the housing bubble that this “government-sponsored” financial institution should be the model for the nation’s major enterprises, including NASA. In reality, Freddie Mac is a privately owned company that is traded on the stock market and pays its highest-ranking executives in the $10 million-a-year range.

The government-sponsored angle meant only that the taxpayers would end up paying for all of Freddie Mac’s bad debts while the housing swindlers, from their own lucratively rewarded top execs to their banking partners among the biggest Wall Street banks, made out like bandits. Just like Newt Gingrich.

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Before serving almost 30 years as a Los Angeles Times columnist and editor, Robert Scheer spent the late 1960s as Vietnam correspondent, managing editor and editor in chief of Ramparts magazine. Now editor of TruthDig.com, Scheer has written such hard hitting books as The Pornography of Power: How Defense Hawks Hijacked 9/11 and Weakened America and his latest, The Great American Stick-Up: Greedy Bankers and the Politicians Who Love Them.

DOWNSIZING THE MIDDLE CLASS IS A RISKY BUSINESS.

by Robert Scheer for HUSTLER Magazine

Poverty is not just for the poor anymore. Ever greater numbers among the 99% being screwed by the top 1%, who control more than 40% of the wealth in this country, should stop pretending to be middle-class and admit that they are on the deep, losing end of America’s fierce class struggle.

We used to think poverty was just for urban ghetto folk who looked, talked and acted differently than the rest of us. No more. Poverty has been democratized, and the poor are everywhere. “Funny, you don’t look poor” is what you might say to your neighbor in that white suburb who is surviving on food stamps and skipping mortgage payments until eviction. But when it comes to poverty, America is now an equal-opportunity society. Sure, folks don’t go around in rags and visibly malnourished.

Thanks to Walmart’s steady supply of Chinese sweatshop-produced clothes and our own government’s vastly expanded food stamp program, poverty is disguised.
In the past ten years, poverty in suburban America has jumped an astounding 53%, twice its rise in urban centers. For the first time in U.S. history, poverty in the suburbs exceeds that of the cities they surround. While the superrich scurry for safety in their fortress enclaves, suburbs across the country feature boarded-up houses with mortgages that are deeply underwater.

Six months before the appearance of an Occupy Wall Street encampment, Joseph E. Stieglitz wrote an article for Vanity Fair— titled “Of the 1%, by the 1%, for the 1%”— that provided the movement with its essential manifesto. In a prescient prediction of the protests to come, the Nobel Prize-winning economist issued a warning to the power elite that tends to read Vanity Fair : “Americans have been watching protests against repressive regimes that concentrate massive wealth in the hands of an elite few. Yet in our own democracy, 1% of the people take nearly a quarter of the nation’s income—an inequality even the wealthy will come to regret.”

What they will regret, if they retain a shred of caution born of common sense, is that despite an economic meltdown caused by bankers run wild and requiring massive taxpayer-financed government intervention to avoid another Great Depression, the financial overlords continued to pay themselves enormous bonuses while ordinary folk went bankrupt. Hiding behind the fig leaf of Adam Smith’s freemarket capitalism, they invented gimmicks never before known in the financial world that destroyed the real estate market and turned peoples homes into gambling chips in the Wall Street casino.
Thanks to the Republicans in Congress back in the 1990s and Democratic President Bill Clinton, who became their water boy, the rules of the regulatory road were changed. Swindles called collateralized debt obligations and credit default swaps—transactions that would have been judged patently illegal if the Mafia had invented them—were made legal as a matter of federal law. The result was a boom-and-bust cycle that vastly increased the gap between America’s superwealthy and the rest of the nation. In the process, the bedrock of the American Dream—an ever better-off middle class— was demolished.

Even during the Clinton years, which many Americans now think of as good times, the class divide in America was growing with a vengeance. As I document in my book The Great American Stickup, the income of the top 1% increased 10.1% per year under Clinton, while it rose only 2.4% for the other 99% of the population. Things got worse under George W. Bush. Even before the banking meltdown of 2007, the top 1% enjoyed an 11% annual rise in income, while the rest received the crumbs—sharing in a 1% increase. With the imminent collapse of their Ponzi scheme, the bankers were saved. In the meantime, their victims were thrown under the bus.

As libertarian Ron Paul, the Republicans’ only honest Presidential candidate, put it: “The bailouts came from both parties. Guess who they bailed out? The big corporations, the people who were ripping off the people in the derivatives market.… But who got stuck? The middle class got stuck…they lost their jobs, and they lost their houses. If you had money to give out, you should have given it to the people who were losing their homes, not to the banks.”

In his Vanity Fair article, Stieglitz hit the nail on the head: “The top 1% have the best houses, the best educations, the best doctors, and the best lifestyles, but there is one thing that money doesn’t seem to have bought: an understanding that their fate is bound up with how the other 99% live. Throughout history, this is something that the top 1% eventually do learn. Too late.”

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Before serving almost 30 years as a Los Angeles Times columnist and editor, Robert Scheer spent the late 1960s as Vietnam correspondent, managing editor and editor in chief of Ramparts magazine. Now editor of TruthDig.com, Scheer has written such hardhitting books as The Pornography of Power: How Defense Hawks Hijacked 9/11 and Weakened America and his latest, The Great American Stick-Up: Greedy Bankers and the Politicians Who Love Them.

DOWNSIZING THE MIDDLE CLASS IS A RISKY BUSINESS.

by Robert Scheer for HUSTLER Magazine

Poverty is not just for the poor anymore. Ever greater numbers among the 99% being screwed by the top 1%, who control more than 40% of the wealth in this country, should stop pretending to be middle-class and admit that they are on the deep, losing end of America’s fierce class struggle.

We used to think poverty was just for urban ghetto folk who looked, talked and acted differently than the rest of us. No more. Poverty has been democratized, and the poor are everywhere. “Funny, you don’t look poor” is what you might say to your neighbor in that white suburb who is surviving on food stamps and skipping mortgage payments until eviction. But when it comes to poverty, America is now an equal-opportunity society. Sure, folks don’t go around in rags and visibly malnourished.

Thanks to Walmart’s steady supply of Chinese sweatshop-produced clothes and our own government’s vastly expanded food stamp program, poverty is disguised.

In the past ten years, poverty in suburban America has jumped an astounding 53%, twice its rise in urban centers. For the first time in U.S. history, poverty in the suburbs exceeds that of the cities they surround. While the superrich scurry for safety in their fortress enclaves, suburbs across the country feature boarded-up houses with mortgages that are deeply underwater.

Six months before the appearance of an Occupy Wall Street encampment, Joseph E. Stieglitz wrote an article for Vanity Fair— titled “Of the 1%, by the 1%, for the 1%”— that provided the movement with its essential manifesto. In a prescient prediction of the protests to come, the Nobel Prize-winning economist issued a warning to the power elite that tends to read Vanity Fair : “Americans have been watching protests against repressive regimes that concentrate massive wealth in the hands of an elite few. Yet in our own democracy, 1% of the people take nearly a quarter of the nation’s income—an inequality even the wealthy will come to regret.”

What they will regret, if they retain a shred of caution born of common sense, is that despite an economic meltdown caused by bankers run wild and requiring massive taxpayer-financed government intervention to avoid another Great Depression, the financial overlords continued to pay themselves enormous bonuses while ordinary folk went bankrupt. Hiding behind the fig leaf of Adam Smith’s freemarket capitalism, they invented gimmicks never before known in the financial world that destroyed the real estate market and turned peoples homes into gambling chips in the Wall Street casino.

Thanks to the Republicans in Congress back in the 1990s and Democratic President Bill Clinton, who became their water boy, the rules of the regulatory road were changed. Swindles called collateralized debt obligations and credit default swaps—transactions that would have been judged patently illegal if the Mafia had invented them—were made legal as a matter of federal law. The result was a boom-and-bust cycle that vastly increased the gap between America’s superwealthy and the rest of the nation. In the process, the bedrock of the American Dream—an ever better-off middle class— was demolished.

Even during the Clinton years, which many Americans now think of as good times, the class divide in America was growing with a vengeance. As I document in my book The Great American Stickup, the income of the top 1% increased 10.1% per year under Clinton, while it rose only 2.4% for the other 99% of the population. Things got worse under George W. Bush. Even before the banking meltdown of 2007, the top 1% enjoyed an 11% annual rise in income, while the rest received the crumbs—sharing in a 1% increase. With the imminent collapse of their Ponzi scheme, the bankers were saved. In the meantime, their victims were thrown under the bus.

As libertarian Ron Paul, the Republicans’ only honest Presidential candidate, put it: “The bailouts came from both parties. Guess who they bailed out? The big corporations, the people who were ripping off the people in the derivatives market.… But who got stuck? The middle class got stuck…they lost their jobs, and they lost their houses. If you had money to give out, you should have given it to the people who were losing their homes, not to the banks.”

In his Vanity Fair article, Stieglitz hit the nail on the head: “The top 1% have the best houses, the best educations, the best doctors, and the best lifestyles, but there is one thing that money doesn’t seem to have bought: an understanding that their fate is bound up with how the other 99% live. Throughout history, this is something that the top 1% eventually do learn. Too late.”

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Before serving almost 30 years as a Los Angeles Times columnist and editor, Robert Scheer spent the late 1960s as Vietnam correspondent, managing editor and editor in chief of Ramparts magazine. Now editor of TruthDig.com, Scheer has written such hardhitting books as The Pornography of Power: How Defense Hawks Hijacked 9/11 and Weakened America and his latest, The Great American Stick-Up: Greedy Bankers and the Politicians Who Love Them.

AMERICA DESPERATELY NEEDS A NEW DEAL FROM THE WHITE HOUSE, BUT DON’T ROLL OUT THE RED CARPET FOR ANOTHER REPUBLICAN.

by Robert Scheer for HUSTLER Magazine

The “lost decade” is the way Harvard economics professor Lawrence Katz refers to the ten-year downslide of the U.S. economy since the election of Republican George W. Bush in November 2000. The road to ruin was paved by Bush, who impoverished the nation by waging two unnecessary trillion dollar wars while cutting taxes for the superrich. Yet, despite the fact that the Republicans created the mess, an all-too-easily-fooled public seems destined to put another one back in the White House.

The worst that can be said about President Barack Obama is that his response to the deep financial crisis he inherited from Bush was to continue the GOP strategy of throwing money at the banks instead of letting them go bankrupt. The banks were saved, but it was their victims—the suckers swindled into phony mortgages—who went bankrupt.

When Obama attempted to help ordinary folks with a relatively small stimulus check and save jobs in the automobile industry, before the last one of them went abroad, the Republicans and their allies among the Wall Street lobbyists branded him a socialist. Instead, we got socialism for the superrich when the Republicans seized control of the House of Representatives and prevented any further help for the foreclosed and unemployed.

The result of Republican power from the time of Bush has allowed 1% percent of the population to control 40% of this country’s wealth. In the past decade of greed run wild, the income of that 1% rose 18%, while that of the middle class declined. The total worth of the average American has been cut in half thanks to the banking/housing meltdown; an all-time-record 46.2 million people—including 22% of America’s children—are living below the government’s official poverty level ($22,350 for a family of four); and good jobs are going, going, gone.

“This is truly a lost decade,” Professor Katz told the New York Times. “We think of America as a place where every generation is doing better, but we’re looking at a period when the median family is in worse shape than it was in the late 1990s.”

Nor will it get better in the foreseeable future. The Federal Reserve estimates that the housing crisis that is at the root of the meltdown will go unabated for years to come. With 50 million Americans losing their homes, you can’t expect consumer confidence—now at record lows—to be restored; and since those consumers account for 70% of economic activity, forget the job situation improving anytime soon.

Yet dumb and dumber American voters look set to restore full power to the Republicans, who favor welfare for the superrich and Big Business. What voters can’t seem to grasp is that the days are over when the average Joe could legitimately hook his future to the prosperity of large corporations.

Those companies are called multinational for a reason: The bulk of their profits are sheltered abroad. Take GE, that old American-as-apple-pie company that had Ronald Reagan as a shill before Big Business needed him to run for President in 1980. Now two-thirds of GE’s workforce is abroad, along with 82% of the company’s profits. In addition, GE has paid no U.S. taxes for the past three years.

The multinational corporations are awash in cash, sitting on at least $2 trillion in funds they refuse to invest in creating jobs. Meanwhile, the big banks that were bailed out by the Federal Reserve—which took trillions of dollars of toxic mortgages off their books—refuse to make loans to deserving small businesses and creditable would-be home buyers.

The investments the multinational corporations do make are abroad, where they send the good-paying jobs that once were the basis of America’s economic leadership of the world. In September, Citigroup—the bankrupted banking giant bailed out by the American taxpayers—held its board of directors meeting, not in Chicago or Los Angeles, but in Singapore. Apparently, Citigroup chose that location because 30% of its profits are now derived from the Asian market, where the bank expanded using U.S. taxpayer dollars.

As the Wall Street Journal reported, “Citi’s business in Asia will likely help it as the West slows down.” But the West that they are ignoring, in case you didn’t happen to notice, is where the U.S. taxpayers who bailed out the bank happen to live and try to find work. Citigroup and other financial institutions were made whole by Republican-inspired bailouts, but fully 25 million Americans who are looking can’t find full-time work.

The only Republican candidate who can make any kind of claim to a record of job creation is Texas Governor Rick Perry. But when you realize that Texas leads the nation in the number of workers earning the minimum wage or less, you learn all you need to know about the GOP’s view of job creation. Republican politicians always make it a point to pin a little American flag on their jacket lapel, but they are false patriots conspiring to ship the American Dream abroad.

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Before serving almost 30 years as a Los Angeles Times columnist and editor, Robert Scheer spent the late 1960s as Vietnam correspondent, managing editor and editor in chief of Ramparts magazine. Now editor of TruthDig.com, Scheer has written such hard-hitting books as The Pornography of Power: How Defense Hawks Hijacked 9/11 and Weakened America and his latest, The Great American Stick-Up: Greedy Bankers and the Politicians Who Love Them.

THE BANKERS AND OTHER WHEELER-DEALERS WHO IMPOVERISHED THE NATION CONTINUE TO ENRICH THEMSELVES.

By Robert Scheer
From HUSTLER MAGAZINE September 2011

Republicans are the party of the super rich, pure and simple, and all that Tea Party garbage about small government is nothing but a big-lie propaganda ploy by an extremely radicalized fringe of the GOP that betrays its moderate heritage.

This is coming from a journalist who still thinks Dwight D. Eisenhower was the best modern day American President after Franklin Delano Roosevelt and who got along just fine with Ronald Reagan and Richard Nixon when he profiled them. Nixon even wrote me a letter expressing thanks for my “objective” reporting on his domestic policy, which included a call for a guaranteed minimum income for all Americans and the creation of the Environmental Protection Agency.

Try finding a single Republican politician today who is proud to support either of those sensible Nixon proposals. Even the two Bushes look pretty reasonable compared to the current crowd that wants to wipe out Medicare and Social Security to save our tax dollars for even more exorbitant gifts to the bankers and other corporate hotshots who impoverished the nation while enriching themselves.

At a time when 10 million Americans will have lost their homes by year’s end, when $5.6 trillion in home equity has been wiped out, when most workers face steep unemployment rates and stagnant wages, Republican ideologues insist that extending the Bush-era tax cuts is the best way to create jobs. The Republicans are drunk on the notions of voodoo economics whereby giving more money to those who already have obscene amounts is good for the rest of us.

Even former Fed Chairman Alan Greenspan, who supported the Bush tax cuts, has come to his senses by arguing against their extension in the midst of the global economic crisis: During an appearance on NBC’s Meet the Press he stated, “This crisis is so imminent and so difficult that I think we have to allow the so-called Bush tax cuts all to expire. ”With regard to how much the U.S. government could save from letting income taxes go back up to levels last seen under President Bill Clinton—an estimated $3.6 trillion—Greenspan said, “That is a very big number.”

He specifically shot down the absurd notion that those tax cuts will reduce the deficit by freeing up more money in the hands of the rich for investment. When host David Gregory asked his guest if he believed that the tax cuts pay for themselves, as Republicans argue, Greenspan replied unequivocally, “They do not.”

The GOP argument that the tax cuts will generate new economic activity because wealthy people will invest more flies in the face of a reality in which the rich are awash with cash but do not spend it in ways that create jobs in this country, as opposed to U.S. corporate investment abroad.

As the New York Times reported, “In the fourth quarter, profits at American businesses were up an astounding 29.2%, the fastest growth in more than 60 years. Collectively, American corporations logged profits at an annual rate of $1.678 trillion.”

And to add insult to injury, the top executives—who seem unable or unwilling to create increased their own compensation by a whopping 12% over the previous year, leaving the median pay at $9.6 million for those in control of the 200 leading companies. The Times report added that “CEO pay is also on the rise again at companies like Capital One and Goldman Sachs, which survived the economic storm with the help of all of those taxpayer-financed bailouts.”

What the Republicans want you to forget is that the recession brought about by their wild deregulatory policies, allowing Wall Street greed to run wild, was launched by their much-hyped “Reagan Revolution, ”which is the basis of our debt crisis. The debt now looms so large because the government had to bail out many of those same corporations, quite a few of which—most notably General Electric and AIG—pay no taxes and have no problem paying truly obscene amounts to their top executives.

General Electric CEO Jeffrey Immelt is making as much as he did before the recession hit, a recession that his GE Capital division did much to cause with its reckless loans. AIG, saved with a government infusion of $170 billion, has lavishly rewarded its top executives but has provided no relief for the homeowners ripped off by its phony credit default swaps.

The result of the Reagan Revolution is that the top 1% of Americans own 40% of the total national wealth, mocking the idea that we are a middle-class-based democracy. That is because the after-tax income of that top 1% has more than doubled in the 30 years since Reagan assumed the Presidency. That’s after-tax income, so don’t tell me they are hurting from too high taxation.

The reality is quite the opposite: The rich are getting richer while the purchasing power of wages and other income for most Americans has been declining. How obscene then that the Republicans want to gut programs like Medicare, Social Security and workers pensions, which are the main barrier keeping most Americans from a life of retirement in poverty.
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Before serving 30 years as a columnist for the Los Angeles Times, Robert Scheer spent the late 1960s as Vietnam correspondent, managing editor and editor in chief of Ramparts magazine. Now editor of TruthDig.com, Scheer has written such hard-hitting books as The Pornography of Power: How Defense Hawks Hijacked 9/11 and Weakened America and his latest, The Great American Stick-Up: Greedy Bankers and the Politicians Who Love Them.

OBAMA PROPOSES KILLING FEDERAL AGENCIES THAT PROVIDE LOW-INTEREST MORTGAGES IN FAVOR OF PRIVATE BANKS.

by Robert Scheer
from HUSTLER Magazine July 2011

The idea that your home is your castle has deep roots in the history of human liberation, and owning your own home, providing an inviolable sanctuary for the family, is a cherished aspect of the American Dream. Your turf, protected by the Constitution from official intrusion, has been key to the notion of a democracy of middleclass stakeholders supported by various government programs going back to the Founders. Not being beholden to the whims of an oppressive landlord, possessing a property deed and buying out the mortgage is a critical enterprise in preserving freedom. That enterprise is now under frontal assault from the Obama Administration.

According to a 31-page policy statement issued in February 2011, the administration is abandoning the government’s time-honored role in helping Americans achieve home ownership by underwriting low-interest mortgages through the government-sponsored agencies Freddie Mac and Fannie Mae. Now President Barack Obama proposes to turn over the entire mortgage industry to the same private banks that sabotaged the American ideal of a nation of stakeholders by “securitizing” our homesteads into poker chips to be gambled away in the Wall Street casino. Instead of punishing those banks, which forced 50 million people into foreclosure or deeply under water on their mortgages, he wants to reward them.

The proposal was originated by Treasury Secretary Timothy Geithner and involves nothing less than a total “winding down” of the nearly 80-year-old federal housing program, setting instead a new goal of a twotiered America in which the masses are content to be mere renters of the American Dream. Such a deal for a country where, as the report concedes, “half of all renters spend more than a third of their income on housing, and a quarter spend more than half.”

This is the same Geithner who during his tenure in the Clinton Treasury Department championed the total deregulation of the then-emerging market in collateralized debt obligations. As a result, people’s home mortgages were sliced and diced into the toxic securities that created what Geithner’s new report calls the greatest economic crisis since the Great Depression. Later, as president of the New York Fed, Geithner cheered on the banks as they went hog-wild, conning folks into buying homes they couldn’t afford and stuffing them into the incomprehensible securities that form the rot at the core of our bankrupt economy.

This is a made-in-the-U.S. nightmare that we inflicted on the world, thanks to an explosion in those toxic securities brought on by the deregulation that most of the Obama economic brain trust supported when they worked for President Bill Clinton and during the ensuing bubble years when they enriched themselves. As the report admits: “The U.S. is…the only high-income country in which securitization plays a major role in housing finance.”

Yet instead of ending that practice, Obama now calls for more of the same: “The administration believes the securitization market should continue to play a key role in housing finance.” Indeed, the plan’s goal of eliminating Fannie Mae and Freddie Mac will dry up the alternative public funding that has provided a source of mortgage support ever since President Franklin Delano Roosevelt launched Fannie Mae to check the power of the banks over mortgages. Now Obama proposes to eliminate that check, leaving would-be homeowners to the tender mercy of the banking giants.

Of course Fannie Mae and Freddie Mac, which had morphed into for-profit enterprises, also bear responsibility for the meltdown. Just as with the Wall Street firms, the massive bonuses paid out to these housing agencies’ top executives were contingent on the value of their stock prices, which in turn were fattened by the sale of those same toxic assets. As the Obama report puts it, “Fannie Mae and Freddie Mac’s profit-maximizing structure undermined their public mission.” What the administration should have proposed is to return the government-sponsored housing agencies to their original function as nonprofit entities supplementing, rather than aping, the practices of greedy bankers.

What Obama neglected to discuss is the demise of President Franklin D. Roosevelt’s grand experiment at the hands of Democratic Party hustlers who turned the agencies away from their “original mission” and into their personal piggy banks while getting Democrats in Congress to approve regulations enabling their greed.

The folks around President Obama know this sad tale well because some of them were principal actors in the housing agencies’ betrayal of the public trust. Just take the case of Tom Donilon, whom Obama recently appointed to the highly sensitive position of National Security Advisor. It was Donilon who was the top legal counsel and lobbyist for Fannie Mae from 1999 to 2005, a period when the agency went off the tracks in backing Countrywide and other private-sector bandits in their irresponsible ripoff scams.

Donilon, who reportedly received $10 million in the three years leading up to the scandal of 2004—when Fannie Mae was fined $400 million for juggling its books to enhance executive bonuses—will never have any trouble financing a home purchase. Not so the tens of millions of Americans who have lost their homes because of Donilon’s reprehensible actions and the many more in the future who will be denied government support in trying to get a place of their own.

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Before serving 30 years as a columnist for the Los Angeles Times, Robert Scheer spent the late 1960s as Vietnam correspondent, managing editor and editor in chief of Ramparts magazine. Now editor of TruthDig.com, Scheer has written such hard-hitting books as The Pornography of Power: How Defense Hawks Hijacked 9/11 and Weakened America and his latest, The Great American Stick-Up: Greedy Bankers and the Politicians Who Love Them.

ADDRESSING AMERICA’S ECONOMIC WOES, PRESIDENT OBAMA ADMONISHES UNDERACHIEVING STUDENTS, YET CONTINUES TO IGNORE THE REAL CULPRIT.

by Robert Scheer
from HUSTLER Magazine June 2011

There is something perverse about how Presidents, every time they get in trouble over the state of the nation, seize upon education- related scapegoats for all that ails us.

John F. Kennedy did it with his Sputnik speech prompted by the Soviets, who’d managed to launch the first artificial satellite and later put the first man into space—propaganda coups that did nothing to mitigate the USSR’s miserably sagging economy.

George W. Bush devised the “No Child Left Behind” slogan to justify his multitude of screwups, most notably coddling Wall Street while it defrauded American mortgage buyers and incurred the trillions in bad loans that had to be picked up by the taxpayers. Now Barack Obama has seized upon students’ lackluster test scores to explain the miserable state of the U.S. economy, playing the Sputnik card by way of justifying saving Wall Street while ignoring the rest of us.

In his 2011 State of the Union address, Obama—who moved sharply to the right after the Democrats’ setback in the midterm elections— fully embraced the Wall Street bandits, whose unfettered greed sucked us into this mess. Nevertheless, Obama blamed American students’ subpar test scores for our economic woes. What the hell did Sputnik or low aptitude have to do with the Made-in-America financial meltdown that Wall Street bankers inflicted on the entire world?

It is they, the best and the brightest graduates of our business and law schools—not kids struggling at public high schools and community colleges—who designed the toxic derivatives that almost destroyed the world economy. Obama’s focus on education in his State of the Union speech is a deliberate diversion from what seriously ails and afflicts us: an unabated mortgage crisis, stubbornly high unemployment and a debt that spiraled out of control while the government wasted trillions of tax dollars making the bankers whole.

What nonsense to insist that low test scores of students at public schools hobbled our economy when it was the highest-achieving graduates of our elite colleges who designed and sold the financial gimmicks that created the Great Recession. Indeed, some of the folks who once designed the phony mathematical formulas underwriting subprime mortgage-based derivatives won Nobel Prizes for their effort. A pioneer in securitizing mortgage debt, as well as in exporting jobs abroad, was one Jeffrey Immelt, the CEO of General Electric, whom Obama appointed to head his new job-creation panel.

That the financial meltdown at the heart of our economic crisis was “avoidable” and not the result of long-run economic problems related to education and foreign competition is detailed in a sweeping report by the Democratic majority on the Financial Crisis Inquiry Commission. In a 576-page book the commission concluded: “The greatest tragedy would be to accept the refrain that no one could have seen this coming and thus nothing could have been done. If we accept this notion, it will happen again.”

That is just the warning that Obama has ignored by continually appointing the very people who engineered this crisis, mostly Clinton alums, to reverse its ongoing dire consequences. The commission noted that the decision made in 2000 in the closing days of the Clinton Administration to exempt the complex financial instruments known as over-thecounter derivatives from regulation was “a key turning point in the march toward the financial crisis.”

Obama appointed as his top economic adviser Lawrence Summers—who, as Clinton’s Treasury secretary, was the key architect of that “turning point”—and Summers’s protégé Timothy Geithner as his own Treasury secretary. The finding of the ten members—six Democrats and four Republicans—on the Financial Crisis Inquiry Commission was that Geithner, who had been president of the New York Fed before Obama appointed him, “could have clamped down” on excesses by Citigroup, the subprime mortgage leader that Geithner and the Fed bailed out along with other unworthy banking supplicants.

That profligate behavior of Wall Street crippled the economy and ran up an enormous debt, which Obama now uses as an excuse for a five-year freeze on discretionary domestic spending, the small part of the budget that might actually help ordinary people. Speaking of our legacy of deficit spending, Obama stated, “…in the wake of the financial crisis, some of that was necessary to keep credit flowing, save jobs and put money in people’s pockets. But now that the worst of the recession is over, we have to confront the fact that our government spends more than it takes in.”

Why now? It is an absurd demarcation to freeze spending when so many remain unemployed just because corporate profits, and therefore stock market valuations, seem firm. Wall Street profits are booming, but the price has been—as the Financial Crisis Inquiry Commission reported—26 million Americans out of work, more than 8 million families that have lost their homes and “nearly $11 trillion in household wealth [that] has vanished, with retirement accounts and life savings swept away.” America is a union divided between those who agree with Obama that “the worst of the recession is over” and the far larger number in deep pain that this President, like his Republican predecessor, is bent on ignoring.

Before serving 30 years as a columnist for the Los Angeles Times, Robert Scheer spent the late 1960s as Vietnam correspondent, managing editor and editor in chief of Ramparts magazine. Now editor of TruthDig.com, Scheer has written such hard-hitting books as The Pornography of Power: How Defense Hawks Hijacked 9/11 and Weakened America and his latest, The Great American Stick-Up: Greedy Bankers and the Politicians Who Love Them.

by Robert Scheer
from HUSTLER Magazine January 2011

ROBERT RUBIN GIVEN PASS FOR KEY ROLE IN DESTROYING ECONOMY

One of the hallmarks of American power elites—in contrast to those of, say, Japan—is that they never seem to be held accountable for their crimes and incompetence. Instead of committing hara-kiri, they just lay low for a few months and then pretend they had nothing to do with any of it.

So it is that CNN pundit Fareed Zakaria, who suffered no apparent shame or career consequences for initially backing the biggest U.S. foreign-policy blunder since Vietnam—the invasion of Iraq, can be paid to blithely toss softball questions on national television to Robert Rubin, key backer of the most destructive domestic policies in the same time period: the deregulation of the banking industry.

Ah, television “journalism.”

On this particular Sunday, I was trapped on a treadmill in front of an overhead television and unable to turn the thing off in time to avoid this assault on my mental and physical health. As a result I was forced to hear Rubin, Treasury secretary under President Clinton, insist he always favored regulating toxic derivatives and is therefore not at all responsible for the ensuing economic meltdown.

Rubin was responding to the sole critical question from the CNN host, who quoted a question by New York Times columnist Paul Krugman: “Did all the senior members of the [Obama] economics team have to be protégés of Robert Rubin, the apostle of financial deregulation?”

Unfortunately, Zakaria just rolled over when his guest simply lied in response: “First of all,” Rubin said, “I am not the apostle of financial deregulation. Quite the contrary. On derivatives…I developed a deep concern about the systemic problem that was created. When I was back at Goldman Sachs, it was a concern I had…a concern I had when I was in government. And, in fact, when I wrote my book in 2003, I was so concerned about it that I actually included that discussion in there.”

Zakaria ended the show recommending it as his book of the week: “He [Rubin] wrote a great memoir that covered his two distinguished careers, both…on Wall Street and in Washington. … It was written with Jacob Weisberg, a great writer, the [former] editor of Slate, and the two men weave a compelling tale that has many lessons for today.”

To be charitable, I will assume that Zakaria has not actually read that book, which omits any discussion of the radical deregulation legislation that Rubin ushered through Congress and got the President to sign. Clinton is on record stating he got bad advice from Rubin and his handpicked successor, Lawrence Summers, on derivatives regulation: “On derivatives, yeah, I think they were wrong, and I think I was wrong to take [their advice],” Clinton told ABC News in April 2010.

Rubin and Summers were responsible for forcing Brooksley Born out of the Clinton Administration because, as chair of the Commodity Futures Trading Commission, she had the temerity to suggest regulating the mortgage- backed securities that eventually proved to be so toxic. Instead, Rubin and Summers pushed the Commodity Futures Modernization Act, which Clinton signed into law before his last month in office, categorically exempting those suspect derivatives from any government regulation.

By then, Rubin had moved on to a $15- million-a-year job at Citigroup, which became a prime exploiter of the subprime housing market. As a result of its massive involvement with toxic securities, Citigroup— with Rubin in a leading role until early 2009—had to be bailed out by the federal government with a $45-billion direct investment and a guaranteed Fed protection for $306 billion in potentially toxic assets.

Citigroup, a merger of the old Citicorp and Travelers Group, was made legal only by the Financial Services Modernization Act, which Rubin backed while serving as Treasury secretary.

Then, in one of the most egregious conflicts of interest in U.S. history, Rubin went to work for the new bank, which took advantage of the changes in the law to buy up the infamous subprime lenders, beginning with Associates First Capital. The Economist magazine questioned whether investors would see Citi’s bold new venture “as something smart, such as ‘evolved credit extension,’ or something seamy, such as loan-sharking.”

Rubin was a major proponent of the firm’s seamy expansion into the mortgages that proved to be toxic, and by 2007 Citigroup was the second-largest subprime servicer, after the only slightly more infamous Countrywide.

There is much more, and I haven’t even touched on Rubin’s shameful role in Enron’s shenanigans. Enough said, though, to question not only Fareed Zakaria’s journalism but, far more important, Barack Obama’s leadership in first turning to Rubin as a key campaign adviser and then putting his disciples in charge of the U.S. economy.

Before serving 30 years as a columnist for the Los Angeles Times, Robert Scheer spent the late 1960s as Vietnam correspondent, managing editor and editor in chief of Ramparts magazine. Now editor of TruthDig.com, Scheer has written such hard-hitting books as The Pornography of Power: How Defense Hawks Hijacked 9/11 and Weakened America and his latest, The Great American Stick-Up: Greedy Bankers and the Politicians Who Love Them.

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