American Conspiracies - Jesse Ventura [104]
I can’t help but believe there was method to this madness, that it was all designed. I learned in Minnesota that it should not be government’s place to pick winners and losers, but to make policy that all have to follow. The disturbing thing is how this was utterly manipulated by the government. Paulson also gave billions to Bank of America so it could pay an inflated price to rescue Merrill Lynch, whose CEO John Thain had once headed Goldman’s mortgage desk and then was CEO of the New York Stock Exchange. While Merrill Lynch was going belly-up, Thain was busy buying an $87,000 area rug for his office and a $35,000 toilet bowl. Some might call him a four-flusher, since he’d lost about $15 billion in just three months at Merrill Lynch, and Bank of America then decided to fire Thain when he demanded a $30 million bonus.32 Oh, by the way, Thain was a mentor of Timothy Geithner, who’s now treasury secretary under Obama.
Then came the bailout of AIG. We were told that, if AIG collapsed, every large American financial institution and a lot of foreign ones would have gone under with them. Guess who sat in on the closed-door meeting where Paulson and Geithner—who then headed the New York Fed—made the decision to rescue them? Goldman’s CEO, Lloyd Blankfein, who’d have been in major trouble if they didn’t. That week, Paulson’s calendars show he spoke to Blankfein two dozen times, far more than to any other Wall Street exec.33 Birds of a feather and all that. “The government then wrote Goldman a $12.9 billion check to cover its losses to AIG, which were predicated on contractual arrangements that would have been worthless had AIG gone bankrupt.”34 Other AIG trading partners who bought subprime insurance got “saved,” too, like Bank of America, JP Morgan Chase, and Citigroup. Hallelujah! The way Eliot Spitzer sees it, “The appearance that this was all an inside job is overwhelming. AIG was nothing more than a conduit for huge capital flows to the same old suspects, with no reason or explanation.”35
What did AIG do with $181 billion altogether in taxpayer-funded bailouts? Do Americans realize that our money went to pay off foreign debt owed by private enterprise in the U.S.? When rescued, AIG had at least $40 billion in credit default swaps outstanding.36 $11.9 billion went to pay its debt to France’s Societe Generale, and $11.8 billion more went to Deutsche Bank of Germany, and $8.5 billion to Barclays Bank in Britain.37 During the last three months of 2008, AIG was losing more than $27 million an hour or $465,000 every minute. With numbers like that, Bernie Madoff comes off as chump change.38 But they were still giving bonuses totaling around $450 million to everybody in the Financial Products Unit—the very same people who’d bankrupted the company!39 Until Congress did an intervention, Joe Cassano continued to pull down a million-dollar-a-month salary.40
This whole bailout business stinks. And we’ve been left holding the bag. That original $700 billion bailout figure has mushroomed into a commitment that includes about $1.1 trillion in taxpayer money. Total financial support from the Fed, Treasury, and FDIC is actually around $3 trillion, with potential support authorized of $23.7 trillion!41 One economist says government officials “see all this as a Three Card Monte, moving everything around really quickly so the public won’t understand that this really is an elaborate way to subsidize