American Conspiracies - Jesse Ventura [105]
Wasn’t the expectation that, once it got rescued, Wall Street would then be good sports and send money into creating jobs and initiating a major recovery? But the big banks didn’t start lending again, instead they hoarded the cash and paid out huge bonuses to their execs. The behemoths got even more beastly. Today JPMorgan Chase holds more than one out of every ten dollars on deposit in America. Bank of America and Wells Fargo are close behind. Those three, plus Citigroup, now issue one half of all mortgages and about two thirds of our credit cards. The big guys can borrow more cheaply because creditors assume they’re at no risk for failing.43 “Incredibly, despite the events of last fall, nearly every one of Wall Street’s proprietary trading desks can still take huge risks and then, if they get into trouble, head to the Federal Reserve for short-term rescue financing.”44
Presiding over the money pit is “Gentle Ben” Bernanke, whom Obama reappointed to head the Federal Reserve. Even though they were a major contributor to the disaster that millions have suffered, we’re now supposed to cheer their heroic attempt to clean up their own mess. Regional and smaller banks are still crumbling, while the Street gangs are on government life-support. Do you ever wonder where the Fed gets the money? Well, basically they print it out of thin air. Check out Article 1, Section 8 of the Constitution: Only Congress is granted the power “to coin money” and “regulate the value thereof.” No separate agency or concession like the Federal Reserve is given the power. But today, they aren’t even required to send a budget to Congress. The Federal Reserve can enter into agreements with foreign banks and governments that we can’t find out about. The dozen regional Federal Reserves around the country have bankers on their boards who tell them what they should be thinking about. And the Fed basically owns the economics profession. Their Board of Governors has 220 PhD economists on its payroll, not to mention scores more with the regional banks, plus all the research and support staff.45
Ron Paul, a congressman I admire, has introduced the Federal Reserve Transparency Act, calling for “more effective oversight and auditing of the Fed.” Paul points out that, since the Fed was created almost a hundred years ago, the dollar has lost more than 95 percent of its purchasing power. “Only big-spending politicians and politically favored bankers benefit from inflation,” Paul says.46 Bernanke has said that an audit would mean “a takeover of monetary policy by the Congress,” perish the thought. The reality is that the road we’re currently on “leads to the corporate state—a fusion of private and public power, a privileged club that dominates everything else from the top down.”47 Mussolini once had a term for that: he called it fascism.
Almost 700 execs who participated in running our economy into the ground have received more than a million bucks apiece in bonuses.48 Goldman Sachs had a spectacularly profitable first half of 2009—due to less competition (go figure why), and a revenue surge from trading foreign currency and bonds. Goldman’s 30,000 employees will each earn an average of $700,000 this year.49 Good old Warren Buffett, who thought smart and bought $5 billion in Goldman shares in January, had already scored a billion on that investment.50 Edward Liddy, the dollar-a-year guy who was installed by our government as AIG’s new CEO, happens to still own a significant stake in Goldman, so I guess he’s doing all right.51
The banking lobby in Congress “frankly own the place,” Illinois senator Dick Durbin has said.52 Over the last decade, the financial sector spent over $5 billion on lobbying and federal campaign contributions.53 Nearly half the members of the Senate Banking Committee (which happens to oversee the bailout bucks) had holdings in the same financial institutions that gained funds from the Troubled Asset Relief Program (TARP).54 “If TARP had been a credit card, it