Saturday, October 30, 2010


Ted Downing, Research Professor of Social Development at Arizona Research Laboratories, the University of Arizona, is a powerful intellect far from the aloof "ivory tower" stereotype. During his two terms in the Arizona State House he was a not only a tough defender of his Democratic constituents but also a conciliator with his colleagues on the other side of the aisle when it came to issues affecting all of us. 

Indeed there are issues affecting us all that both the Republican and Democratic State Committees ignore, because in effect they have become cliques with their own agendas and their ears closed to the citizens' needs and desires. This is why Ted decided to run for State Senator (District 28 in Tucson) on Tuesday as an Independent.

As an independent Ted will not be required to answer to either of the major State Party hierarchies and will collaborate with likeminded Senators on both sides of the isle.

I'm not just making this up. Ted Downing has done this before.

Back in 2004 when the first whiff of election rigging caught the attention of rank-and-file Democrats and Republicans, their State Party officials and entrenched elected officials refused to hear citizen complaints. And when citizen investigators actually produced evidence of insider election manipulations and carried forward court cases, they were stone walled by elected officials of both party affiliations at the state and local levels.

The few grassroots Democrats and Republicans who were paying enough attention percived that "Something is rotten in the state of Denmark." And naturally they immediately suspected each other.

But then miracles began to happen, and Ted Downing was huge part of them.

There was a gradual realization by many citizens that, in the words of Tucson election sleuth extraordinaire John Brakey, election fraud "isn't about right and left, it's about right and WRONG!"

Following a fiasco in the 2004 Republican primary, Republican Senator Jack Harper authored an election reform bill that was immediately opposed by knee-jerk Democratic opponents -- the very event that brought out John Brakey's famous remark.

In the end Harper's bill didn't pass.

But later on, then-State-Representative Ted Downing formed an alliance with his friend, Senator Karen Johnson, a Republican State lawmaker who had become deeply concerned about the state of election integrity in Arizona.  Together Ted and Karen assembled what may be the best election-integrity bill in the country and successfully marketed it on both sides of the aisle.  

This bill, SB 1557, was passed by both houses of the AZ State Legislature with only 5 opposing votes out of 90!

An incredible but true story of bi-partisan cooperation when our democracy was on the line!

Elect Ted Downing on Tuesday and expect more pan-partisan laws to pass that match the wishes of you the voter, rather than those of the big corporate interests that have the complete attention of most members of the major-party power structures.

David L. Griscom, Ph.D.

Thursday, October 28, 2010

Banks responsible for the mortgage crisis sold the same mortgages to multiple buyers at the same time.

Monday, October 18, 2010
Mortgages Were Fraudulently Pledged to Multiple Buyers at the Same Time

Bank of America alleged in a court filing this June:
It appears as though many loans and other mortgage-related assets have been double and even triple-pledged to various constituencies.
Boa Answer to Freddie Objection in Re Taylor Bean & Whitaker Mortgage Corp.

April Charney - a consumer lawyer with Jacksonville Area Legal Aid - and CNBC's Dennis Kneale noted in February 2009 that courts have found that some mortgages have been sold again and again to different trusts, when they should have only been sold once.

Kneale explained that that is the reason that two different banks sometimes try to simultaneously foreclose on the same home:
Bloggers Note: In the video below, Dan Mitchell from the Cato Institute disburses disinformation. He begins by deflecting the discussion of bank culapility by accusing "groups like ACORN" (a poor people's advocacy group now defunct due to false accusations made against them on Fox News) of "practicing extortion." In response to reports that banks pledge mortgages multiple times to different buyers, he says "Banks make technical mistakes" (like they never commit fraud). But "If home owners get away with not paying their mortgages that would be a very bad message to send." (Classic blame the victim.)

And today, Chris Whalen told CNBC's Larry Kudlow that Bear Stearns will be exposed as having sold the same loan to different investors on numerous occasions:

(6:45 into video).

As I have repeatedly pointed out, the failure of the mortgage originators and banks to prepare and record proper documentation has led to an epidemic of fraud. The pledging of the same mortgage again and again to different trusts related to mortgage backed securities is just one result.

And as long-time foreclosure investigator Nye Lavalle writes:
On thousands of occasions I stated to regulators, CEOS, banks, Fannie and Freddie that the practices of the banks were that they were double and multi-pledging assets and pledging paid off and refinance notes to securitizations. This is something April, Max and I have discussed for years now. Now, they come and admit that each of my allegations were true Without analyzing the deal, as complex as they are, you WILL NEVER KNOW IF THE FORECLOSING PARTY HAS “ANY” RIGHT TO FORECLOSE!!!

The motives I identified for the “Blank Endorsements” and missing assignments and "pre-notarized" “Blank Assignments” and “Blank Allonges” that “were placed into the “custodial/collateral” files were to be able to:

Multi-pledge collateral (Notes) so as to cook the books ....
Update: Bank of America has sued the FDIC in connection with claims that:
Executives at Taylor Bean, Colonial and Platinum ... fraudulently schemed to "double- and triple-pledge mortgages and steal assets" to hide their faltering conditions as the housing market declined.

Tuesday, October 26, 2010


Blogger's Note: I found this first video on the "The Daily Bail," a web site with a library of 10,000+ videos exposing the criminal operations of the U.S. government. Both of the videos below have been viewed more that 2 million times. The first one is proclaimed by The Daily Bail editors as the "Most Important Video We've EVER Posted."

Representative Alan Grayson: Is Anyone Minding the Store at the Federal Reserve?
May 12, 2009

The video above is a high quality version of the Financial Services Subcommittee on Oversight and Investigations hearing of May 5, 2009.

Rep. Alan Grayson asks the Federal Reserve Inspector General about the trillions of dollars lent or spent by the Federal Reserve and where it went, and the trillions of off balance sheet obligations. Inspector General Elizabeth Coleman responds that the IG does not know and is not tracking where this money is.

Federal Reserve Office of the Inspector General:

We Now Have A Total Gangster Government
June 14, 2009

Rep. Michele Bachmann (R-Minn.) speaking on the House floor: Now weve moved into the realm of gangster government. We have gangster government when the Federal Government has set up a new cartel and private businesses now have to go begging with their hand out to their local hopefully well politically connected Congressman or their Senator so they can buy a peace offering for that local business. Is that the kind of country we are going to have in the future?

Please join our efforts to rid our government of these scum bags. Join The Kick Them All Out Project at

Monday, October 25, 2010

Saman Mohammadi: "What transpires on American streets in the next couple of years will define the rest of this century, and dare I say, human destiny."

October 22, 2010 at 21:16:10

Ready Or Not, Here Come The Kleptocratic Bloodsuckers

Op Ed News Diary Entry by Saman Mohammadi

The democratic and security threat to America is not from right-wing militias, or Islamic radicalism, or socialism, but from kleptocrats who hijacked the federal government and looted the country through the misappropriation of public funds in the trillion dollar war on terror, the decades-long war on drugs, the trillion dollar war in Iraq, the multi-billion dollar construction of the domestic surveillance-police state, the nine hundred billion dollar health care bill that primarily benefited insurance companies and drug corporations, and the radically unpopular bailout programs that were passed in Congress at the threat of martial law following the financial crisis in the fall of 2008 that economic experts like James K. Galbraith say was driven by fraud at the highest levels in financial institutions on Wall Street.

The illegal relationship between public officials on both aisles and a few selected corporations and banks is not new in America, but never before have the interests of the two groups been so interconnected, and obvious to the public. This corrupt establishment's criminal hold on power is vulnerable to the point that it can be challenged by even the smallest form of democratic pressure by outraged citizens if they ever decide to outgrow their petty allegiances to their favorite political party, and hit the streets with the kind of righteous rage that is required for the occasion.

Indeed, if the collective awakening of the American people leads to collective action then America's free republic may well be saved from total economic and social destruction, and the dictatorial overhaul of the Western World by globalist conspirators may yet be prevented.

What transpires on American streets in the next couple of years will define the rest of this century, and dare I say, human destiny. The traitorous kleptocrats in Washington D.C. know this very well, and have prepared accordingly. They are ready for the coming popular revolution, and they view any democratic challenge to the rule by Wall Street and America's transnational corporations as a threat to the country itself. As Washington's Blog pointed out last month, "the interests of the government and big business are so closely aligned that some high-level government officials may consider any threat to the bottom line of the big banks and other corporate giants as an existential threat to the nation's security."

America's descent into third-world rule happened because both major political parties, in their selfish and short-minded quest for electoral supremacy, opened the revolving gates on Capitol Hill to Wall Street's Gollums to the detriment of the best interests of the country's 300 million citizens.

In the dictionary kleptocracy is defined as "government by those who seek chiefly status and personal gain at the expense of the governed." It is easy to recognize that America's current political class fits this description.

Despite being run by kleptocrats, the United States government frequently highlights and condemns foreign kleptocracies. In August 2006, the Bush administration issued a report called "National Strategy Against High-Level Corruption: Coordinating International Efforts to Combat Kleptocracy" saying that; "High-level, large-scale corruption by public officials, or kleptocracy, threatens America's global interests. These interests include ensuring security and stability; the rule of law and core democratic values; discouraging tyrannical regimes; advancing prosperity; and creating a level playing field for lawful business activities."

Among four examples of kleptocratic rule given in the report was Saddam Hussein's Iraq: "Hussein looted Iraq of billions of dollars by skimming workers' profits, taking kickbacks, smuggling, and stealing state funds. He used these ill-gotten gains to maintain despotic power, develop and purchase weapons, and enrich his family, cronies, and himself." Of course, every charge made against Saddam was true, but the same charges, and some even more horrendous, equally apply to America's top politicians and plutocrats. The American government remains the preeminent global killer and terrorist. Saddam was nothing more than America's murderous protégé who outgrew his indignant master and left the reservation.

On the same day of the release of the report, President Bush gave a statement on the global threat of kleptocracy to the world's democracies, the global rule of law, and the worldwide effort to combat international terrorism. Whether he knew it or not, his remarks were an indictment against his own administration:

"For too long, the culture of corruption has undercut development and good governance and bred criminality and mistrust around the world. High-level corruption by senior government officials, or kleptocracy, is a grave and corrosive abuse of power and represents the most invidious type of public corruption. It threatens our national interest and violates our values. It impedes our efforts to promote freedom and democracy, end poverty, and combat international crime and terrorism. Kleptocracy is an obstacle to democratic progress, undermines faith in government institutions, and steals prosperity from the people. Promoting transparent, accountable governance is a critical component of our freedom agenda."
American kleptocracy didn't begin when the Bush administration stole the people's votes in the 2000 election, and it didn't end when the Obama administration stole the people's hearts in the 2008 election. It was always there in the political background, waiting to be noticed. But, the mainstream's media's endless distractions and disinformation campaigns allowed the kleptocrats to live on the public's dough like social parasites, while the majority of the public staggered through life like blind bats being led into an exterminator's cave .

During the retardation of America's political process, if there was any inkling of real change voiced by a unified citizenry, then false political movements were started, or real ones subverted, by the kleptocrats to divide the people, and redirect their correct suspicions about wide-scale public theft and war crimes to inconsequential issues like gay marriage, and abortion.

Two years ago it was the false Obama change campaign that captivated the sleeping nation, and now in its place is the directionless and spiritless tea party phenomenon that was quickly captured by the Republican establishment. Two years from now the clever kleptocrats will set up a new pseudo-movement to satisfy the impulses of the blind and pathetic left, to be matched with another version of the tea party on the right, which perhaps will turn out to be even more foolish, xenophobic, and war-hungry than its current form.

Six months ago, William Astore wrote in an article called "American Kleptocracy: How Fears of Socialism and Fascism Hide Naked Theft" that America's tiny corrupt elite was able to screw the American public, while evading sustained and informed public scrutiny of their crimes because the country's real enemy, a kleptocracy, has not yet been correctly identified by the majority of the American people. Astore wrote:

"If we were to take and honest look at America's blasted landscape of "losers" and the far shinier, spiffier world of "winners," we'd have to admit that it wasn't signs of onrushing socialism or fascism that stood out, but of staggeringly self-aggrandizing greed and theft right in the here and now. We'd notice our public coffers being emptied to benefit major corporations and financial institutions working in close alliance with, and passing on remarkable sums of money to, the representatives of "the people." We'd see, in a word, kleptocracy on a scale to dazzle. We would suddenly see an almost magical disappearing act being performed, largely without comment, right before our eyes."
The only way for the people of any country to address a kleptocratic government is by firing the corrupt political cronies, indicting the criminal banksters who profited from fraudulent government deals, removing the kleptocratic bloodsuckers from office, and taking back the levers of power wholesale. Justice must be done in America, otherwise, there won't be freedom or security. Economic and national recovery can't be accomplished without aggressive resistance to the kleptocrats in Washington and Wall Street by a unified and determined country.

There are lessons in recent history that America can learn from as it battles its own demons in the dark halls of government. In 2001 Argentina experienced an economic collapse and kleptocratic looting similar to what is going now inside the land of the free. There was high unemployment, massive government debt, closed down factories, and banksters packing their bags with the help of their friends in political office. Journalists Avi Lewis and Naomi Klein made an excellent documentary called "The Take" about a group of Argentinian workers who got together on their own to reboot nearby factories, and start making goods again. While it may not appear radical for people to take control of abandoned factories and produce again, it made a big political impact. It was a brave and extraordinary act, and it gave impoverished families and communities the opportunity to restart their lives amidst an economic and social collapse.

America's solutions will differ from what Argentinian workers did, but the important point that should be taken from Argentina's example is that without resistance to the kleptocrats America will turn drastically poorer and despotic, if not totally destroyed, and replaced as the central body in a future dictatorial global government.

It would be best if America recovers its capitalist ethic and entrepreneurial spirit, removes the national security edifice, restores its envious Republic, limits Wall Street's disproportionate role in the economy, and strictly follows the rule of law in all avenues of public life.

But if nothing is done, if a legitimate, determined, peaceful, and nationwide movement doesn't emerge to take on the murderous kleptocrats in Washington, then Iran may be hit by America, which will surely lead to a new world war, followed by the final trappings of the aforementioned dictatorial global government, based in America. That must not happen. Mankind's destiny is peace and liberty, not war and slavery. It is time that we all manifest this destiny in the streets of our cities.

T.S. Eliot:

"For the question of questions, which no political philosophy can escape, and by the right answer to which all political thinking must in the end be judged, is simply this: What is Man? what are his limitations? what is his misery and what his greatness? and what, finally, his destiny?" (The Literature of Politics, a lecture by Eliot delivered in London on April 19th, 1955).

Saman "Truth Excavator" Mohammadi is a blogger and a full-time university student, currently living in Toronto, Canada. His blog is

Thursday, October 21, 2010

Who is responsible for the mortgage foreclosure crisis? Should there be a foreclosure moritorium? What is the true cost of 10 years of America's wars? Which would be best for the economy now, austerity or stymulus?

Nobel-Prize-winning economist Joseph Stiglitz answers these questions and others in this 20 October 2010 interview:

Want to know more about the mortgage foreclosure crisis? See my preceding post.

"The lawsuits [filed by state attorneys general] described a vast 'conspiracy' in which Countrywide [a Bank of America subsidiary] provided financial incentives to large networks of brokers in exchange for their duping borrowers into taking out toxic loans."

Published on The Nation (

The Bank of America Mortgage Settlement Fiasco

Alex Ulam | October 13, 2010

Research support for this article was provided by the Investigative Fund at The Nation Institute.

Just as the American housing market was starting to recover from its worst battering since the Great Depression, a new scandal, an epidemic of flawed or fraudulent mortgage documents, threatens to send not just the housing market but the entire economy back into a tailspin. As we go to press, forty-nine state attorneys general have announced an investigation of the mortgage-servicing industry, in the wake of decisions by Bank of America, JPMorgan Chase, Ally Financial's GMAC and other banks to suspend some foreclosures, and amid demands by some lawmakers for a nationwide moratorium on all foreclosures.

It's impossible to tell at this early stage how deep the new crisis extends, but as they begin their investigation, the attorneys general would do well to re-examine the deeply flawed 2008 agreement with Bank of America in resolving the Countrywide Financial scandal, the largest anti–predatory lending settlement in US history. If they do, maybe they'll get it right this time.

On October 6, 2008, a scant three weeks after Lehman Brothers filed for bankruptcy, with the financial crisis in full swing, California Attorney General Jerry Brown called a press conference in San Francisco. He announced that day, to great fanfare, "the biggest loan modification in American history." Brown joined Illinois Attorney General Lisa Madigan in leading negotiations for eleven states that had sued Countrywide, the largest mortgage lender in the country. He held up Countrywide, which had been acquired by Bank of America some months earlier, as a symbol of all that had gone wrong in the housing bubble.

"Countrywide exploited the American dream of homeownership," Brown said in announcing his lawsuit the previous June. He charged the lender with deceiving borrowers by misrepresenting loan terms, hiding scheduled payment increases and persuading people to sign up for loans they couldn't afford. "Countrywide was, in essence, a mass-production loan factory, producing ever increasing streams of debt without regard for borrowers," he said. "Californians...were ripped off by Countrywide's deceptive scheme."

When Madigan announced her state's lawsuit, she took to the stage with a single mother who'd lost her home after refinancing a fixed-rate loan with one from Countrywide featuring a ballooning adjustable rate. "Borrowers were in loans that they didn't understand, they couldn't afford and they couldn't get out of," Madigan said. "The failure of these loans is what has caused the foreclosure crisis here in Illinois and across our country. And the aim of today's lawsuit is to hold Countrywide accountable."

If all fifty states were to sign on to the settlement, Brown's office estimates (forty-four have so far), it would provide $8.68 billion in reduced payments and fee waivers to some 400,000 Countrywide borrowers struggling to stay in their homes. And a small Foreclosure Relief Fund of $150 million would provide direct payments to Countrywide borrowers who have already lost their homes to foreclosure. Various media called the settlement a "landmark," "a win for homeowners" and "the nation's most comprehensive mortgage-modification program," reporting that 8,000 homeowners in Ohio, 13,000 in Arizona, 57,000 in Florida and 120,000 in California would all "escape foreclosure" through major loan modifications. Relief Is in Sight, read one headline.

But two years later, many Countrywide borrowers facing foreclosure have not even been notified that they may qualify for the settlement. It has kept, at best, about 134,000 families in their homes, and most of these only temporarily. Countrywide and its parent company, Bank of America, have blocked many subprime borrowers from access to the best aspect of the deal—principal reduction—in favor of short-term fixes that could easily spell disaster down the road. The settlement is silent on the question of second liens—home equity loans—which have played such a significant part in the foreclosure crisis, jeopardizing the possibility of truly affordable modifications. And the biggest loophole of all? Bank of America has the right to foreclose on the victims of Countrywide's predation whenever its analysts determine—using an undisclosed formula—that it can recoup more money through foreclosure than by modifying the loan.

In fact, the settlement has functioned more as loss mitigation for BofA and investors in mortgage-backed securities than as recompense for victims of predatory lending, says Alan White, an associate professor of law at Valparaiso University and an expert on the subprime crisis. "You are not actually asking [Bank of America] to give up money," says White, who frequently testifies before Congress on mortgage issues. "You are asking them to do something that will make them more money or mitigate their losses. It is a weird way to have somebody pay for past misconduct."

"The state attorneys general have done far more than anyone else, and they were under tremendous pressure not to act," says William Black, an associate professor of economics and law at the University of Missouri, Kansas City, and a federal fraud investigator during the savings and loan scandal. "That said, the settlement does not go to the basic problem, which was fraud by Countrywide."

* * *

The lawsuits described a vast "conspiracy" in which Countrywide provided financial incentives to large networks of brokers in exchange for their duping borrowers into taking out toxic loans. In violation of state law, brokers concealed or misrepresented the steep monthly payment increases borrowers faced when mortgage rates readjusted a year or two down the road.

For several years, the scam worked. Countrywide grew from originating $62 billion in loans in 2000 to more than $463 billion in 2006, while the lender's securities trading volume more than quintupled, from $647 billion in 2000 to $3.8 trillion in 2006. The company's CEO, the flashily dressed and perma-tanned Angelo Mozilo, became one of the highest-paid executives in the nation, with an influence on markets approaching that of Alan Greenspan.

The state lawsuits expose just how Countrywide built its sprawling empire. One common loan product that came under harsh criticism in the lawsuit was the hybrid adjustable rate mortgage, or ARM, in which mortgage rates were fixed for two to three years while borrowers made interest-only payments. Afterward borrowers got hit with "payment shock" when mortgage principal was added onto their monthly payments just as the starter interest rate converted to a variable rate that could shoot up to as high as 15 percent.

Brown's lawsuit charges that Countrywide's goal was to generate loans that paid the highest possible interest rate—not loans that offered the best deal for their customers. Low-income, first-time homebuyers became some of the best targets: the riskier the loan, the higher the interest rate. Countrywide packaged many of these loans into mortgage-backed securities and sold them to Wall Street for windfall profits. Securities comprising Countrywide loans were in turn used to structure collateralized debt obligations, or CDOs, the implosion of which almost brought down the US financial system. Risky Countrywide loans were linked to some of the most toxic CDOs. On July 24, 2007, when Mozilo announced in a call with Wall Street bankers that housing prices would collapse on a scale not seen since the Depression, widespread panic ensued. By the end of 2007, according to Countrywide's own estimates, a staggering 27 percent of the lender's subprime loans were delinquent.

Once disaster struck, a quick settlement with the state attorneys general, under which Countrywide accepted no guilt and faced little financial liability, was not such a bad deal for the company. The settlement required Countrywide to make only 50,000 loan modifications nationwide and did not set a dollar amount on how much these modifications had to save borrowers. Most of the loans covered by the settlement fell into one of two major types issued between 2004 and 2007, at the height of the housing boom. One was the notorious pay-option ARM, in which the loan balance increased each month for borrowers who made only the minimum payment. Countrywide absurdly classified these loans as "prime" products—even though many of them went to borrowers with very low credit scores—making it easier to sell them on the secondary market. The other was the subprime ARM, which had a fixed interest rate for a set period and then an adjustable rate for the remainder of the term.

* * *

To comply with the settlement, Bank of America set up the Countrywide National Homeownership Retention Program as a vehicle for providing relief. And the deal appeared, at first, to provide it. Eligible borrowers, according to Brown's analysis of the deal, may be considered for a range of modifications. Those with pay-option ARMs can reduce their outstanding balance to 95 percent of their home's current value, getting them out from under water. In addition, borrowers with subprime ARMs may qualify to pay interest for only ten years, get interest-rate reductions and even have their interest rate permanently capped at the introductory rate. But Countrywide has no obligation to offer these terms to any particular eligible borrower.

A key weapon in BofA's arsenal is something called a foreclosure avoidance budget, which gives the bank the option of foreclosing on homeowners whenever, in the judgment of the bank's analysts, more money can be recouped by foreclosing than by modifying the loan. Housing advocates speak with frustration of how BofA often refuses to grant modifications to eligible borrowers, based solely on the bank's analysis of its foreclosure avoidance budget. Yet bank officials have refused to make public how they calculate that budget. Lisa Sitkin, a lawyer with Housing and Economic Rights Advocates, an Oakland-based nonprofit, says she repeatedly attempted to obtain that information from BofA. "One of the things we kept asking," she says, "is, Can we see those analyses? Can we see the foreclosure avoidance budget? The answer was always no." In the end, she simply gave up on using the Countrywide settlement as a means of helping borrowers. Even information on how many homeowners are facing foreclosure under the foreclosure avoidance budget is not publicly available. I requested these numbers from the California attorney general's office, which directed me to Bank of America, which refused to divulge the data.

Last January I interviewed Terry Francisco, Bank of America's senior vice president for public relations and communications, at a meeting between BofA executives and distraught homeowners in a church in Antioch, California, and he said something telling: "We don't call it a settlement, but our agreement with the attorneys general." Apparently BofA doesn't believe it owes anybody anything.

Despite Bank of America's failure to help hundreds of thousands of homeowners ruined by Countrywide, the bank claims it is on track to fulfill its obligations under the settlement. According to the one publicly available page of a quarterly compliance report the bank is required to file with the state attorneys general, as of the end of the second quarter of 2010, BofA had modified a total of 134,217 loans under the settlement, achieved an expected interest and principal savings for borrowers of $3.4 billion and provided $177.6 million in relief to people who had lost their homes to foreclosure.

These numbers look impressive, at first glance. But a September 2009 study by Citibank of the loans covered by the settlement projected that 50 percent of the modified loans are so untenable they will re-default within a year. The terms being offered are so bad that many lawyers are not bothering to seek relief, says Nathan Fransen, an attorney representing underwater borrowers northeast of Los Angeles. Fransen estimates that in the past three years he has worked with about 1,000 clients seeking modifications, half of them from Countrywide. He projects that for borrowers who get the five-year, interest-only payments, there is going to be major trouble down the line. "We haven't seen the effect yet," he says. "They took them out of one loan that was a ticking time bomb and put them into another loan with ticking time bomb features."

Bank of America officials concede that re-default is a major threat, projecting a rate of 20–30 percent. But they claim most of these defaults will be a product of growing unemployment, not unfair loan modifications. Housing counselors and attorneys tell a different story. They say the modifications BofA is offering under the settlement are not sustainable even for many borrowers with jobs. "As far as I know, none of our clients have gotten a modification under this program," says Sheri Powers, an attorney and director of the Unity Council, a nonprofit community development corporation based in Oakland. "The offers I have seen so far are basically a low-interest-only, fixed rate for five years, and then the loan converts to a principal and interest, which of course, depending on the total amount due, could be a huge jump in the person's total monthly payment."

* * *

As it turns out, BofA has had good reason not to make its modifications affordable for mortgages now owned by a third party, such as the public employee pension funds that invested heavily, and disastrously, in Countrywide's mortgage-backed securities. From 2004 to 2007, the years covered by the settlement, Countrywide sold most of its first-lien subprime loans as mortgage-backed securities or loan packages, but it generally kept the lucrative servicing contracts. BAC Home Loan Servicing (formerly Countrywide Home Loans Inc.), Countrywide's servicing arm, acts as a bill collector, gathering mortgage payments from borrowers and distributing these payments to the investors who actually own the mortgages. Servicers earn a small percentage of mortgage payments, but what has made the business especially profitable are late fees and other ancillary costs such as property inspections, collected from borrowers in delinquency and in default.

Those revenues will be lost through the settlement with the state attorneys general, which requires BofA to waive outstanding late fees for delinquent Countrywide borrowers who receive a modification. But BofA can start the lucrative late-fee gravy train all over for all the borrowers who re-default on modified loans—a staggering number, if the Citibank projections prove to be accurate. When these financially exhausted borrowers finally go into foreclosure, any outstanding late fees can be tacked onto the bill BofA submits to investors.

Only about 12 percent of the first-lien loans initiated by Countrywide remain on BofA's books. Investors in mortgage-backed securities, including major pension funds like CalPERS (the California Public Employees' Retirement System), own the other 88 percent, and it is these investors who will bear most of the expense of complying with the settlement, in the form of permanently reduced principal and interest payments on their bond holdings. Believe it or not, this aspect of the deal was overlooked by the settlement. Richard Blumenthal, attorney general of Connecticut, one of the original parties to the suit, seems to have missed it entirely, claiming in his October 2008 announcement, "This settlement will cost BofA as much as $8.6 billion, but no cost, not a dime, to taxpayers."

In fact, as it turned out later, much of the settlement's cost would be covered by taxpayers. Bank of America is allowed to use federal incentives under President Obama's $75 billion Home Affordable Modification Program (HAMP) toward the loan modifications it is required to make as the mortgage servicer for the Countrywide portfolio. In total, of its entire Countrywide financial servicing portfolio—which goes beyond the loans covered by the settlement—BofA is eligible for as much as $4.5 billion in federal incentives for completed modifications, according to an analysis by the Center for Public Integrity as reported in Mother Jones. That's a hefty government rebate.

There are indications that Bank of America's slow progress on loan modifications is intentional. Many service providers on the front lines of the crisis were unaware of the settlement more than a year after it took effect. Take Walter Dees, a team leader in the housing department of Clearpoint Credit Counseling, a HUD-approved counseling agency in Los Angeles. Of the hundreds of Countrywide borrowers he's tried to obtain loan modifications for, "not one of them has mentioned anything regarding the attorneys general modification," he says.

Why don't borrowers know about the settlement? If they received a notification letter like the one Bank of America officials gave me after weeks of prodding, they would have no clue they were one of the covered homeowners. Nowhere in the letter is there explicit mention of the settlement. There's no mention of borrowers' rights, such as waiving of late fees for those who qualify for modification. And the letter fails to mention the settlement's most attractive modification option: principal write-down, the only measure that could make a significant difference to borrowers who have seen the value of their homes decline by 50 percent or more.

Bank of America's opaque public outreach apparently passes muster with the California attorney general. An official in the AG's office who declined to be named told me the notification letter "is not necessarily going to reference the settlement." He went on to express concern about the plaintiffs themselves, the very people the settlement was designed to protect. "There is a moral hazard problem with all of this, which is that you don't want to encourage borrowers who can afford their loans to default, or borrowers who don't believe they were victims of fraud to default," he says. "So there is a fine line that had to be walked in figuring out how to publicize, announce and communicate with borrowers."

* * *

The settlement's most fatal flaw may be its failure to cover second liens. Bank of America still owns a large number of Countrywide's second liens outright, including its once popular Home Equity Lines of Credit (HELOCs). Today the bank is the largest holder of second-lien loans in the country, which are valued at $145 billion. (Second-lien loans, which are tacked onto the original first-lien mortgage, include home-equity loans used to finance everything from home improvements to hospitalization to coverage of 15–20 percent of the purchase price of a house.)

Brown alleges that Countrywide employees broke the same laws in selling those loans as they did in selling first liens. According to the California lawsuit, Countrywide loan officers "further[ed] their deceptive scheme" by "urging borrowers to encumber their homes up to 100% (or more) of the assessed value; and placing borrowers in 'piggyback' second mortgages in the form of higher interest HELOCs while obscuring their monthly payment obligations."

A settlement that covered second liens would have improved the prospects for victims of Countrywide's predations. Federal officials and mortgage analysts have identified second liens as a major factor in at least half the mortgages in danger of default. Such a loan works against borrowers in several ways. Not only does it stick them with a greater debt burden; it also stands in the way of principal reduction on the first mortgage, since a second lien must usually be wiped out before principal can be written down on the first loan.

The attorneys general seem to have left this gaping loophole for pure expediency. "We do allege misconduct related to the origination of second liens and HELOCs," says the California AG official. "However, for purposes of settling the case, we wanted to craft a settlement that, while not perfect, would have the most effective chance of saving homeowners as quickly as possible. We were in a situation where the housing crisis was expanding by the moment. They [Bank of America] could have dragged out the negotiations for two years, during which time innumerable residents of California and other states could have lost their homes to foreclosure."

Earlier this year Bank of America finally indicated some willingness to address the second-lien issue. On January 26 the bank announced to much positive press that it was the first servicer to sign up for a resuscitated federal effort known as the Second Lien Modification Program, which the Obama administration had been trying to get off the ground since spring 2009.

In March, facing additional legal action over Countrywide's predatory lending practices, Bank of America reached another settlement, this one with Massachusetts. Under that deal, the settlement Brown negotiated was expanded—Bank of America would now offer principal reductions to about 45,000 severely underwater Countrywide borrowers. Notably, BofA will offer these principal reductions only to borrowers who qualify for HAMP, under which the bank gets bailed out by taxpayers.

The Countrywide settlement, says Kevin Stein, associate director of the California Reinvestment Coalition, a statewide organization that advocates for low-income communities, has failed to protect homeowners who were the victims of predatory lending on an epidemic scale. "Fraud and predatory lending really created this crisis we are in, and nobody is taking that into account," says Stein. "That was a concern we had with the original settlement. They don't admit any fraud."

Now state attorneys general might finally have an opportunity to help the thousands of defrauded Countrywide borrowers who have fallen through the cracks. On October 8 Bank of America announced that it was temporarily suspending foreclosures in all fifty states in response to revelations of false or fraudulent documentation and at least one BofA "robo-signer" who approved thousands of foreclosure papers without proper review. Even so, BofA appears confident that it has done nothing wrong. "We will stop foreclosure sales until our assessment has been satisfactorily completed," states a BofA press release. "Our ongoing assessment shows the basis for our past foreclosure decisions is accurate. We continue to serve the interests of our customers, investors and communities. Providing solutions for distressed homeowners remains our primary focus."

It's up to the attorneys general, in their newly announced investigation, to hold BofA to its word.

Wednesday, October 20, 2010

New Study: "The observation that Americans are spending relatively more on health but living relatively shorter, less healthy lives has led some critics to allege that the US health care system is 'uniquely inefficient.'"

US slips to 49th in life expectancy: study

By Sahil Kapur
Monday, October 18th, 2010 -- 8:23 am

The United States currently ranks 49th in the world in overall life expectancy, according to a study published in the academic journal Health Affairs, slipping dramatically during the last decade.

"As of September 23, 2010, the United States ranked forty-ninth for both male and female life expectancy combined," concludes the study, conducted by Columbia University health policy professors Peter A. Muennig and Sherry A. Glied, which will appear in the November edition of the influential peer-reviewed journal.

The noteworthy decline is highlighted by the fact that in 1999, the World Health Organization ranked the US as 24th in the world in the same category, life expectancy.

The report by Muenning and Glied found the prime culprit of the plunge to be America’s deteriorating health care system, marred by ever-rising costs and growing numbers of uninsured and under-insured individuals.

Noting that the United States spends over twice as much per capita on health care than other industrialized nations, it adds: "The observation that Americans are spending relatively more on health but living relatively shorter, less healthy lives has led some critics to allege that the US health care system is 'uniquely inefficient.'"

The findings present a stark contrast to the claim – today an article of faith in the American conservative movement – that the United States has the best health care system in the world.

The United States, as is widely known, remains the only advanced democracy without a universal health care program. But sweeping reform legislation enacted by this March, while limited in its capacity for cost controls, offers a significant step towards universality – it is projected by the nonpartisan Congressional Budget Office to insure 94 percent of Americans in ten years, up from 83 percent today.

The authors of the report also posited that high rates of obesity, smoking, homicides and traffic fatalities may have contributed to the decline.

The study was flagged by a Daily Kos blogger and elevated by Glenn Greenwald of Salon. Apart from coverage in some blogs, medical journals, and an article by Reuters, it received scant attention in the mainstream US press.

Tuesday, October 19, 2010

Chris Hedges: "Aristophanes too lived in a time of endless war. He knew that war always empowered anti-democratic forces."

How Democracy Dies: Lessons From a Master

Posted on Oct 11, 2010

The ancient Greek playwright Aristophanes spent his life battling the assault on democracy by tyrants. It is disheartening to be reminded that he lost. But he understood that the hardest struggle for humankind is often stating and understanding the obvious. Aristophanes, who had the temerity to portray the ruling Greek tyrant, Cleon, as a dog, is the perfect playwright to turn to in trying to grasp the danger posed to us by movements from the tea party to militias to the Christian right, as well as the bankrupt and corrupt power elite that no longer concerns itself with the needs of its citizens. He saw the same corruption 2,400 years ago. He feared correctly that it would extinguish Athenian democracy. And he struggled in vain to rouse Athenians from their slumber. 

There is a yearning by tens of millions of Americans, lumped into a diffuse and fractious movement, to destroy the intellectual and scientific rigor of the Enlightenment. They seek out of ignorance and desperation to create a utopian society based on “biblical law.” They want to transform America’s secular state into a tyrannical theocracy. These radicals, rather than the terrorists who oppose us, are the gravest threat to our open society. They have, with the backing of hundreds of millions of dollars in corporate money, gained tremendous power. They peddle pseudoscience such as “Intelligent Design” in our schools. They keep us locked into endless and futile wars of imperialism. They mount bigoted crusades against gays, immigrants, liberals and Muslims. They turn our judiciary, in the name of conservative values, over to corporations. They have transformed our liberal class into hand puppets for corporate power. And we remain meek and supine.

The huge amount of taxpayer money doled out to Wall Street, investment banks, the oil and natural gas industry and the defense industry, along with the dismantling of our manufacturing sector, is why we are impoverished. It is why our houses are being foreclosed on. It is why some 45 million Americans are denied medical care. It is why our infrastructure, from public schools to bridges, is rotting. It is why many of us cannot find jobs. We are being fleeced. The flagrant theft of public funds and rise of an obscenely rich oligarchic class is masked by the tough talk of demagogues, themselves millionaires, who use fear and bombast to keep us afraid, confused and enslaved.

Aristophanes saw the same psychological and political manipulation undermine the democratic state in ancient Athens. He repeatedly warned Athenians in plays such as “The Clouds,” “The Wasps,” “The Birds,” “The Frogs” and “Lysistrata” that permitting political leaders who shout “I shall never betray the Athenian!” or “I shall keep up the fight in defense of the people forever!” to get their hands on state funds and power would end with the citizens enslaved.

“The truth is, they want you, you see, to be poor,” Aristophanes wrote in his play “The Wasps.” “If you don’t know the reason, I’ll tell you. It’s to train you to know who your tamer is. Then, whenever he gives you a whistle and sets you against an opponent of his, you jump out and tear them to pieces.”

Our democracy, through years of war, theft and corruption, is also being diminished. But the example Aristophanes offers is not a hopeful one. He held up the same corruption to his fellow Greeks. He repeatedly chided them for not rising up and fighting back. He warned, ominously, that by the time most citizens awoke it would be too late. And he was right. The appearance of normality lulls us into a false hope and submission. Those who shout most loudly in defense of the ideals of the founding fathers, the sacredness of Constitution and the values of the Christian religion are those who most actively seek to subvert the principles they claim to champion. They hold up the icons and language of traditional patriotism, the rule of law and Christian charity to demolish the belief systems that give them cultural and political legitimacy. And those who should defend these beliefs are cowed and silent.   

“For a considerable length of time the normality of the normal world is the most efficient protection against disclosure of totalitarian mass crimes,” Hannah Arendt wrote in “The Origins of Totalitarianism.” “Normal men don’t know that everything is possible, refuse to believe their eyes and ears in the face of the monstrous. ... The reason why the totalitarian regimes can get so far toward realizing a fictitious, topsy-turvy world is that the outside non-totalitarian world, which always comprises a great part of the population of the totalitarian country itself, indulges in wishful thinking and shirks reality in the face of real insanity. ...”

All ideological, theological and political debates with the representatives of the corporate state, including the feckless and weak Barack Obama, are useless. They cannot be reached. They do not want a dialogue. They care nothing for real reform or participatory democracy. They use the tricks and mirages of public relations to mask a steadily growing assault on our civil liberties, our inability to make a living and the loss of basic services from education to health care. Our gutless liberal class placates the enemies of democracy, hoping desperately to remain part of the ruling elite, rather than resist. And, in many ways, liberals, because they serve as a cover for these corporate extremists, are our greatest traitors. 

Aristophanes too lived in a time of endless war. He knew that war always empowered anti-democratic forces. He saw how war ate away at the insides of a democratic state until it was hollowed out. His play “Lysistrata,” written after Athens had spent 21 years consumed by the Peloponnesian War, is a satire in which the young women refuse to have sex with their men until the war ends and the older women seize the Acropolis, where the funds for war are stored. The play called on Athenians to consider radical acts of civil disobedience to halt a war that was ravaging the state. The play’s heroine, Lysistrata, whose name means “Disbander of Armies,” was the playwright’s mouthpiece for the folly and self-destructiveness of war. But Athens, which would lose the war, did not listen.

The tragedy is that liberals and secularists, like Obama, are not viewed as competitors by the corporate forces that hold power, but as contaminates that must be eliminated. They have sought to work with forces that will never be placated. They have abandoned the most basic values of the liberal class to play a game that in the end will mean their political and cultural extinction. There will be no swastikas this time but seas of red, white and blue flags and Christian crosses. There will be no stiff-armed salutes, but recitations of the Pledge of Allegiance. There will be no brown shirts but nocturnal visits from Homeland Security. The fear, rage and hatred of our dispossessed and confused working class are being channeled into currents that are undermining the last vestiges of the democratic state. These dangerous emotions, directed against a liberal class that as in ancient Athens betrayed the population, have a strong appeal. And unless we adopt the radicalism held by Aristophanes, unless we begin to hinder the functioning of the corporate state through acts of civil disobedience, we are finished.

Let us not stand at the open gates of the city meekly waiting for the barbarians. They are coming. They are slouching towards Bethlehem. Let us, if nothing else, like Aristophanes, begin to call our tyranny by its name. 
Author's Bio: Chris Hedges, currently a senior fellow at The Nation Institute and a Lecturer in the Council of the Humanities and the Anschutz Distinguished Fellow at Princeton University, spent nearly two decades as a foreign correspondent in Central America, the Middle East, Africa and the Balkans. Hedges, who has reported from more than 50 countries, worked for The Christian Science Monitor, National Public Radio, The Dallas Morning News and The New York Times, where he spent fifteen years. He is the author of the best selling "War Is a Force That Gives Us Meaning," which draws on his experiences in various conflicts to describe the patterns and behavior of nations and individuals in wartime. The book, a finalist for The National Book Critics Circle Award for Nonfiction, was described by Abraham Verghese, who reviewed the book for The New York Times, as "...a brilliant, thoughtful, timely and unsettling book whose greatest merit is that it will rattle jingoists, pacifists, moralists, nihilists, politicians and professional soldiers equally." Hedges was part of the New York Times team that won the 2002 Pulitzer Prize for the paper's coverage of global terrorism and he received the 2002 Amnesty International Global Award for Human Rights Journalism. He published his most recent book, "Losing Moses on the Freeway: The 10 Commandments in America" in June 2005. 

Paul Craig Roberts: "The 'war on terror' is now in its tenth year. What is it really all about?"

Predator drone launching Hellfire missile

The War On Terror

Posted By Paul Craig Roberts On October 15, 2010 @ 11:00 pm

Does anyone remember the "cakewalk war" that would last six weeks, cost $50-$60 billion, and be paid for out of Iraqi oil revenues?

Does anyone remember that White House economist Lawrence Lindsey was fired by Dubya because Lindsey estimated that the Iraq war could cost as much as $200 billion?

Lindsey was fired for over-estimating the cost of a war that, according to Joseph Stiglitz and Linda Bilmes, has cost 15 times more than Lindsey estimated. And the US still has 50,000 troops in Iraq.

Does anyone remember that just prior to the US invasion of Iraq, the US government declared victory over the Taliban in Afghanistan?

Does anyone remember that the reason Dubya gave for invading Iraq was Saddam Hussein’s weapons of mass destruction, weapons that the US government knew did not exist?

Are Americans aware that the same neoconservatives who made these fantastic mistakes, or told these fabulous lies, are still in control of the government in Washington?

The "war on terror" is now in its tenth year.  What is it really all about?

The bottom line answer is that the "war on terror" is about creating real terrorists. The US government desperately needs real terrorists in order to justify its expansion of its wars against Muslim countries and to keep the American people sufficiently fearful that they continue to accept the police state that provides "security from terrorists," but not from the government that has discarded civil liberties.

The US government creates terrorists by invading Muslim countries, wrecking  infrastructure and killing vast numbers of civilians. The US also creates terrorists by installing puppet governments to rule over Muslims and by using the puppet governments to murder and persecute citizens as is occurring on a vast scale in Pakistan today.

Neoconservatives used 9/11 to launch their plan for US world hegemony. Their plan fit with the interests of America’s ruling oligarchies. Wars are good for the profits of the military/security complex, about which President Eisenhower warned us in vain a half century ago.  American hegemony is good for the oil industry’s control over resources and resource flows. The transformation of the Middle East into a vast American puppet state serves well the Israel Lobby’s Zionist aspirations for Israeli territorial expansion.

Most Americans cannot see what is happening because of their conditioning.  Most Americans believe that their government is the best on earth, that it is morally motivated to help others and to do good, that it rushes aid to countries where there is famine and natural catastrophes. Most believe that their presidents tell the truth, except about their sexual affairs.

The persistence of these delusions is extraordinary in the face of daily headlines that report US government bullying of, and interference with, virtually every country on earth. The US policy is to buy off, overthrow, or make war on leaders of other countries who represent their peoples’ interests instead of American interests. A recent victim was the president of Honduras who had the wild idea that the Honduran government should serve the Honduran people.

The American government was able to have the Honduran president discarded, because the Honduran military is trained and supplied by the US military. It is the same case in Pakistan, where the US government has the Pakistani government making war on its own people by invading tribal areas that the Americans consider to be friendly to the Taliban, al-Qaeda, "militants" and "terrorists."

Earlier this year a deputy US Treasury secretary ordered Pakistan to raise taxes so that the Pakistani government could more effectively make war on its own citizens for the Americans. On October 14 US Secretary of State Hillary Clinton ordered Pakistan to again raise taxes or the US would withhold flood aid. Clinton pressured America’s European puppet states to do the same, expressing in the same breath that the US government was worried by British cuts in the military budget. God forbid that the hard-pressed British, still reeling from American financial fraud, don’t allocate enough money to fight America’s wars.

On Washington’s orders, the Pakistani government launched a military offensive against Pakistani citizens in the Swat Valley that killed large numbers of Pakistanis and drove millions of civilians from their homes. Last July the US instructed Pakistan to send its troops against the Pakistani residents of North Waziristan. On July 6, Jason Ditz reported on that "at America’s behest, Pakistan has launched offensives against [the Pakistani provinces of] Swat Valley, Bajaur, South Waziristan, Orakzai, and Khyber."

A week later Israel’s US Senator Carl Levin (D-MI) called for escalating the Obama Administration’s policies of US airstrikes against Pakistan’s tribal areas. On September 30, the Pakistani newspaper, The Frontier Post, wrote that the American air strikes "are, plain and simple, a naked aggression against Pakistan."

The US claims that its forces in Afghanistan have the right to cross into Pakistan in pursuit of "militants." Recently US helicopter gunships killed three Pakistani soldiers whom they mistook for Taliban.  Pakistan closed the main US supply route to Afghanistan until the Americans apologized.

Pakistan warned Washington against future attacks. However, US military officials, under pressure from Obama to show progress in the endless Afghan war, responded to Pakistan’s warning by calling for expanding the Afghan war into Pakistan.  On October 5 the Canadian journalist Eric Margolis wrote that "the US edges closer to invading Pakistan."

In his book, Obama’s Wars, Bob Woodward reports that America’s puppet president of Pakistan, Asif Ali Zardari, believes that terrorist bombing attacks inside Pakistan for which the Taliban are blamed are in fact CIA operations designed to destabilize Pakistan and allow Washington to seize Pakistan’s nuclear weapons.

To keep Pakistan in line, the US government changed its position that the "Times Square Bombing" was the work of a "lone wolf." Attorney General Eric Holder switched the blame to the "Pakistani Taliban," and Secretary of State Clinton threatened Pakistan with "very serious consequences" for the unsuccessful Times Square bombing, which likely was a false flag operation aimed at Pakistan.

To further heighten tensions, on September 1 the eight members of a high-ranking Pakistani military delegation en route to a meeting in Tampa, Florida, with US Central Command, were rudely treated and detained as terrorist suspects at Washington DC’s Dulles Airport.

For decades the US government has enabled repeated Israeli military aggression against Lebanon and now appears to be getting into gear for another Israeli assault on the former American protectorate.

On October 14 the US government expressed its "outrage" that the Lebanese government had permitted a visit by Iranian President Ahmadinejad, who is the focus of Washington’s intense demonization efforts. Israel’s representatives in the US Congress threatened to stop US military aid to Lebanon, forgetting that US Rep. Howard Berman (D-CA) has had aid to Lebanon blocked since last August to punish Lebanon for a border clash with Israel.

Perhaps the most telling headline of all is the October 14 report, "Somalia’s New American Prime Minister." An American has been installed as the Prime Minister of Somalia, an American puppet government in Mogadishu backed up by thousands of Ugandan troops paid by Washington.

This barely scratches the surface of Washington’s benevolence toward other countries and respect for their rights, borders, and lives of their citizens.

Meanwhile, to silence the whistleblower website WikiLeaks and to prevent any more revelations of American war crimes, the "freedom and democracy" government in DC has closed down WikiLeaks’ donations by placing the company that collects its money on its "watch list" and by having the Australian puppet government blacklist WikiLeaks.

WikiLeaks is now akin to a terrorist organization. The American government’s practice of silencing critics will spread across the Internet.

Remember, they hate us because we have freedom and democracy, First Amendment rights, habeas corpus, respect for human rights, and show justice and mercy to all.

Read more by Paul Craig Roberts

Monday, October 18, 2010

French Workers and Students Know How to Deal with Governments Determined to Cut their Benefits in Order to Further Favor Those Already Favored by Society

Defiant millions take to the streets in battle over Nicolas Sarkozy's cuts

The return of students and workers in mass protests made the right shiver. But there was no battle of the barricades

Lizzy Davies
The Observer, Sunday 17 October 2010
Article history

The clouds hung heavily over the Place de la République and the statue of Marianne, France's heroine, was draped with demonstrators' balloons.

As protesters marched on the historic Parisian site of proletarian revolt, 17-year-old Romane scowled at the rain-filled sky. "At least this is proof we're not just here for the good weather," she said. On her jacket was pinned a placard scrawled with marker pen. "Carla, we're like you," it read. "We've been screwed by Sarko too."

Nicolas Sarkozy had feared that the rentrée – the time after the holidays when France returns to normal – would be warm, encouraging protesting masses on to the wide, Haussmann-designed boulevards, and he was right to be worried.

Languishing in the polls and engaged in an almighty battle to push through his flagship pension reform – taking the retirement age from 60 to 62 – the man once cast by some as the Gallic Margaret Thatcher is facing his most testing showdown with the notoriously bellicose unions.

The demonstration that drew people out in their hundreds of thousands was the fifth since last month, and Tuesday will bring another. Last week the protest movement snowballed, with strikes that closed schools, led to flights being cancelled and stopped trains. Fuel refineries halted production and parts of the country are already suffering shortages.

The pipeline supplying fuel to Charles de Gaulle airport was running again last night, having been down for several hours. "We have been able to get the supply of fuel to Paris airports started up again… which makes the threat of a shortage at Roissy-Charles de Gaulle distant," said Patrick Gandil, head of the civil aviation authority.

For Sarkozy, the next seven days will be crucial, some say the most important of his presidency. The Senate is expected to vote on the pensions bill on Wednesday, and it is likely to be ratified by the end of the month. Yet the pressure on the government remains strong. "The government does not want to budge, but there could end up being a gulf between what it wants and what it has to do," said Pierre Bréchon of Sciences Po University in Grenoble. "It is not possible to predict who will be the winner in a conflict like this. We will only know that once it is over."

At the demonstration, Romane disagreed. "We will keep this up, and we will get something for it," she said. "With all this mobilisation, if they don't listen to us there's a big problem in our country." The teenager was one of a legion of school pupils who joined protests last week with a zeal that sent a shiver down the spine of the rightwing establishment – for which a vision of students linking arms with workers recalled visions of protests past.

Since 1968, governments have been forced to cave in on reforms because of the volatile presence of la jeunesse dans la rue. "We could have another May 1968," sociologist Michel Fize told Le Parisien last week. "The situation now resembles it. A big social movement is perhaps emerging."

So far the reality has not lived up to these predictions. Hamstrung by a law passed within months of Sarkozy's election, guaranteeing minimum service on public transport and making every strike day a no-pay day, the grèves, or days of action, have not paralysed the country. In their severity, the disruptions to the refineries are the exception rather than the rule.

Yet to negate the movement's significance would be a mistake. It is by far the biggest industrial action Sarkozy has experienced since coming to power. For the man who vowed to drag France along the path to market reform, the showdown is a vital test. Will he push through a reform he argues is essential for the future, or will the potent blend of worker anger and youth revolt force a climbdown? "Even if he wins this, I think it could be a pyrrhic victory," said Jacques Reland of the London-based Global Policy Institute, one of many who believe the protests will contribute to a difficult re-election year for the president in 2012. He may win this battle, they say, but he may well not win the war.

"For us this is a protest not only against the pension reform but also against the wider politics of this government – politics that favour those who are already favoured by society," said 21-year-old Cécile Rimboud yesterday. Another protester, a man in his 70s, said at the Tuesday manif that he was not just protesting against the reform, but against a rightwing president who, from the beginning, "chose his side – the well-off". Their comments are telling. For while polls show most people recognise the flabby pension system needs reform, what they accuse Sarkozy of is pushing through changes that are unfair.

This, they say, gels with the man they have come to know over the past three years: a leader who panders to the chosen few and turns the screw on the masses. That the man pushing through the reform, labour minister Eric Woerth, spent the summer engulfed in a scandal surrounding France's richest woman and her huge tax rebate has rubbed salt in the wound. "There is a sense of injustice and also a sense that the priorities are all wrong," said Reland. "That sense is, I think, spreading through Europe."

There is no doubt that the standoff is being watched by governments and unions across Europe – all of which face similar challenges brought on by the long-term pressure of demography and the short-term pressure of budget holes deepened by the financial crisis.

With its frequent demos, feisty unions and semi-resurgent left, France's opposition may appear to have the best shot in Europe at victory over measures to raise retirement ages and extend contribution periods. But branding it a model battle would be wrong, say observers, arguing that the unions came too late to the fight and that the Socialist party has failed to provide a coherent opposition.

Despite the optimism on the streets, time is on Sarkozy's side and the standoff is likely to go in his favour. His supporters hope he will then be able to re-establish himself as a leader who can walk the walk and not just talk the talk. But he will feel no warmth from the people on the boulevards. "He has to listen to us," said Marcel, 32, a state employee. "If he doesn't, we will make him pay."

Here's a video on the same subject from theRealnews Network:

More at The Real News

Saturday, October 16, 2010

Democracy Now!: As Fraud Scandal Grows, White House Opposes National Moratorium on Foreclosures

October 12, 2010

As Fraud Scandal Grows, White House Opposes National Moratorium on Foreclosures

A coalition of as many as forty state attorneys general is expected to announce Wednesday a joint investigation into the recent revelations that major lenders may have committed fraud while forcing thousands of people out of their homes. While senior congressional Democrats have joined the calls for a national moratorium on foreclosures, the White House is arguing against punishing the industry. We speak to Democratic Rep. Ed Towns of New York.
Blogger's Note: If you missed my earlier post on this subject and are interested it knowing more, check it out.

Why Are Bailed-Out Banks Breaking into Struggling Borrowers’ Homes?

Last week Florida resident Nancy Jacobini revealed that an agent hired by her bank broke into her home after she fell behind on her mortgage payments. Thinking she was being burglarized, Jacobini called 911. We speak to Jacobini’s lawyer Matthew Weidner and Bruce Marks, the founder and CEO of the Neighborhood Assistance Corporation of America, a housing services organization that’s been calling for a national moratorium on foreclosures for years.

Friday, October 15, 2010

Ecuador: Were the Events of 30 September 2010 a Failed Coup or an Institutional Crisis?

Background/Preview (selected by blogger):

Exclusive documentary posted by theREALnews:

October 1, 2010

Ecuador President Defiant After Failed Coup 

This is a special report about the Police Force insurrection and kidnapping of Ecuadorian President Rafael Correa on September 30th, 2010. President Correa was held hostage for 11 hours by a large number of armed policemen inside the Quito Regiment. Eventually leading to street battles and a bloody ending that gripped a nation.

My name is Oscar Leon, reporter and documentary filmmaker from Ecuador. Between 2005 and 2007 I created the documentary "Third World Democracy Handbook" about the fall of President Lucio Gutierrez, at that time he was the 3rd President to fall in less than 10 years, had Rafael Correa fell he would have been the 4rd to fall in less than 14 years. Being a reporter in Ecuador during the "Lost Decade" I can bring some insight about what happened that day. Was this a institutional crisis? Or a foreign power's attempt to overthrow him? This infamous day is being utilized by both political sides. But what is the truth behind it? In order to get a better understanding of what happened on Part 1, we will explain some necessary context. In the Part 2 of this special report we will go over what took place on September 30th 2010.

Pt 1

Pt 2
More at The Real News

Thursday, October 14, 2010

Webster Tarpley: "Elizabeth Warren should ... use her new position to provide desperately needed relief to the American middle class against outrageous Wall Street abuses ... and not wait for the inevitable waffling that will come from the feckless Obama."

Advice to Desperate Congressional Dems: Ignore Wall Street Puppet Obama, and Demand a Five-Year Freeze on All Home Foreclosures in the Spirit of the Frazier-Lemke Act of 1935!

Webster G. Tarpley, Ph.D.
October 11, 2010

In the last phase of the election campaign, an issue has emerged which allows voters to separate Wall Street stooges in both parties from real advocates of the middle class. The issue is the massive campaign of foreclosures against the American middle class being carried out by Wall Street zombie bankers who owe their very existence to taxpayer bailouts. Since the world derivatives panic began in 2007, millions of homes each year have been seized by the Wall Street predators, sometimes under the legal color provided by adjustable rate mortgages and, as has now been revealed, often using completely illegal paperwork to throw average Americans and their families out on the street and frequently into poverty and destitution.

The fact that so many foreclosures have been illegal as well as immoral and antisocial has now brought the foreclosure reissue to critical mass. The deeply flawed paperwork used by many bankers in their attack on working people’s homes is now a scandal which is bringing out the populist pitchforks everywhere. Even title insurance companies are now declining to be a part of this swindle. This past Friday, Bank of America, the largest US bank, stopped foreclosures in all 50 states because of the threat of counter-suits and public backlash. Previously, JP Morgan Chase & Co., Ally Bank’s GMAC Mortgage unit, and PNC Financial had halted foreclosures in the 23 states where the consent of the judge is required in order to seize a home.

The current chaos in home foreclosures is once again the direct responsibility of the zombie bankers themselves, who have neglected all traditional legal and accounting standards concerning the necessary paper trails in their frenzied desire to securitize mortgage loans and make them into toxic derivatives in the form of asset-backed securities and mortgage backed securities. The zombie bankers, already the recipients of $24 trillion of public largess in the form of the various bailouts, have turned out to be incompetent even in the technical aspects of their own thieving racket.

But the chaos in the bankers’ filing systems is nothing compared to the chaos created by the millions of foreclosures they have engineered, based on adjustable-rate mortgages and similar misleading contracts which never should have been legal in the first place. For some time, it has been evident that the defense of the American middle class requires a blanket, orderly, federal freeze (or moratorium) on all foreclosures on primary residences, similar to the New Deal protections offered to family farms by the landmark Frazier-Lemke Act of 1935-1949 during the previous depression.

Desperate to avoid defeat at the hands of crazed Tea Party fanatics, top Dems are starting to grasp the explosive potential of this issue and calling for stopping foreclosures: “Senate Majority Leader Harry Reid (D-Nev) …. urged five large mortgage lenders to suspend foreclosures in his state until they establish ways to make sure homeowners don’t lose their homes improperly. Attorney General Eric Holder said that the government is looking into the matter, and Democratic lawmakers urged bank regulators and the Justice Department to probe whether mortgage companies violated laws in handling foreclosures,” according to AP.

Speaking on Fox News Sunday earlier today, “Rep. Debbie Wasserman Schultz (D-FL), a top House Democrat, said she backed a foreclosure moratorium and government talks with the banking industry to concoct ways to let lenders reshape troubled mortgages. She said the foreclosure problem has been ‘extremely vexing’ in her state” of Florida, AP reported.

Make the GOP Line Up in Defense of their Wall Street Masters

In a response of great clinical significance, the number two reactionary Republican in the House and would-be majority leader, Rep. Eric Cantor of Virginia, immediately rushed to defend the Wall Street parasites and their right to feast on the flesh of the American people. Cantor said that ‘”a national moratorium would remove the protections that lenders need.” “You’re going to shut down the housing industry” with a national stoppage, Cantor added, pontificating that “People have to take responsibility for themselves.”‘1

There it was: the eternal reactionary refrain of the New Deal-hating GOP: in a conflict between a citizen and a bank, the citizen will be on his or her own. Canter’s response demonstrates that any time the Democrats attack Wall Street, the Republicans are immediately obliged to throw off their protective camouflage of “tea party” populism, and line up to defend the bankers who own them. This is the dirty secret of the “libertarian” GOP.

Axelrod Offers Nothing but Quick Eviction

Unfortunately, but characteristically, an additional defense of the Wall Street hyenas came from the Obama White House. Financier stooge David Axelrod undercut both Reid and Wasserman-Shultz in his eagerness to shield the zombie banks, telling CBS’ Face the Nation: “I’m not sure about a national moratorium because there are in fact valid foreclosures that probably should go forward,” if their documents are accurate, and the public be damned. “Our hope is this moves rapidly and that this gets unwound very, very quickly,” he added. (AP) In other words, Axelrod and Obama see the solution as speeding up foreclosures so that the crisis can “bottom out” in an orgy of liquidations and homelessness — precisely as prescribed by the anti-human reactionaries of the Austrian school of economics touted by the GOP. If a new object lesson in Obama’s status as an abject Wall Street puppet were needed, here it was.

Congressional Democrats, if they wish to survive, must realize that Obama is nothing more than an anchor tied around their necks. They need to ignore him as party leader now, as a prelude to dumping him as their presidential candidate for 2012.

The Obama White House did respond to the public outrage against Wall Street’s foreclosures by refusing to sign the infamous Leahy-Sessions bill, which would legalize a broad range of foreclosures which are currently illegal, thus catapulting more millions into homelessness. This veto should have been carried out with great fanfare and with extreme prejudice as a direct and defiant challenge to Wall Street and its Republican minions, but Obama, always true to form, did it surreptitiously and almost apologetically, using a form of pocket veto to send the bill back to Congress. so that it can be “improved.”

Elizabeth Warren Should Declare a Freeze on Foreclosures

One person who could do a great deal for the faltering fortunes of the congressional Democrats is Elizabeth Warren, recently named as White House overseer of the new consumer financial protection agency. With the help of some aggressive lawyers, it ought to be possible for Warren to find something in the new FinReg law to use as the basis for a freeze on mass foreclosures, given the current public scandal of faked records. This could also be done under the authority given by existing states of emergency dating back to the aftermath of 9/11. During the last depression, the Frazier-Lemke Moratorium Act of 1935 halted foreclosures on family farms for a three-year period, provided that a local court of law would give its approval both as to the propriety of the delay and the adequacy of the rental to be paid in the interim. Frazier-Lemke was challenged in the courts, “but the Supreme Court upheld the law in Wright v. Vinton Branch of Mountain Trust Bank of Roanoke. After expiring in 1938, the act was renewed four times until 1949, when it expired.”2

The measure most urgently required today is a freeze on foreclosures on one and only one primary residence per family, to continue for five years or for the duration of the current world economic and financial depression, which ever lasts longer. The alternative is social chaos, with Hoovervilles and Obamavilles on a mass scale, and a tragic deterioration in the present and future productivity of the working adults and children being sacrificed on the altar of Wall Street’s insatiable greed.

Combined with state laws requiring mandatory mediation before foreclosure could be carried out, plus the creation of the Home Owners’ Loan Corporation, New Deal measures were able to stop about 90% of the foreclosure plague, and also offered meaningful assistance to the 10% who were still victimized. This was in an age when the money center Wall Street banks had not received massive public bailouts to save them from insolvency, as occurred in 2008-2009. A halt in foreclosures could be considered a belated expression of gratitude by the Wall Street tycoons to the American people, without whose tax dollars not one major Wall Street institution would have survived the world derivatives panic of September-October 2008.

While she is at it, Elizabeth Warren should also use her new position to provide desperately needed relief to the American middle class against outrageous Wall Street abuses in the following areas:

1. She should declare a ban on Adjustable Rate Mortgages, which are always fatally flawed because they never allow the homeowner to know in advance just what level of interest is going to be charged, no matter how clear their language and no matter how big the print in which they are set down. ARMs are thus the consumer financial equivalent of ticking time bombs, and there is no place for them in the modern US economy.
2. Warren should also set up a de facto 10% maximum ceiling on interest rates on consumer financial products all over the United States. This would merely restore the pre-1979 usury laws which generally established a 10% upper limit on interest rates until the coming of Paul Adolf Volcker and his lunatic 22% prime rate during his tenure as boss of the Federal Reserve under Carter and Reagan.
3. Predatory payday loans and car title loans would be largely ruled out by a 10% upper limit on yearly interest rates, but Warren should institute additional safeguards as needed to ban these two kinds of wildly abusive financial marketing practices.

Elizabeth Warren should take these actions immediately and on her own authority, and not wait for the inevitable waffling that will come from the feckless Obama. The current election season provides her with a golden opportunity to determine whether her new job carries any real power with it, or whether it was simply a sop to certain strata of left-liberal opinion. She should act now against foreclosures and exorbitant interest rates, and see if Obama fires her. The best guess here is that he won’t dare. She should do this right now, when Obama knows that the penalty for firing Warren would be massive disaffection and bitterness among left liberals who believes in her mission and who forced him to appoint her over the objections of Tiny Tim Geithner and other Wall Street operatives.

As for the Republicans, they will start howling bloody murder as soon as any Wall Street privilege is touched or any Wall Street abuse challenged. To get them to drop their posturing and do this in the midst of their populist-demagogical election campaign would be of the greatest benefit to congressional Democrats. With a perfect opportunity offered by the departure of enforcers like Rahm Emanuel and Axelrod, Ms. Warren should dare to struggle and dare to win — now.

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