CliffyWorld

The majority of hard working Americans, some burdened with second jobs, will have to come up with an additional $2,300 dollars for individuals or $6,000 dollars per household to pay off the $700 billion+ dollars given to U.S. Treasury Secretary Henry Paulson. This Robin Hood in reverse strategy takes from the poor and gives to the rich. Your legislators didn't care or think about your struggle to make ends meet, the high cost of fuel and food or your collapsing retirement fund when they rushed to pass the economic bailout bill. Nope, they were thinking about paying off their corporate cronies and of course taking their well deserved paid vacations.

Just after the $700 billion dollar economic bailout votes were cast the bosses of the Democratic do nothing Senate and Congress: Nancy Pelosi (D-CA), Harry Reid (D-NV), Steny Hoyer (D-MD) granted your Senators and Congressmen a little rest and relaxation for at least until after the November elections. Both houses remain open for Pro Forma sessions, the daily fantasy that must be acted out by a few unlucky blokes who missed the boat. Pro Forma according to the C-SPAN Congressional Glossary is: A daily meeting of the House or Senate during which no votes are held and no legislative business is conducted. The session "in form only" is held for purposes of meeting the 3-day rule in the Constitution. It requires each House to gain the permission of the other for recesses longer than 3 days. When the permission is not forthcoming, or not requested in time, the affected chamber convenes briefly with hardly anyone in attendance [the opening prayer, routine announcements, and sometimes short non-legislative speeches are conducted], and then adjourns.

As the stock market plummets and the housing market tumbles our legislators are at play neglecting to pass the Congressional Economic Stimulus Package or not finishing the bill to extend unemployment insurance or act upon the credit card holder bill of rights or the bill to provide aid to local and state governments assisting them with their infrastructure. Dianne Feinstein (D-CA) will return to the Senate after California goes broke.

Christopher Dodd (D-CT) Chairman of the Senate Banking Committee proposed a housing bailout to the Senate floor in June 2008 that would assist troubled sub-prime mortgage lenders such as Countrywide Financial. In 2003 Dodd received mortgages from Countrywide at allegedly below-market rates on his Washington, D.C. and Connecticut homes. Countrywide has also contributed a total of $21,000 to Dodd’s campaigns since 1997. Dodd has received approximately $70,000 in campaign contributions from Bank of America, which is buying Countrywide. No American politician has received more contributions from Fannie Mae and Freddie Mac than Dodd's combined $133,900.

During the summer of 2008, Treasury Secretary Henry Paulson sought provisions enabling the Treasury to add additional capital and regulatory oversight over Fannie Mae and Freddie Mac. These provisions were part of the bill signed by President George W. Bush. At the time, it was estimated that the federal government would need to spend $25 billion on a bailout of the firms. During this period, Dodd denied rumors these firms were in financial crisis. He called the firms "fundamentally strong" said they were in "sound situation" and "in good shape" and to "suggest they are in major trouble is not accurate". He suggested observers were panicking "There's sort of a panic going on today, and that's not what ought to be. The facts don't warrant that reaction, in my opinion," period, Dodd denied rumors these firms were in financial crisis. Based upon Dodd’s statement, thousands of people continued to buy stock in Fannie Mae and Freddy Mac only to loose millions later on. Lifestyle personality Martha Stewart following a tip from her broker sold her IMClone stock to avoid a loss was found guilty in March 2004 of conspiracy, obstruction of an agency proceeding, and making false statements to federal investigators and sentenced in July 2004 to serve a five month term in a federal correctional facility and a two year period of supervised release. Christopher Dodd who misled thousands ran for President of the United States.

Congressman Barney Frank (D-MA) of Massachusetts, chairman of the House Financial Services Committee, a recipient of more than $40,000 in campaign donations from Fannie Mae since 1989 was once romantically involved with a Fannie Mae executive Herb Roses. For the last two years Frank has overseen both Fannie May and Freddy Mac and has continually derailed efforts to regulate both institutions. On July 14th, 2008 Frank stated that “both agencies were fundamentally sound and are not in danger of going under, they are not the best investments these days from the long term standpoint coming back, I think they’re in good shape going forward. There prospects going forward are very solid and in fact we’re going to do some things to improve them”. His statements echoed Christopher Dodd (D-CT) as almost in a sense of conspiracy. Again thousands of people continued to buy stock in Fannie Mae and Freddy Mac only to loose millions later on. Still today Frank does not admit saying what he said or fails to take any blame for the demise of the two agencies he managed.

Christopher Cox, chairman of the Securities and Exchange Commission eliminated a rule last year that had served to keep in check hedge funds and others from destroying companies by selling their shares short. To define short selling: Short-sellers borrow shares of stock from pension funds and brokerage houses and sell them on the open market with the expectation that the stock will drop in value and they can buy them back cheaper, making a profit. Short-selling provides liquidly to the system by bringing more shares to the marketplace and by permitting small and large investors to hedge their portfolios. George Gombossy of the Hartford Current stated “The system worked fairly well until Cox decided to interfere with it. The only time a short sale could take place was when the stock had a trade higher than the one just prior. It acted like a governor, keeping order, preventing wounded companies from being eaten alive by the shorts. When the SEC removed the uptick rule it was like giving assault weapons to hunters and letting them loose in a zoo. During the last few months, hedge funds and other speculators and investors attacked, perhaps working together, wounded banks and financial institutions without mercy, almost bankrupting all of these companies. There is widespread belief that rumors were started by some speculators who sold shares short and then bought them back right before the rumors were debunked. It was only in the last couple of weeks that the SEC stopped all short sales on about 20 major financial institutions, but it was too late”. Cox went 180 degrees in the other direction and ordered a temporary and complete halt to all short sales on 799 financial companies. Investors will still be able to purchase exchange traded funds that short market sectors, including those that have financial institutions in their portfolios. Less than 24 hours later, the order had to be amended because Cox failed to realize that traders at exchanges could not operate without being able to short stocks. Cox needs to be replaced with someone who knows how the stock market operates.

Henry Paulson, U.S. Treasury Secretary called for a $700 billion dollar recovery plan, with no guarantee of success, passed both houses and was signed by President Bush. Some have suggested Paulson's bailout plan may potentially have some conflicts of interest since Paulson is the former CEO of Goldman Sachs, a firm that may benefit from the plan. Paulson appointed a former Goldman Sachs executive, Neel Kashkari to head the Treasury's new Office of Financial Stability or simply put, to manage the $700 billion, a blatant example of cronyism. Thank goodness former Senior Partner Governor Jon Corzine (D-NJ) wasn't selected. He never got along with Henry Paulson but took him for $400 million dollars when he left Sachs. Corzine went off to destroy New Jersey.

During the October 7th 2008 debate, John McCain (R-AZ) after taking a stand against massive government spending contradicted himself by committing to a government buyout that will cost at least $300 billion dollars, a government massive spend. The proposal involves directing the Treasury Secretary to purchase mortgages directly from homeowners and mortgage servicers. Surprised….The House passed this bill back on July 26th 2008 called the Housing and Economic Recovery Act of 2008.

AIG received an $85 billion dollar rescue from the Federal Government. Joseph Cassano, the financial products manager whose complex investments led to American International Group's near collapse, is receiving $1 million a month in consulting fees. Former chief executive Martin J. Sullivan, whose three-year tenure coincided with much of the company's ill-fated risk-taking, is receiving a $5 million performance bonus. Seventy of the company's top performers were rewarded with a week-long stay at the luxury St. Regis Resort in Monarch Beach, Calif., where they ran up a tab of $440,000. This just in... The New York Federal Reserve will lend them $37.8 billion dollars in addition to the $85 billion. I guess the spa must have raised their prices.

Barack Obama (D-IL) is listed as 2nd highest on the list of Recipients of Fannie Mae and Freddie Mac Campaign Contributions, receiving $126,349, Harry Reid (D-NV) is 11th on the list receiving $77,000 dollars, Hillary Clinton (D-NY) is 12th receiving $76,050, Nancy Pelosi (D-CA) is 18th receiving $56,250, Barney Frank (D-MA) is 26th receiving $42,350 and John McCain (D-AZ) is 62nd collected a mere $21,550. John McCain did call for the regulation of Freddy Mac and Fannie Mae and co-sponsored the Federal Housing Enterprise Regulatory act of 2005 submitted for the record back on May 26th 2006. Click link.
http://mccain.senate.gov/public/index.cfm?FuseAction=PressOffice.PressReleases&ContentRecord_id=C97D478F-F460-4253-B2EC-8D9FBCAFF20C

There are some thinkers in Congress who do care about us: Representatives Marcy Kaptur (D-OH), Peter DeFazio (D-OR), Rush Holt (D-NJ) proposed an alternative measure, the “No Bailouts Act”, to address the financial situation without bailing out Wall Street and corporate executives. "We want a good bill, not a fast bill. We want a bill that will really work," said Kaptur, the senior-most woman in the House. Click link.
http://www.kaptur.house.gov/index.php?option=com_content&task=view&id=297&Itemid=1

Unfortunately, the only legislators who are around to listen to Kaptur and her crew are too busy working those tough Pro Forma sessions.

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