Monday, May 18, 2009

What we got is not what we saw during the Obama campaign, its worse

The Obama administration continues to confirm almost daily the worst; that the president won’t rest during his first administration until his plans to change our country into a replica of a socialist state are complete.

First huge sums of money were authorized for the purpose of dealing with toxic mortgages and then the administration henchmen changed the rules and used the money to extend government control over the banking industry going so far as to dictate executive compensation. Then Obama worked with the Democrat-dominated congress and renegade Republicans to pass a so-called Stimulus Bill that gives billions to organizations supporting Obama, some nefariously, and which does little or nothing to stimulate the economy or increase employment. After these successes Obama got the Congress to approve the largest budget, and accompanying deficit, in the history of the country all the while proclaiming that “Bush made me do it.” Additional government takeovers are in the works and are also likely to become law – like “cap and trade” and government “healthcare for everyone.”

Now if all this isn’t bad enough Obama flexes government muscles in another way. The Obama administration has been forced to release documents by Judicial Watch which shows that on October 13, 2008, the Treasury Department had a meeting with major banks where they were coerced into allowing the government to take $250 billion in equity ownership. The documents released also confirm former Treasury Secretary Hank Paulson told the CEOs of nine major banks that they had no choice but to allow the government to take equity stakes in their institutions. The documents reveal that Obama Treasury Secretary Tim Geithner, FDIC Chairman Shelia Blair and Fed Chairman Ben Bernanke co-hosted the meeting with Paulson.

The CEOs present at the October 13 meeting were Vikram Pandit of Citigroup, Jamie Dimon of JP Morgan, Richard Kovacevich of Wells Fargo, John Thain of Merrill Lynch, John Mack of Morgan Stanley, Lloyd Blankfein of Goldman Sachs, Robert Kelly of Bank of New York and Ronald Logue of State Street Bank.

After months of government stonewalling, Judicial Watch filed a Freedom of Information Act (FOIA) request for information about the October 13, 2008 meeting with bankers. The Judicial Watch lawsuit was filed against the Obama Treasury Department on January 27, 2009. Incredibly, on February 4, 2009, Treasury responded it had no documents about the coercion meeting but continued pressure from Judicial Watch forced Treasury to reevaluate its response, which resulted in this document release. Included in the released documents are:

1. "CEO Talking Points" used by former Treasury Secretary Hank Paulson confirming that the nine bank CEOs present at the October 13 meeting had no choice but to accede to the government's demands for equity stakes and the resulting government control. The talking points emphasize that "if a capital infusion is not appealing, you should be aware your regulator will require it in any circumstance." Suggested edits of the "talking points" by Tim Geithner, then-New York Fed President, were withheld by the Obama Treasury Department.

2. "Major Financial Institution Participation Commitments" signed by the nine bankers on October 13. The CEOs not only hand wrote their institution's names but also hand wrote multi-billion dollar amounts of (convertible) "preferred shares" to be issued to the government.

3. E-mail documenting that, on the very day of the meeting, the Chief of Staff to the Treasury Secretary and other top Treasury staff did not know the names of any of the banks that would be in attendance. E-mail showing Treasury officials wanted to use the Secret Service to help keep the press away from the CEOs arriving at the meeting. E-mail showing a public relations effort, initially run by the Bush White House and then taken over by the Obama administration, to calm down public concerns about "nationalizing the banks." E-mail that showed Paulson was able to brief President Obama about the bankers meeting almost immediately, but could not reach Senator John McCain. The government skullduggery evident at this meeting is the kind that Putin's Russia or Chavez's Venezuela would use. This government control began during the Bush presidency but has metastasized like cancer under the Obama administration – giving Obama effective control of not only these major banks but the domestic auto industry as became evident a bit later.

Not bad for just a few months work wouldn’t you say? But, the worst is yet to come; there is no limit to the harm Obama will do with a Democrat-controlled legislature and a compliant Republican minority.

1 comment:

Lorraine said...


It was a pleasure meeting you last night. I appreciate your blog and agree with your sentiments. Those of us who do not wish to see this country transformed must be vocal and we must be loud. I applaud your efforts. I'm so appreciative of the fine minds in our Prager group. Hope to see you next month.