‘Occupiers’ want to recover the United States from the clutches of the very wealthy
The rapidly growing Occupy Wall Street movement has expanded to more than 100 U.S. cities and is becoming a worldwide protest. Yet the media keep raising the question, “What do these people really want?” The answer should be pretty obvious. They want to recover our country from the excessive greed of the extremely wealthy, the stranglehold their wealth gives them over our government and our economy, and their total disregard for the interests and well-being of the vast majority of Americans. The Occupiers’ battle cry could well be, “We’re mad as hell, and we’re not going to take it any more!”But first, a little history. In the late 1920s, millions tried to get rich quickly by jumping into the booming stock market. When the bubble burst, it took everyone with it, including even those who had not taken part in the excesses that led to the implosion of the market. But the resulting collapse of the entire economy took both their jobs and their savings with it. Thousands of banks, both large and small, which had been playing the market were closed, and peoples’ savings were gone.It was obvious to Congress that regulation was needed to curb the excesses of greed that had caused the stock market collapse and the resulting Depression, and protect the public. The 1933 Glass-Seagal Act prohibited banks from engaging in both savings and loan activities and investment activities, and set up the Federal Deposit Insurance Corp. to protect people’s savings.These measures worked very well for nearly 70 years (with the exception of the 1989 savings and loan debacle). But the speculators were getting restless, claiming the Glass-Seagal regulations were hurting business by cramping their style. So in 1999, a Republican Congress repealed the provision prohibiting banks from engaging in both savings and investment activities. With virtually no oversight over their activities, Wall Street bankers were free to dream up “creative” ways by which to amass ill-gotten fortunes by what was virtually a Ponzi scheme.”Sub-prime” and adjustable-rate mortgages were issued by the millions, largely to people the banks knew would not be able to afford them. The issuing banks didn’t care because they were selling the mortgages to big banks at a handsome profit. The big banks then bundled the mortgages into Collateral Debt Obligations, got these risky CDOs rated AAA by Moody and Standard & Poor, and peddled them to unsuspecting buyers, including pension funds and endowments. Then along comes AIG, which the big banks convinced to issue Credit Default Swaps, which were insurance policies protecting those with inside knowledge that the CDOs were shaky against their default. But unlike any other insurance, you did not have to own any of the CDOs, nor did AIG have to set aside any reserves to cover the risk of the swaps it was issuing. Goldman-Sachs and others buying these swaps were, in effect, betting against the CDOs they were selling to their clients. And AIG issued trillions of dollars of these swaps. In 2008, the whole house of cards came crashing down. The Bush administration, with Henry Paulson, former president of Goldman-Sachs, as treasury secretary, bailed out the “too-big-to-fail” financial institutions with $182 billion for AIG, a large portion of which went to Goldman Sachs, and $100 billion in TARP (Troubled Asset Relief Program), some of which also went to Goldman-Sachs. The end result was that these programs allowed Goldman-Sachs to recoup 100 percent of its losses, enabling it to pay out bonuses in 2009 totaling $1.2 billion.While those at the top were making a killing off their schemes, the economy tanked and took the rest of the country with it. Millions lost their jobs, and with that loss of income, also lost their homes. American families saw their assets shrink by $14 trillion, taking away money for their children’s education and their retirement plans. But none of those whose criminal activity was responsible for the hardships being suffered by so many have been brought to justice. Instead, they are busy selling their Congress the myth that any regulation of the financial industry would be bad for business, and that they should not be restricted from continuing to profit from the very practices that got our country into the mess we are stuck in. So what is the big mystery about the mission of the Occupiers? Fighting this plague of excessive greed should be our mission also.”As I See It” appears on the first and third Thursdays of the month. Hal Sundin lives in Glenwood Springs and is a retired environmental and structural engineer. Contact him at firstname.lastname@example.org.
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