PadminiArhant.com
SEC Lawsuit against Goldman Sachs – Perspective
April 19, 2010
By Padmini Arhant
All the reports on Goldman Sachs from various credible sources confirm the fact that,
There is more to it than meets the eye.
SEC investigation must go underneath the surface.
For Goldman Sachs – it’s analogous to “make a mountain out of molehill.”
When in fact, it’s an erupting volcano that has already claimed many lives and threatening more in the present.
Wikipedia Report – Goldman Sachs Controversies: Thank you.
“Robert Freeman, who was a senior Partner, who was the Head of Risk Arbitrage, and who was a protégé of Robert Rubin, was also convicted of insider trading, for his own account and for the firm’s account.”
Per the above report on “Goldman Sachs’ Controversies,” juxtaposed to NYT article on the Obama administration’s economic team,
The New York Times report – By Jackie Calmes – Published: Monday November 24, 2008 – Thank you.
“The president-elect used the announcement Monday that he was appointing two Rubin protégés, Timothy Geithner as Treasury secretary and Lawrence Summers as senior White House economic adviser, to underscore his determination to step aggressively into a economic leadership vacuum in Washington while also maintaining continuity with the Bush administration before the transition of power Jan. 20.
Obama is expected to soon announce the appointment of another Rubin protégé, Peter Orszag, as White House budget director.
And even the headhunters for Obama have Rubin ties: Michael Froman, who was Rubin’s chief of staff in the Treasury Department and followed him to Citigroup, and James Rubin, Robert Rubin’s son.
Geithner, Summers and Orszag have all been followers of the economic formula that came to be called Rubinomics: balanced budgets, free trade and financial deregulation.
On Wall Street, Rubin is facing questions about his role as director of Citigroup, given the bank’s current troubles, and,
During the weekend held several discussions with Treasury Secretary Henry Paulson as a government rescue of Citigroup was organized.”
“What worries me is there is not one person in the senior group who is the outsider to this club.
And that’s particularly ironic, given Barack Obama’s bias toward copying Lincoln’s ‘team of rivals,”‘ said Robert Kuttner, a colleague of Bernstein’s at the liberal Economic Policy Institute who has written a book, “Obama’s Challenge,” on free-spending, pro-regulatory approaches to the economic crisis.
“Where is the diversity of opinion in this economic team?” he said.”
————————————————————————————————–
Perspective – By Padmini Arhant
The establishment’s control of the economic power in the Executive branch is noteworthy.
Whether it was the former Goldman Sachs CEO and Treasury Secretary Henry Paulson serving the previous Bush-Cheney administration,
Or,
The Obama administration’s economic team identified as “Robert Rubin’s” protégés,
The trend continues with the economic management by those responsible for the economic crisis.
Is it an irony or the undermining of democracy with “business as usual” concept prevailing in any administration.
Goldman Sachs investigation is just the tip of the iceberg.
Rigorous investigation and appropriate action is warranted to resurrect the financial market and the Wall Street credibility.
Goldman Sachs’ dealings in diverse portfolio and the recent performance beckons scrutiny considering the ramifications experienced in the domestic and international financial markets.
Prime examples are Greece and the U.S.economy.
Several European banks reported to have lost money in the deceptive deal.
SEC cannot be complacent with the preliminary finding.
Therefore, it’s incumbent upon SEC to proceed with further investigations against Goldman Sachs to deliver justice to the victims and protect the system from systemic abuse.
The U.S and the global economy cannot sustain history repeating itself.
Thank you.
Padmini Arhant
SEC Lawsuit against Goldman Sachs
April 18, 2010
By Padmini Arhant
The Securities and Exchange Commission filed lawsuit against Goldman Sachs on the toxic derivatives camouflaged with the internationally renowned investment firm, authenticating the risky mortgage securities sold to trusting investors in the domestic and global financial market.
Goldman Sachs is engaged in Investment Banking, Trading and Principal Investments, and Asset Management and Securities Services.
Needless to state that sub-prime mortgage is synonymous to the ‘speed boat’ designed for a fatal crash due to the deliberate sabotage. Sure enough, it had a negative impact on the financial and housing market that contributed to a precipitous economic decline worldwide.
The savvy designers protected their own investment with ‘insurance’ on the ‘abyss’ through yet another global conglomerate ‘AIG,’ technically partners in the ingenious profit oriented craft.
Why?
Because, the insurance companies grill the ‘regular folks’ when applying for any insurance to minimize risk exposure.
Even the trivial finding in the applicant’s background is used as the grounds for rejection or the cause for high premium – e.g. the health insurance industry.
It’s noteworthy that both Goldman Sachs and AIG were swiftly bailed out with taxpayers’ funds on the “Too Big to fail,” concept.
As a result, the fire starters were salvaged by the taxpayers.
The fire sale was organized for the Treasury to buy the damaged goods at the taxpayers’ expense from the banks on the brink of collapse.
————————————————————————————-
Goldman Sachs reportedly,
Wikipedia.org – Thank you.
“Goldman also received $10 billion preferred stock investment from the U.S. Treasury in October 2008, as part of the Troubled Asset Relief Program (TARP).
In June 2009, Goldman Sachs repaid the U.S. Treasury’s TARP investment, with 23% interest (in the form of $318 million in preferred dividend payments and $1.418 billion in warrant redemptions).
New York Attorney General Andrew Cuomo questioned Goldman’s decision to pay 1556 employees bonuses of at least $1 million after it received TARP funds in 2008.
In December 2009, Goldman announced their top 30 executives will be paid year-end bonuses in restricted stock, with clawback provisions, that must go unsold for five years.”
It’s essential to emphasize that Goldman Sachs is not new to controversy.
——————————————————————————————-
Source: Wikipedia.org – Thank you.
Controversies
In 1986, David Brown was convicted of passing inside information to Ivan Boesky on a takeover deal.
Robert Freeman, who was a senior Partner, who was the Head of Risk Arbitrage, and,
Who was a protégé of Robert Rubin, was also convicted of insider trading, for his own account and for the firm’s account.
On November 11, 2008, the Los Angeles Times reported that Goldman Sachs, which earned $25M from underwriting California bonds, had advised other clients to “short” those bonds.
Shorting is essentially betting that the state will default on the bonds, which serves to drive up the cost of the issue to the state.
During 2008 Goldman Sachs came under criticism for an apparent revolving-door relationship in which its employees and consultants have moved in and out of high level US Government positions, where there may exist the potential for a conflict of interest.
Former Treasury Secretary Hank Paulson was a former CEO of Goldman Sachs.
Additional controversy attended the selection of former Goldman Sachs lobbyist Mark Patterson as chief of staff to Treasury Secretary Geithner, despite President Barack Obama’s campaign promise that he would limit the influence of lobbyists in his administration.
During 2010, Goldman Sachs has been accused for its involvement in the 2010 European sovereign debt crisis.
Goldman Sachs between the years 1998-2009 has been reported to systematically helped the Greek government to mask its national true debt facts.
In September 2009 though, Goldman Sachs among others, created a special Credit Default Swap (CDS) index for the cover of high risk national debt of Greece.[66] This led the interest-rates of Greek national bonds to a very high level, leading the Greek economy very close to bankruptcy in March 2010.”
———————————————————————————————-
Actions in the 2007–2008 subprime mortgage crisis:
Despite the 2007 subprime mortgage crisis, Goldman was able to profit from the collapse in subprime mortgage bonds in the summer of 2007 by selling subprime mortgage-backed securities short.
Two Goldman traders, Michael Swenson and Josh Birnbaum, are credited with bearing responsibility for the firm’s large profits during America’s sub-prime mortgage crisis.
The pair, who are part of Goldman’s structured products group in New York, made a profit of $4 billion by “betting” on a collapse in the sub-prime market, and shorting mortgage-related securities.
By summer of 2007, they persuaded colleagues to see their point of view and talked around skeptical risk management executives.
The firm initially avoided large subprime writedowns, and achieved a net profit due to significant losses on non-prime securitized loans being offset by gains on short mortgage positions.
Its sizable profits made during the initial subprime mortgage crisis led the New York Times to proclaim that Goldman Sachs is without peer in the world of finances.
The firm’s viability was later called into question as the crisis intensified in September 2008.
Allan Sloane of Forbes, a financial writer of reputation, wrote a referenced article on 15 October 2007, at the time the crisis had begun to unravel.
It appeared on CNN’s website: “So let’s reduce this macro story to human scale.
Meet GSAMP Trust 2006-S3, a $494 million drop in the junk-mortgage bucket, part of the more than half-a-trillion dollars of mortgage-backed securities issued last year.
We found this issue by asking mortgage mavens to pick the worst deal they knew of that had been floated by a top-tier firm – and this one’s pretty bad.
“It was sold by Goldman Sachs (Charts, Fortune 500) – GSAMP originally stood for Goldman Sachs Alternative Mortgage Products but now has become a name itself, like AT&T and 3M.
“This issue, which is backed by ultra-risky second-mortgage loans, contains all the elements that facilitated the housing bubble and bust.
It’s got speculators searching for quick gains in hot housing markets;
It’s got loans that seem to have been made with little or no serious analysis by lenders; and finally,
It’s got Wall Street, which churned out mortgage “product” because buyers wanted it.
As they say on the Street, ‘When the ducks quack, feed them.'”
Weeks of chaos that sent Lehman Brothers into bankruptcy and led to the rushed sale of Merrill Lynch & Co. to Bank of America Corp.
According to a 2009 Brand Asset Valuator survey taken of 17,000 people nationwide, the firm’s reputation suffered in 2008 and 2009, and rival Morgan Stanley was respected more than Goldman Sachs, a reversal of the sentiment in 2006.
Goldman refused to comment on the findings.
—————————————————————————————
2. According to http://www.wsws.org/articles/2008/sep2008/paul-s23.shtml – Thank you.
Published by the International Committee of the Fourth International (ICFI)
Who is Henry Paulson?
By Tom Eley, 23 September 2008
Henry Paulson rose through the ranks of Goldman Sachs, becoming a partner in 1982, co-head of investment banking in 1990, chief operating officer in 1994.
In 1998, he forced out his co-chairman Jon Corzine “in what amounted to a coup,” according to New York Times economics correspondent Floyd Norris, and took over the post of CEO.
Goldman Sachs is perhaps the single best-connected Wall Street firm.
Its executives routinely go in and out of top government posts.
Corzine went on to become US senator from New Jersey and is now the state’s governor.
Corzine’s predecessor, Stephen Friedman, served in the Bush administration as assistant to the president for economic policy and as chairman of the National Economic Council (NEC).
Friedman’s predecessor as Goldman Sachs CEO, Robert Rubin, served as chairman of the NEC and later treasury secretary under Bill Clinton.
Agence France Press, in a 2006 article on Paulson’s appointment,
“Has Goldman Sachs Taken Over the Bush Administration?” noted that, in addition to Paulson,
“[t]he president’s chief of staff, Josh Bolten, and the chairman of the Commodity Futures Trading Commission, Jeffery Reuben, are Goldman alumni.”
Prior to being selected as treasury secretary, Paulson was a major individual campaign contributor to Republican candidates, giving over $336,000 of his own money between 1998 and 2006.
Since taking office, Paulson has overseen the destruction of three of Goldman Sachs’ rivals.
In March, Paulson helped arrange the fire sale of Bear Stearns to JPMorgan Chase.
Then, a little more than a week ago, he allowed Lehman Brothers to collapse,
While simultaneously organizing the absorption of Merrill Lynch by Bank of America.
This left only Goldman Sachs and Morgan Stanley as major investment banks,
Both of which were converted on Sunday into bank holding companies, a move that effectively ended the existence of the investment bank as a distinct economic form.
Paulson bears a considerable amount of personal responsibility for the crisis.
Paulson, according to a celebratory 2006 Business Week article entitled –
“Mr. Risk Goes to Washington,” was “one of the key architects of a more daring Wall Street, where securities firms are taking greater and greater chances in their pursuit of profits.”
Under Paulson’s watch, that meant “taking on more debt: $100 billion in long-term debt in 2005, compared with about $20 billion in 1999.
It means placing big bets on all sorts of exotic derivatives and other securities.”
According to the International Herald Tribune,
Paulson “was one of the first Wall Street leaders to recognize how drastically investment banks could enhance their profitability by betting with their own capital instead of acting as mere intermediaries.”
Paulson “stubbornly assert[ed] Goldman’s right to invest in, advise on and finance deals, regardless of potential conflicts.”
Paulson then handsomely benefited from the speculative boom.
This wealth was based on financial manipulation and did nothing to create real value in the economy.
On the contrary, the extraordinary enrichment of individuals like Paulson was the corollary to:
The dismantling of the real economy,
The bankrupting of the government and,
The impoverishment of masses the world over.
Paulson was compensated to the tune of $30 million in 2004 and took home $37 million in 2005.
In his career at Goldman Sachs he built up a personal net worth of over $700 million, according to estimates.
——————————————————————————————–
3. By Jackie Calmes – Published: Monday, November 24, 2008 – Thank you.
Obama’s economic team shows influence of Robert Rubin – with a difference
WASHINGTON — It is testament to the star power of former Treasury Secretary Robert Rubin among many Democrats that as Barack Obama fills out his economic team, a virtual Rubin constellation is taking shape.
The president-elect used the announcement Monday that he was appointing two Rubin protégés,
Timothy Geithner as Treasury secretary and Lawrence Summers as senior White House economic adviser,
To underscore his determination to step aggressively into a economic leadership vacuum in Washington while also maintaining continuity with the Bush administration before the transition of power Jan. 20.
Obama is expected to soon announce the appointment of another Rubin protégé, Peter Orszag, as White House budget director.
And even the headhunters for Obama have Rubin ties: Michael Froman, who was Rubin’s chief of staff in the Treasury Department and followed him to Citigroup, and James Rubin, Robert Rubin’s son.
Geithner, Summers and Orszag have all been followers of the economic formula that came to be called Rubinomics: balanced budgets, free trade and financial deregulation.
The combination was credited with fueling the prosperity of the 1990s.
But times have changed since then.
On Wall Street, Rubin is facing questions about his role as director of Citigroup, given the bank’s current troubles, and during the weekend held several discussions with Treasury Secretary Henry Paulson as a government rescue of Citigroup was organized.”
“What worries me is there is not one person in the senior group who is the outsider to this club.
And that’s particularly ironic, given Barack Obama’s bias toward copying Lincoln’s ‘team of rivals,”‘ said Robert Kuttner, a colleague of Bernstein’s at the liberal Economic Policy Institute who has written a book, “Obama’s Challenge,” on free-spending, pro-regulatory approaches to the economic crisis.
“Where is the diversity of opinion in this economic team?” he said.
————————————————————————————————–
Thank you.
Padmini Arhant
Financial Reform with an Independent Consumer Protection Agency
March 6, 2010
By Padmini Arhant
The Wall Street bailout season commenced in 2008 and continued into 2009. Those corporations allied with the oligarchs not only survived but their CEO’s are thriving amid difficult economic times and some states experiencing a double-digit unemployment.
As stated earlier in numerous articles on the economy and the financial sector, the speculators’ reckless conduct together with greed led to the status quo. The sub-prime mortgage and credit card lending practices targeting the vulnerable population contributed to the housing market decline and the alarming bankruptcies.
In addition, the credit crunch has forced many small businesses to lay off employees and left the self-employed in a dire situation. The private sector have also been affected in the liquidity crisis triggering the 9.7 percent national unemployment rate and much higher when consolidated with the under employed statistics.
Evidently, a rigorous financial reform is necessary to revive the economy and avert future meltdown.
Although, an international consensus was reached during the G-20 meetings in 2009 at London and Pittsburgh to implement strong financial regulations, the domestic agenda in the United States is faltering due to the usual Senate gridlock and the lack of enthusiasm to push the issue forward.
However, the House of Congress is way ahead of Senate in passing legislations on many issues, reflecting the Speaker Nancy Pelosi and the House of Representatives’ commitment.
On the other hand, the Senate majority leader Harry Reid has a tough battle convincing the opposition, sworn to filibuster the legislations on any reform.
The Republican Senators and the democrat opponents believe in the market economy free of regulations and refuse to acknowledge the economic adversity brought upon by deregulations in the recent decades.
Failure to act now would be catastrophic for the global financial market and the economy.
There is no guarantee that the U.S economy and the rest of the world would not be subject to a similar scenario in the future with the hedge fund managers and the investment banks such as the Goldman Sachs…
Having set a precedence in wild speculations, high-risk exposure and fast track profiteering at the expense of millions of borrowers, investors and national economies like P.I.G.S, an acronym for Portugal, Iceland/Ireland, Greece and Spain, all of whom are currently dealing with insolvency.
Finance sector being the cradle of the economy, the benign symptoms would prompt the government bailouts of the default institutions. Thus, history repeating itself with the exponentially rising national debt remaining the constant factor in the non-regulatory environment.
Another attention worthy issue in this context is the establishment of an Independent Consumer Protection Agency.
Agency’s function would be fairly common and that being,
Protecting the consumer rights as the borrowers,
Creating awareness on the industry’s unethical practices apart from,
Preventing the banks in the systemic abuse of customers through inflated finance charges and interest rates on personal loans, credit card etc.
Further, it could also provide arbitration service to the borrower and the lender on financial disputes, thereby mitigating legal expenses for both parties.
Not surprisingly, there is resistance to the Independent Consumer Protection Agency.
As witnessed in the health care bill, the lobbyists are relentlessly engaged in ensuring the demise of the financial reform and the consumer protection agency.
The White House being suggested to nominate the Treasury Department in handling the Consumer Protection Agency affairs as opposed to a non-partisan and an independent committee, poses a conflict of interest stemming from the Treasury Department’s liaison with the financial institutions.
Likewise, the Federal Reserve maintaining control over the Consumer Protection Agency against the banking sector is an unrealistic expectation based on the Federal Reserve’s performance in the sub-prime mortgage debacle and the executives’ close ties with the finance sector.
Therefore, the consumer protection agency ought to be independent and focused on safeguarding consumer interest.
Financial reform cannot be delayed or relinquished especially with the Wall Street’s compulsive disorder to indulge in short term gains by acquiring toxic assets only to be transformed into a burgeoning liability.
Alternatively, the watered down legislation could fulfill a formality and not serve the purpose.
Hence, the requirement for a meaningful financial reform is absolutely vital to rein in on predatory traditions.
Finally, the U.S. economic recovery could be expedited through a robust financial regulation that would instantaneously restore the investor and consumer confidence.
Thank you.
Padmini Arhant
President Obama’s $3.83 trillion Fiscal Budget
February 3, 2010
By Padmini Arhant
President Barack Obama unveiled his 10-year macro budget with various economic commitments.
2011 Fiscal Budget is projected with the total revenue $2.56 trillion and total spending @ $3.83 trillion leaving a deficit @$1.27trillion.
According to the impressive layout from the article:
Budget outlook: Budget deficits Published By Jackie Calmes – New York Times and,
Presented by San Jose Mercury News – February 2, 2010 – Thank you.
Targeted Revenues – $2.56 trillion
Individual Income Taxes – $1.12 trillion predominantly derived by ending the extravagant tax cuts allowed to wealthy individuals during the prior administration rule for e.g. the couples making over $250,000 and individuals earning above $200,000.
Corporate Income Taxes – Tax increase on wealthy corporations – Expected income – $270Billion
Social Security and Payroll taxes – $935 billion
Excise taxes – $74 billion
Custom duties – $27 billion
Estate and gift taxes – $25 billion
Other $87 billion
————————————————————————————————–
Budget Spending – $3.83 trillion
Mandatory Spending:
Interest on debt $251 billion
Other – $ 648 billion
Medicaid – $297 billion
Medicare – $491 billion
Social Security – $730 billion
Discretionary Spending:
Defense – $895 billion
Other – $520 billion
——————————————————————————————
Views and Analysis: By Padmini Arhant
The budget’s focus on two most important factors unemployment and the lack luster consumer spending, responsible for slow economic recovery – is a major step in reviving the sluggish economy.
Unemployment addressed by providing $100 billion to boost the small businesses, medium corporations, middle class, social safety net programs, aid to state and local governments and expanding federal student loan program to enable the Pell grants for easy eligibility would remarkably tackle the national double-digit jobless figures.
Since President Obama pledged to reverse the trend by converting the U.S. market, presently a supersize importer to a profit-oriented exporter, the details on the manufacturing sector are missing.
Manufacturing being deeply hurt in the economy with jobs shipped to China, the blue-collar workers in this area require massive attention as the others in the construction industry. Unless there is a provision already made in the $100 billion fund.
The budget provides further economic stimulus through tax credits to average income families –
$400 for individuals and $800 on combined income including tax cuts for workers and other businesses through 2011 – An enormous supplement towards consumer spending and job creation.
Tax cuts to big businesses should be conditional upon preservation and creation of jobs in the national economy.
Federal aid to state and local governments should contribute to the national GDP considering the severe state budget crisis that has directly affected the public services such as education, health and environment suffering serious job losses from the state spending cuts.
Soaring annual deficit expected to be $1.6 trillion for 2010 due to burgeoning economic crisis dropping to $1.3 trillion in 2011 and, then onwards remaining high based on the rising health care costs and retirement programs for the baby-boom population.
The President’s effort in this regard should mitigate the deficit largely through proposed strategies
and they are –
Slashing funding for numerous redundant programs and freezing discretionary spending for three years.
Raising fees, taxes on banks and the wealthy.
According to the reports, the President approach towards a comprehensive deficit-reduction plan is to set up a bi-partisan commission represented by the lawmakers from both political parties and budget experts. Their task is to involve a package consisting tax increases and spending cuts to slash deficits as well as stabilize government borrowing by 2015.
Although, the Republican lawmakers had initially agreed to the measure, they later defeated the President’s bi-partisan commission plan and retracted from their position confirming the Republican members’ traditional partisanship towards the democrat President.
Despite the setback, the President’s decision to move forward in this regard is wise and the American electorate must remember the Republican members’ refusal to cooperate for the national interest, i.e. alleviating the national debt burden on their children, in the 2010 elections.
Criticisms against the President’s position on Medicare and Medicaid as the entitlement programs and tax revenues not adjusted against the annual deficit reduction by paying down an accumulated debt do not serve the economic viability, but only offer sound bites in the political discussion.
Again, deficit reduction is paramount and it should not happen at the cost of the vulnerable population – the senior citizens and the poorer families who are otherwise the consumer taxpayers.
In terms of paying down the national debt, it could be adjusted from the inevitable economic growth through vast investment in job creation and consumer spending.
Bi-partisan consensus on the economic revival as the immediate priority is oxymoron, if the administration is not allowed to expedite the process through aggressive policies combined with direct interjection of funds into the revenue sectors.
War spending in the amount of additional $33 billion and a total budget $160 billion for the two simultaneous wars in Iraq and Afghanistan is an area that could be drastically modified with a concrete exit strategy from both territories in the near future.
Iraq troop withdrawal this summer has been committed by the President and the savings from it could be utilized in paying back the national debt as it would result in the return savings via interest payment contraction on the borrowings.
Passing the health care legislation with a government insurance program should unequivocally cut the health care costs and decrease the deficit because of the widely acknowledged health care expenditure draining the present economy. Even more reason to introduce the public option in the legislation to minimize the projected escalation in health care spending cited above.
Other areas aimed at reducing national deficit are the cutting and eliminating minor domestic programs and major military equipments.
Raising taxes on big banks and oil companies is an effective means to earn income and a long overdue transformation from the Bush-Cheney era.
The White House being optimistic in cutting the inherited deficit in half by 2013to slightly over 4 percent of the GDP juxtaposed to the projected $1.3 trillion deficit exceeding 9 percent of the GDP at the dawn of Obama Presidency highlights the stark contrast in economic policies between the two administrations.
Overhauling finance and energy sector in addition to the health industry would yield the desirable outcome in the national debt decline.
Allocating necessary funds towards education, science and research, food and drug safety, NASA space programs innovation and climate change legislation reflect short and long-term aspirations.
Concerns over sustainable deficits in the long run are justified. At the same time, the confidence in the guaranteed economic boom is disappointingly low especially after successful intervention to avert the financial collapse in the year 2009 that stabilized the stock market up until now, apart from dealing with other economic woes.
“Limited long-term solutions in the budget expressed by the skeptics” – They fail to view the entire picture in detail that ensures the economic security throughout the decade and beyond primarily owing to the robust fiscal policy adopted in the budget.
In fact, it’s possible to balance the 2011 budget with a shortfall exacted at $1.27 trillion.
Defense spending $895 billion is blown out of proportions and require trimming.
Discretionary ‘other’ spending $520 billion upon careful review could lead to huge savings.
The combined total for these two expenses are $1.4 trillion that could be easily restrained to below trillion dollars for the prolonged deficit sustainability.
On the revenue side – Corporate Income Taxes estimated @$270 billion is relatively low for the world’s leading industrialized nation with U.S corporations playing a prominent role as the multinationals offshore. Therefore, the Obama administration could close loopholes in the tax evasion through tax haven and extract more income to reduce the deficit.
Foreign Corporations in the United States should be evaluated for their operation in promoting local employment against enhancing economic prospects to their country of origin.
Likewise, in excise taxes and custom duties – the tariff and import duty revision on overseas items could produce additional revenue.
Similarly, updating the estate and gift taxes including the ‘other,’ is an opportunity to extract more income.
President Barack Obama and the administration have prepared the budget diligently. It deserves praise and credit for the broader vision. The economic recommendations are solid while remaining essential.
However, a daunting task is the legislation on national issues such as health care, finance and energy crucial to contain the agonizing deficit. The grueling legislative process is dominant in opposition and weak in positive action.
Therefore, the opposition from both sides of the aisle must work together with the majority in resolving the economic crisis to benefit the people across the political spectrum.
People should coalesce nationally in this respect and help President Obama and Congress in seeking legislation approval on the listed national issues from across the political aisle, particularly free of filibuster threats.
Perhaps, bust the filibuster movement is imminent.
The legislations are urgently needed for instant economic relief.
Finally, the fiscal budget has –
Remedy for the past problems, Solutions to the present challenges and Investment in future goals.
Thank you.
Padmini Arhant
Financial Crisis Inquiry
January 14, 2010
By Padmini Arhant
Today, the financial crisis inquiry commission summoned the financial sector executives to investigate the activities that primarily contributed to the financial market’s downward spiraling and led the economy to the brink of collapse. The inquiry is a step in the right direction to convey a strong message that no one is above the law and democracy cannot be undermined.
Although, the executives are perceptive in self-defense and evading responsibility for the financial meltdown, the fact of the matter is, these financial moguls capitalized on the economic vulnerabilities during the Bush administration. It’s generated from the deregulations and substantial prime rate reduction alluring average citizens with a political slogan that linked patriotism to home ownership.
More concessions were offered by the Bush-Cheney Presidency through massive tax cuts for corporations, financial institutions and the wealthy individuals boosting the investment banks’ portfolio, thereby driving them from equity markets to speculative trading.
It created an enormous capital infusion with investment banks competing with the commercial banks in the absence of Glass Steagall Act. Followed by AIG collaborating in the insurance deals on the credit borrowings invested in derivatives and hedge funds with risky assets as collateral and underlying value further exacerbated the risk management.
When the bubble burst, so did their balance sheets. It went disarray with the majority lead players burdened with toxic assets that transformed into dead weight liabilities in the form of large risk exposure eroding their capital and solvency, consequently relying on the taxpayer bailout to salvage the financial market and the economy.
Apart from the financial institutions, the architects behind the policies since the early nineties are equally responsible for the debacle.
For instance, the former Federal Reserve Chairman Alan Greenspan,
The former treasury secretary Henry Paulson and the current treasury secretary Timothy Geithner,
The present Federal Reserve Chairman Ben Bernanke along with the financial team under the Obama administration represent the convenient exchanges between the Wall Street and Washington through the revolving door of Goldman Sachs, Merrill Lynch, Morgan Stanley and the Lehman Brothers prior to being acquired by Barclays…to name a few.
As found in other national issues such as health care, communication and energy, the prevalent culture between Washington and Wall Street is a huge conflict of interest leaving the average taxpayers and consumers at the mercy of the “corporate owned government” enterprise.
Investigation is necessary to determine the cause of the status quo. However, it’s significant to have the financial sector pledge to revive the credit market through liquidity flow to small businesses and corporations. It would jumpstart the economy, since financing businesses and corporations positively impact the job market. Meanwhile, the manufacturing sector could be resurrected pervasively, producing the desirable drastic unemployment contraction.
Simultaneously, the finance industry is required to stimulate the real estate and construction areas of the economy. Considering the dismal job growth accompanied by the plummeting residential and commercial real estate values due to the sub-prime mortgage fiasco,
The financial institutions should invigorate the financing and refinancing options to homeowners and commercial estate holders by offering reasonable, incentivized programs that would allow the property owners to comply with the payments and retain the values respectively. The viable strategy would ease the burden on the lender and the mortgagee leading to the property value appreciation.
President Obama’s proposal to levy taxes against the financial institutions that have benefited from the taxpayer bailout is right on target. Not surprisingly, the financial industry is resisting the tax, estimated to yield $120 billion in revenue for the ailing economy. Taxpayers from bottom up shared the trillions of dollars finance industry bailout.
Having stabilized the balance sheets from the massive interjection of funds, the institutions are now challenging the government against the tax proposal by warning that any such levies in the form of fees and taxes would be hurting the consumers, claiming that the customer will ultimately bear the charges through bank fee hikes.
Alternatively, the banks are threatening to move jobs overseas upon any tax or fee imposition.
Despite the pre-existing exorbitant fee and charges applied to banking transactions, the banks’ retaliation to tax proposal via potential fee increase or job export is not only outrageous but also audacious.
Financial sector being the economy’s engine, the credit flow across the spectrum is pertinent to the swift economic recovery including the financial market gains.
The financial institutions’ lack of concern for ethics and the excessive greed triggered the financial market crisis ultimately affecting the global economy. Therefore, there is an urgent requirement for aggressive financial reform to prevent history repeating itself in the near future.
Thank you.
Padmini Arhant
The Mighty Deception – Focus on Politics and Economy
January 9, 2010
By Padmini Arhant
January 19, 2010 marks the first anniversary for the Presidency of Barack Obama. The columnist from the leading national news organization chided the right and the left political factions in the article, the excerpts listed below.
“In a world of ideological sniping, Obama can’t win.”
By Richard Cohen, Washington Post, January 5, 2010
“Last month, no American soldiers were killed in Iraq. Last month, the unemployment rate dipped a bit, the stock market ended the year up, the financial system did not crater, Detroit’s Big Three began to get a pulse – and yet a consensus started to form that Barack Obama, who is either responsible for or merely presided over all this good stuff, is a failure.
On the left, the president is being pummeled for health care legislation that does not include a public option and has not dispatched insurance executives to Guantanamo. On the right, he is being pummeled for socializing the economy, establishing death panels and allowing maniacal Nigerians to load their Calvins with boom-boom and fly into peaceful Detroit. It’s a cartoon.
Any way you measure the polls, Obama did not have a good year.
In foreign policy, Obama has sorely disappointed his fans on the left for escalating the war in Afghanistan and on the right for not escalating it enough…
He has not brought peace to the Middle East.
Obama could be a great president. He has already achieved much – possibly saving the country from financial ruin, salvaging the auto industry, getting some sort of health care reform. Possibly, possibly.
Yet, his numbers sink as his achievements rise. He is the Johnny Appleseed of cognitive dissonance, so utterly detached that when he wins it seems to be only for himself. Pollsters measure him but poets have described him.
William Butler Yeats got it down years ago: “The best lack all conviction, while the worst are full of passionate intensity.”
————————————————————————————————–
Perspective: By Padmini Arhant
The author’s hyperbolic characterization of the left position particularly with the dispatching of the insurance executives to Guantanamo and the article concluding with the quotation ‘the worst are full of passionate intensity,’ suggests the print media eternal love fest with any incumbent administration.
As such, democracy is under siege with the legislations merely passed and mostly stalled at the Corporations’ will, aided by their representatives’ inaction in the Senate and the House. It’s further exacerbated with the established print and mainstream media presenting the figures but not the facts thereby joining the elitists against the populists.
Therefore, it’s essential to place things in perspective for a fair analysis.
Iraq war without casualties in the past month is great news. However, the reason behind that is adopting the “left position” to scale down the troop level and make a firm commitment for troop withdrawal, a diametrically opposite decision by the administration on Afghanistan. Despite the reality, the pledge towards peace and non-violence is characterized as “ideological sniping” rather than pragmatic stance.
The dip in the unemployment rate and the rise in stock market are welcome. Nevertheless, the national unemployment and the states’ joblessness is still in double digit with the middle class dropping to the poorer category and the poor driven to being food stamps dependents.
Stock market performance is directly related to the real and projected industry earnings. Since, the health care reform unarguably in favor of the health care industry in the absence of robust competition such as the government insurance program, the health industry stocks skyrocketed at the confirmation of the public option eliminated from the debate.
In other areas, the defense stocks always thrive rain or shine with the U.S perpetual engagement in warfare. The exception to the genuine growth is the technology sector boosting the figures and again with the drastic employment cuts to survive global competition.
It’s indeed a relief that the financial sector did not crater with the infusion of trillion dollars that has surely benefited the Wall Street more than the main street still being defrauded with no aggressive financial regulations in sight including the oversight demanding accountability on the massive taxpayer bailouts.
Detroit’s big three began to get a pulse – yet the State of Michigan ranks the highest in unemployment rate with an average 15.8 percent described as the worst annual rate in “at least 40 years,” and disproportionately greater among the African American as well as other minority groups.
It’s true that the Obama presidency salvaged the financial and auto industry from ruin and currently involved in the health care reform. Although, the salvation of these sectors were carried out to protect jobs, stimulate the economy by unleashing the liquidity in the financial market while reining in on the foreclosures through affordable lending programs, the progress has been either too slow or in many instances absolutely non-existent due to the bailout beneficiaries’ usual business tactics.
Meanwhile, the financial institution such as Fannie Mae and Freddie Mac executives are back in action with the same modus operandi i.e. extravagant bonuses for extraordinary failures in the sub-prime mortgage debacle that initiated the free fall of the economy into the ditch.
In the health care reform as cited above, the proof of the pudding relies on the economic impact of the remaining uninsured millions other than the 30 millions predicted to be covered under the exclusively private proposal. Other issues, like raising taxes on health care plan opted by the work force in lieu of employment benefits are a matter that will weigh in on the cost factor determined by the supply and demand free market elements.
“Some things never changes,” regardless of the power in the White House or the Congress is evident in the past year evaluation.
The Wall Street traditions continue with the financial, health care, communications and energy industries dictating terms and conditions in defiance of the free market fundamentals.
Among them are:
Demanding bailouts and refusing to be subject to scrutiny,
Legislations drafted to promote obscene profits at the expense of exhausted taxpayers and exploited consumers eventually driving the economy to the cliff and,
Last but not the least the communications industry, Comcast resisting government intervention in the monopoly of the diverse media, such as the takeover of NBC and sister networks along with the national communications service and AT&T barring competition in the deal with Apple computers in the Smart Phone – iPhone subscription services and more.
With respect to green jobs creation, the notion is ideal and it would invigorate the battered economy, provided the energy giants do not railroad the budding entrepreneurs vital to expand the sector for community access and local job opportunities.
It’s clear that the ideological sniping from the left or the right is ineffective with the administrations in power succumbing to Wall Street pressure on all issues.
There is one thing to expect loyalty from the supporters through lavish praise and flattery that would simply qualify as cronyism in the backdrop of ‘business as usual’ environment. Another aspect where the actual situation in people’s life has not changed in terms of retaining jobs, homes and the health care proposal entirely entrusted under private care responsible for the status quo.
My silence is not necessarily my disappearance into the oblivion. Any suggestions and requests made thus far in both domestic and foreign policies have been slighted even though they are decisively in favor of the struggling populace at home and abroad. Perhaps, that might be the cause for the utter disregard of opinions and ideas offered upon several political figures’ insistence to participate in the legislative process.
For instance, my request towards transparency and accountability promised during the election campaign by the Obama candidacy has deviated to closed chamber discussion with lobbyists and party members notably in the health care legislation, financial regulations and climate bill negotiations.
I’ve been urging that the oversight committee (if it exists!) hold the financial sector accountable for the bailouts and demand they comply with their end of the bargain in facilitating the credit flow and lending practices crucial to energize the stagnant economy, is largely ignored.
Likewise, the stimulus packages passed under both Bush and Obama administrations viz. TARP money $700 billion in 2008 and $787 billion in 2009 respectively has substantial amounts in cash that has not been invested vigorously to protect or create jobs in the manufacturing sector and public projects i.e. infrastructure maintenance, green technology etc.
I’m still awaiting on the logical reasoning behind withholding the vast stimulus funds for purpose other than the economic recovery via housing market revival, job growth and tax credits to small businesses and medium corporations who are forced to minimize overheads through job cuts.
In addition, the Congress passed relief funds for meager $75 billion to deal with the housing market particularly to decelerate foreclosures, is reportedly served with an acute amount of approximately $2.3million and not billion. Further, it’s reported that the treasury secretary Timothy Geithner’s explanation was “the funds held in reserve to rescue financial institutions from the housing market downturns.”
I emphasized on the required urgent action during the Bush administration bailout activities in resurrecting the Glass-Steagall Act and the long overdue aggressive financial regulations to prevent the precipitous decline of the financial assets hurting the average citizens. Not surprisingly, it received no attention.
Now, it appears that the recently passed House bill on the financial reform has incorporated some of the rigorous policies instead of the comprehensive GS Act possibly anticipating the standard revolt from the Senate.
Not all is lost but there are serious grievances among the general public that are justified with the families facing economic difficulties and it’s appropriately revealed during the November 2009, gubernatorial and congressional elections.
Considering the facts, should one remain complicit to the prevalent camaraderie between Wall Street and Washington in spite of the culture corroding the systems and bankrupting small businesses and ordinary individuals in the society?
My specific role is to represent the people i.e. the humanity at the domestic and international fronts. The task is to work for the general mass and common good to restore democracy, peace and harmony, social justice and freedom, the basic right of all living beings.
Unfortunately, the guidance on foreign policy has been deliberately dismissed by selective entities with a cavalier approach to humanitarian crisis affecting millions of innocent lives. There will be in-depth discussion in this context to dispel the myths and misconceptions surrounding the international crises.
Washington functions on the dogma that “Those who try to please all, pleases none.” The irony in the legislators’ action is the public interest invariably marginalized over the personal and special interests in the appeasement trend.
Hope and Change is yet to be experienced and possible with a paradigm shift that recognizes alleviating people’s plight as the primary goal in public service.
Thank you.
Padmini Arhant
National Unemployment – A Reality Check
November 10, 2009
By Padmini Arhant
According to the latest reports, the current jobless rate is 10.2% with 16 million Americans competing for 3 million jobs. Apparently, this figure does not include the underemployed. The Corporate related unemployment is further expected to rise up to 10.8% by the end of next year. Another grim factor is the joblessness among the self-employed and the small business retrenchments reportedly escalate the figure to an alarming 17.5% resembling the severe depression era.
Growing unemployment is a major impediment as consumer spending is directly linked to the job market posing a downside for the entire economy. Despite, the economic growth at 3.5% along with the 9.5% annual productivity for the recent quarter, the American workforce is yet to benefit from the surge in these areas.
The most affected sectors appear to be construction, manufacturing and retail. Although, the recent stimulus signed by President Obama extends unemployment benefits for 14 weeks and 20 weeks to the worst hit states combined with the tax credits for the first time and other home buyers, the problems confronting the industries required to generate jobs is attention worthy.
Construction industry is obviously dependent upon the housing sector and the housing market revival methods are due for review with respect to foreclosures and lending practices by the finance sector.
In fact, the credit crunch is predominantly responsible for the sluggishness in the respective areas of the economy. Unless and until the bailed out finance industry honor the commitments made to the American public during the substantial bail outs, the industries tied to credit market particularly the housing, manufacturing and retail cannot emerge from the recession.
If the various bailouts approved thus far have the built-in transparency and accountability factor then the oversight committee ought to investigate the recipients on the investments of those taxpayer funds legislated for providing jobs and stimulating the economy. Regardless, the trillions of dollars accumulated to the national deficit from the banking sector and automobile industry bailouts deserve scrutiny in terms of actual allocation that is not conspicuous given the depressing jobless data.
On the other hand, the government must provide a legitimate reason for not moving forward with the committed investments held in the $787 billion stimulus package including the remainder from the Bush administration passed TARP funds. When the controversial economic stimulus took place at different times, the purpose was to revitalize the economy with the desperately needed job growth besides enabling the relevant productivity levels and overall economic performance.
Any delay in energizing the job market would adversely affect the broader economic prospects for all industries with the consumer base lagging in the necessary spending, the fulcrum of the economic cartwheel.
Manufacturing industry has been harshly hit with the corporate executive failure in the automobile industry precipitated by the finance sector’s liquidity freeze that triggered the economic meltdown in the shadow of the hedge funds and sub-prime debacle. It is imperative to jumpstart the manufacturing sector macro economically to achieve the targeted employment goals.
Evidently, the prevailing policies and the applied mechanisms are either inadequate or ineffective. Perhaps, the additional or aggressive measures could bolster the weak sectors in promoting the anticipated job growth, the real indicator of the economic pulse. Nevertheless, the consolidated interjection of the monetary reserves and management resources from the private and the public sector is paramount to resuscitate the ailing job market.
A disturbing aspect of the impressive 9.5% productivity report is the executive attitude towards the workforce. In spite of the workers’ significant contribution, i.e. limited labor force tripling the mass production, the management has categorically denied wage increases, additional hiring or other compensations in the form of bonuses etc. claiming that it would be detrimental to the organization ‘s profit oriented schemes.
It is elaborated as corporations aimed at increased earnings in the backdrop of weak dollar, declining exports, business decision to operate on lower inventories and other economic woes. As reasonable as they might be, somehow the conditions seem to apply only towards the labor force explicitly stated by the industry spokesperson that the workers should remain content with the fact that they have a job in the gloomy economy.
Meanwhile, the CEO’s salary package maneuvered from the Congress chided bonuses to lucrative shares and stock options with immediate encashment irrespective of the corporate results; the disingenuous modesty is adequately serving the highest in the hierarchy. Never mind the exploitation of the workforce, the human capital in this context.
In terms of the businesses with cash reserves operating on small inventories, the strategy is counterproductive, not to mention the catastrophic impact on the wholesale, small businesses and the retail industry. The wholesalers relying on the medium and large corporations’ inventory purchases forced to carry out massive layoffs potentially having a ripple effect on the economy with a possible inflation.
The swift passage of the ‘Cap and Trade’ bill boosting the green technology sector would be a phenomenal job growth subsequently alleviating the burden on the national deficit.
In light of the available facts, it would be appropriate to attribute the unemployment status to the myriad of activities or the lack thereof by both private and the public entities. It could be highlighted as the culmination of stringent corporate policies, limited private and public investments, reining credit flow, uncontained foreclosures and lack luster home sales in the housing market…causing the precarious unemployment situation.
Therefore, the government and the free market thorough evaluation of the status quo are essential to invigorate the frail job market.
A jobless economic recovery ultimately leads to a negative economic trend in the absence of robust stimulants explained above. Jobs represent the nerve of the economy with serious economic and political ramifications.
Contrary to the rhetoric echoed in the chambers of Congress and the media, the health care reform is equally important in the equation because it bankrupts the small businesses and individuals alike. Both groups are constantly struggling to make ends meet with the atrocious health care costs prohibiting investments in other necessities.
Economy and health care matter are intertwined and partisan politics has no place at the critical moment debilitating many American lives.
It is incumbent on the United States Senate to rise to the occasion and overwhelmingly approve the health care bill with the federal run health care program titled as the ‘public option’ in recognition of the American plight.
The simultaneous actions by Washington and free market are vital in curbing the rising unemployment statistics. Job assurance to every American translates into job security for the legislators and the executives. Since jobs create taxpayers and consumers,
Washington and Wall Street cannot thrive without progress in the main street.
Thank you.
Padmini Arhant
Capitalism alias Communism
September 6, 2009
By Padmini Arhant
Throw a treat to the man’s best friend and he/she will do any tricks for you.
Not quite true, contrarily some canines unlike the ‘few’ in their masters’ species resist being the “Pavlov’s dog.” Besides loyalty, the canines’ discriminative power is unparallel to the particular voices on the airwaves and cable news network ever willing to perform on the note – ‘show me the bait and leave the trashing to…’
Lately, with the relevant media on vacation, the field is wide open and vulnerable for dumping wastes of all kind. As usual, the specific network presenting ideas and style taken right out of their targets’ page yet choosing to remain oblivious to’ plagiarism,’ do not refrain from perennial attack politics.
Recently, there has been deafening noise and fear mongering about the nation becoming ‘Communist’ and claims that certain entities may be out to destroy the sanctity of the sacred ‘Capitalism.’ Further, the network featuring the long confused biracial harmony against the alleged Anti-Profit, Corporate bashing otherwise the ‘indomitable’ alien force is indicative of the desperate times seeking desperate means.
It’s a feast to the eyes when the image on the HD / 3D monitors transcends race but again demoralizing when it happens for the wrong reasons. As though the berating isn’t enough the religion is brought into the conversation as an ally. The emphasis on the United States of America, proclaimed as the exclusively “Judio-Christian” nation presumably conquered by the aliens determined to eliminate the demonstrably competent ‘Capitalism’ and threaten the viability of the robust free market system. Never mind the other religious representations and diversity in the society. They are mere taxpayers, consumers and statistics among the electorates.
It should be obvious by now that the United States is a planet within a planet with the multitude race, religion, non-religion and several other factors from all over the world. The bellicose barrage playing the religious card is nothing but gutter politics.
Whatever works to polarize the democratic secular system used to ignite the sparks regardless of the blazing fire possibly consuming the pyrotechnicians and the entire gamut?
In view of the over pouring incendiary remarks marred with ignorance, it’s essential to demystify the myth dominating the communication mass media, the single most propaganda machine overly misused in the modern age partisanship.
Understanding Communism:
Karl Heinrich Marx, The German political economist, sociologist… perhaps conceptualized a utopian environment against the extreme inequalities at that time. The political theorist’s influence over the exploited working class permeated the western and central Europe, and subsequently the other parts of the world.
Communism emerged from the societal decay with the wealth concentration in the particular segments, i.e. the agricultural landowners and merchants seeking entitlement to national wealth while depriving the remaining population from similar fortunes, and leaving them to compete with one another in the Darwinian ‘survival of the fittest’ world.
What began as the revolutionary movement towards the greater good for all developed into the previously condemned parochial system, as it operated with the power sanctioned to the selective groups in the nation governance that simultaneously set aside the enormous wealth for them in the name of the republic. Communism on the face of it initially portrayed as the well-oiled machine satisfying the wants of all, only to be degenerated in the systemic abuse of power.
Even though ‘Communism’ spread to benefit the ‘Community’ with the objective of creating a classless and stateless society, the end did not justify the means. The classic examples are the former Soviet Union and the present China, Cuba and North Korea.
Again, the interesting twist in the twenty first century is the nostalgia for the former Soviet era among the economically deprived many Russian citizens in the fast-paced ‘ONG’ (Oil and Natural Gas) enriched Russian economy.
In fact, the United States held responsible for the failure of the former Russian leader Mikhail Gorbachev’s ‘Glasnost’ (Government Accountability and Transparency) and ‘Perestroika’ (the political and economic reform). The reason attributed to the Western paranoia to the pervasive ‘Communism’ and the secrecy behind the iron curtains.
The irony in the response to Communism by the United States is the successful dismantling of the former Soviet Union along with the brutal deterrence in Vietnam, Laos and Cambodia, and isolating Cuba and North Korea, while fervently forging alliance with the vastly threatening Communist regime in the Far East – China.
Communism soon became the most dreaded form of authority in the latter half of the twentieth century because of the iron fist rule in the former Soviet Union and across the Soviet bloc, that caught on like the wild fire to the South Asian regions led by China and adapted by Latin America in their rejection of feudalism.
Furthermore, the equality theme dissipated with the ruling Communists’ power absorption and control of the major institutions on the land, specifically the mass media. As a result, the population promised to be free of social and economic barriers subject to severe oppression on all accounts like in the case of contemporary China, Cuba and North Korea.
Perspective on Capitalism:
The widespread ‘Communism’ in the mid twentieth century triggered the wealthy to converge and protect their capital in the ‘Capitalist’ economy more so than ever. Capitalists’ paradoxical dual platform was protectionism while floating free trade practices essentially enabling a monopoly on not only the national but also the global economy. Hence, the free market archaic labels on every consumer product sold in the global market.
In an uncanny resemblance to the ‘Communist’ system the free market has not met the expectations of the people in the society as they are entrenched in consumers and workers exploitation like their counterpart ‘Communism.’ The common tools for both systems are ‘Power’ and ‘Wealth’ for suppression of freedom and choice in the form of civil liberties evidenced in the on-going ‘health care’ battle.
How did the free market infiltrate the national economic and political scene?
The Capitalist agenda thrives in a democratic system with mega investments in the political campaigns. All levels of government i.e. local, state and federal elections are heavily funded by the lobbyists aka the ‘Special Interests’ representing every imaginable industry. Any effort to legislate the ‘public’ financing with a cap on electoral spending demolished prior to the declaration of such process to let the private industry proliferate in the nation governance usually beginning on the campaign trail.
Some poignant moments in recent memory –
The finance sector giants such as ‘Goldman Sachs’, AIG, Citi groups etc smoothly organizing the fire sale of the rivals and massive bailouts for themselves. The oil industry with Exxon Mobil, Chevron Texaco, ConocoPhillips and others possess the political proxies in the House and the Senate rallying for off shore drilling and blocking the ‘Cap and Trade’ energy bill.
Should the ‘health industrial complex’ trail behind in the muscle-flexing match?
Absolutely not. Therefore, the Health Care Industry actively promoting the anti-government slogans through their paid political representatives, so that they can continue the absurd profiteering strategy without the people represented public option in the contentious health care reform.
On a broader perspective, the national defense controlled and managed by the ‘military industrial complex’ behind every military operations ranging from the civil to international wars vehemently opposed to any ‘peaceful’ resolutions to justify the phenomenal defense budget crescendo regardless of the political factions in the White House.
The proof of the pudding is in the decision to proceed with the additional troops deployment in Afghanistan. Despite the colossal failure in the ‘so-called’ war against terror, the pursued military occupation misdirected as ‘nation building.’ Such adamant position is reflective of the Machiavellian policy and ‘hawkish’ representation at crucial levels of government, relevant departments in the administration and the defense hierarchy. Ignoring the human casualties on all sides and squandering the scarce national resources is the motto of the defense program conspicuous in the status quo.
The role of Kellogg Corporation and the internationally defamed ‘Halliburton’ in Iraq and Afghanistan herald the degradation of morality in the lowest order.
Again the private industry prioritizing extravagant profit over people’s lives is synonymous with the military and medical industrial complex, ‘apparently’ engaged in saving and safeguarding lives.
Likewise, in other areas of life sustenance the Nuclear industry in their effort to leave the footprints has the legion in Congress, respective Cabinets and the White House to stampede the renewable energy alternatives in the green technology vogue. In this context, the anti-environment coalition is ever stronger than witnessed before. It’s not uncommon for the opposition to rise against the incumbent power’s any and every policy. However, the vitriolic politics defying common sense and logic in the ‘global warming’ issue is the height of idiosyncrasies that is reprehensible.
How does Capitalism perform in the global economy?
Globalization is nothing but the marginalization of the domestic and foreign workers alike. The two most important wings of the business sector, the workers who are also the consumers are the convenient scapegoats for the free market operators. In order to cope with the vigorous global competition, the corporate downsizing with massive layoffs or outsourcing at a relatively cheaper rate with a disregard for standard labor laws on foreign soil is the preferred path to ‘Nirvana,’ (the eternal bliss), in the capitalist jargon it is the cornucopia of profits.
As for the environmental hazards are concerned, the deadly gas leakage in the devastating Union Carbide disaster in Bhopal, India – killing several thousand residents and abandoning millions suffering from life threatening diseases as well as the oil spilling on the domestic and international shores meticulously evaded or dealt against it through the top-notch legal expertise hired at a premium price.
Global economy is also heavenly for tax evasions with the Corporations reallocating off shore income towards their personal future.
The icing on the cake is the communications mass media – a blaring private and free market owned enterprise to undermine democracy. Issues of national interest and citizens welfare browbeaten to conjure the dazed viewers and readers. At the same time there is responsible journalism visible in the most editorials, columns, articles and television presentations other than the cyberspace to counteract the partisan tidal wave
Lately, the legitimate concerns in the form of opinions, ideas and commentaries on numerous national and international issues either discounted or dismissed as an unqualified intervention in the asserted ‘our highest government ’ matter, striking yet another chord with ‘Communism.’ in the first amendment right.
Aiming at profit is the fundamental cause for any commercial activity. Nevertheless, the methods and strategies to achieve those profits often found unscrupulous in the modern market economy. Wealth acquired at the cost of the citizens’ life and livelihood does not last long, and no sooner than later the proprietary disillusioned on the asset transformed into liability.
The analogy presented, as “One size do not fit all.” It does not apply to those corporations playing by the rules with an utter respect for the democratic political system…stay focused on the business management rather than ‘nation’ control. These Corporations occasionally victimized by the labor Union’s excessive demands viz. higher workers compensation under the guise of ‘labor protection.’ There are also individuals abusing consumer rights in business dealings with contempt for the other party’s status.
The excessive greed for ‘Power’, ‘Profit’ and ‘Popularity’ in the aggressive world economy and political system has eroded the human qualities for care, compassion and courage to uphold justice and fairness in the society.
Concisely, Capitalism is the new era Communism dictating terms and conditions to the market forces and intrusively implementing national policies through political agents on the prolonged or permanent Corporate payroll at the dawn and during the representative’s political career.
The common denomination under both systems is – the powerful oppress the powerless and the victims are none other than the general population in both Capitalism and Communism.
Democracy is meaningful with the government of the people, by the people and for the people.
Thank you.
Padmini Arhant
.
Finance Sector and Economic Impact
August 31, 2009
By Padmini Arhant
When the Bush administration officially recognized the economic recession in late December 2007, the malignant cancer in the financial sector was widespread – originating from gross mismanagement, underhand dealings, some in breach of lenient SEC regulations… a scenario analogous to the health abuse by overindulging individuals submitting to a potentially terminal illness.
Upon diagnosis, the prognosis called for a radical treatment to prolong life. Hence, the former administration executed a series of financial bailouts commencing with Bear Stearns, AIG, including major and minor banks bailout to a tune of $700 billion TARP (Toxic Assets Relief Program) fund.
Incidentally, the former Treasury Secretary Henry Paulson bound by vested interest and commitment to his alma mater Goldman Sachs let the comparable investment group Lehman Brothers submerge into insolvency.
Is cherry picking a coincidence or key Treasury representative fulfilling obligations to the dominant force Goldman Sachs in the finance industry?
Please refresh your thoughts after reviewing the blogpost ‘Bailout Debacle’ March 22, 2009 listed under Economy and Business category at www.padminiarhant.com
In this context, the cited article revealing facts behind the bailout is attention worthy.
According to http://www.wsws.org/articles/2008/sep2008/paul-s23.shtml – Thank you.
Published by the International Committee of the Fourth International (ICFI)
Who is Henry Paulson?
By Tom Eley, 23 September 2008
“Henry Paulson rose through the ranks of Goldman Sachs, becoming a partner in 1982, co-head of investment banking in 1990, chief operating officer in 1994. In 1998, he forced out his co-chairman Jon Corzine “in what amounted to a coup,” according to New York Times economics correspondent Floyd Norris, and took over the post of CEO.
Goldman Sachs is perhaps the single best-connected Wall Street firm. Its executives routinely go in and out of top government posts. Corzine went on to become US senator from New Jersey and is now the state’s governor. Corzine’s predecessor, Stephen Friedman, served in the Bush administration as assistant to the president for economic policy and as chairman of the National Economic Council (NEC). Friedman’s predecessor as Goldman Sachs CEO, Robert Rubin, served as chairman of the NEC and later treasury secretary under Bill Clinton.
Since taking office, Paulson has overseen the destruction of three of Goldman Sachs’ rivals.
In March, Paulson helped arrange the fire sale of Bear Stearns to JPMorgan Chase. Then, a little more than a week ago, he allowed Lehman Brothers to collapse, while simultaneously organizing the absorption of Merrill Lynch by Bank of America.
This left only Goldman Sachs and Morgan Stanley as major investment banks, both of which were converted on Sunday into bank holding companies, a move that effectively ended the existence of the investment bank as a distinct economic form.
These bailouts have been designed to prevent a chain reaction collapse of the world economy, but more importantly, they aimed to insulate and even reward the wealthy shareholders, like Paulson, primarily responsible for the financial collapse.
Paulson bears a considerable amount of personal responsibility for the crisis.
Paulson then handsomely benefited from the speculative boom. This wealth was based on financial manipulation and did nothing to create real value in the economy. On the contrary, the extraordinary enrichment of individuals like Paulson was the corollary to the dismantling of the real economy, the bankrupting of the government, and the impoverishment of masses the world over.
Paulson was compensated to the tune of $30 million in 2004 and took home $37 million in 2005. In his career at Goldman Sachs he built up a personal net worth of over $700 million, according to estimates. “
————————————————————————————————–
True Perspective: By Padmini Arhant
The entire economic meltdown ceremoniously attributed to the financial sector’s wayward unruly conduct in the absence of limited or no regulation. Typically, it’s a free market voluntarily surrendering to a free fall after skyrocketing profits in the pockets of privileged few in the society.
Who did the private enterprise otherwise the market system’s oligarchs approach for salvation?
It was none other than the taxpayers of the economy represented by the government.
It’s poignant to underscore the convenience for private sectors to seek the taxpayer i.e. government’s assistance when they are drowning and fleetingly dismiss the same government as an incompetent, redundant agency during the buoyancy like in the health care battle.
The day is not far when the health care and insurance industry configured to the obscene profit driven settings mimic their counterpart finance industry imploring the taxpayers/consumers bailout.
When the wealth management industry succumbs to their own greed ladened follies, can the health care and insurance industry sustain the malpractice at the economy’s expense?
If there is any respect for the laws of nature or ethical consideration, the key economic components such as the finance, health industry and others would realize that universally every substance has a limited potential to thrive and exceed performance level at any given time. The mankind periodically experienced catastrophic blows in the form of severe economic recession to ‘Great Depression’ due to the prevailing markets inertia.
Still, the lesson is never learned by the delusional segment forging permanency on this planet; choose to remain confined to the improbable cause in wealth amassment.
Now directing focus on the finance sector, the ‘artful dodger’, a nickname of the Charles Dickens’ melancholy character ‘Oliver Twist’ when turned down for more porridge, despite the courteous magic word ‘please,’ was never discouraged to maneuver the situation in personal favor.
Unlike the character ‘Oliver Twist’ a victim of severe socio-economic disparity…parallel to the modern twenty first century reality, the finance sector is well armed with tactics adherence to the rule of law in appearance but decisively biting the hands that feeds them, i.e. the consumers and taxpayers.
What are the latest strategies by the finance industry to clean up the mess on their balance sheets?
The current trend in the finance sector is adapting to the new age attraction i.e. presentation and mass appeal even if it is lacking in substance. If anything achieved from the domino effects by the financial sector, it is the mastery of unsavory techniques to impress shareholders at the consumers’ peril.
During the bailouts, both the prior and the incumbent administrations were unequivocally guaranteed instant revival of the lending activity, a predominant factor in the liquidity crisis exacerbating the economy until date.
It’s been nearly twelve to eighteen months since the infamous massive bailouts with no relief to the average citizen, retailers or the small businesses, crucial for the economic recovery. The economy deprived of the consumer spending flow because of the financial institutions’ stringent policy to hoard the taxpayers’ funds received in the form of bailouts at zero percent or nominal interest rate. Instead the taxpayer bailout is unabashedly used for extravagant bonuses to the architects of the financial calamity.
Although, the Obama administration recently capped the finance charges and interest rates on credit card borrowings to ease the extraordinary burden on average citizens, the industry leapfrogged Congress with discretionary interest rates not limited to atrocious 29.9% APR and threatening to increase further on default payments.
Another proactive measure by the banks in an effort to window dressing the balance sheet was minimizing risk exposure related to credit card and consumer lending. The industry defiantly targets the vulnerable groups like students, homeowners and the lower to median income consumers with abrupt cancellation of accounts in good standing.
The irony is noteworthy. It’s considered perfectly normal if the finance industry absconded their responsibility to the American taxpayers/creditors not barring any accountability to the oversight committee regarding the bailout investments. However, the then taxpayers/creditors as consumers/borrowers now subject to scrutiny and unprecedented means by the same financial institutions holding the mantle to lending and borrowing.
While the myriad of finance industry borrowed taxpayer funds at zero or negligible interest rate, the sector in return either withholding financing in most cases or lending at an exorbitant rate to the consumers who are also the creditors.
In the housing market, the situation synchronizes with the other lending areas such as credit card, personal loans etc. The reason for the agonizing slump in the real estate across the nation squarely falls back on the commercial banks reluctant to unleash the cash flow to qualified first homebuyers and responsible mortgagees/homeowners unable to purchase or refinance their homes. The stranglehold on consumer borrowing precipitates the foreclosures notwithstanding the vertical decline in home sales and values.
Again, the White House initiatives to restrain foreclosures and assist primary residence owners through TARP fund allocation need evaluation as the financial institutions are focused on ‘business as usual’ and not measuring up to the rigorous standard that exists for average consumers while the bailed out financial industry borrowers exempt from it.
The status quo is inadequate and compromises the high value homes in the government pursuit to rescue the conforming loans, i.e. Fannie Mae and Freddie Mac toxic assets. Fannie Mae and Freddie Mac, is a private company backed by government funds.
Not surprisingly, the illicit practice permeated to the commercial real estate affecting the prospects in that segment.
Home equity, the major and sometimes the only asset for overwhelming majority being inaccessible along with the spiraling health care and insurance costs for families, the overall economic impact is enormous forcing many to bankruptcy accelerated by the escalating unemployment rate.
Did the bailout beneficiaries show any evidence to qualify for funding?
Supposedly not, then why should they be allowed to run the economy into muck and handsomely rewarded with taxpayer bailout for the colossal failure in financial history?
Where are the taxpayer funds invested and why are they not held accountable thus far?
Is the financial market granted constitutional immunity?
And if not,
What is holding the legislators from intervening on behalf of the electorate to probe the public affairs maintained as private matter by the industry?
Meanwhile, the investment group, Goldman Sachs implicated for alleged insider information to high value investors through trade specialists deserve proper investigation and due process. The SEC regulations must apply to all without exception in absolute transparency.
With the holiday season approaching, the consumer spending is vital to expedite the stagnant economic growth. As stated above, the positive development in housing and job market intertwined with the investment pace, only possible through private sector faithful participation in lending and reactivating the economy.
Unless and until the finance sector across the board, the commercial, investment and insurance industries get their act together and relinquish the ‘subprime’ syndrome, the sagging economy will continue and eventually consume the source, the financial groups.
The financial sector is obligatory to the taxpayers as creditors and borrowers particularly with respect to the disproportionate bailouts.
Finally, with no further procrastination on the financial markets audit, it’s imperative for the Congress appointed oversight to obtain legitimate explanation on investments and lending abstinence. Any dissatisfactory response and non-cooperation by the industry must be pursued with mandatory judicial protocol.
Thank you.
Padmini Arhant
Economic Bailouts On An Unprecedented Scale
July 23, 2009
By Padmini Arhant
Presentation of Economic Bailouts on an Unprecedented Scale
From: Stimulus Package Details
Source: http://www.stimuluspackagedetails.com/bailout.html
Mortgage Stimulus Packages
No industry has been helped more by the various economic stimulus packages than the real estate industry.
Add it all up, and $500 billion was committed in 2008 by the Bush Administration, and
The Obama Administration chipped in another $275 billion in early 2009, not to mention the $1 trillion that was designated for buying up toxic assets (which are comprised primarily of sub-prime loans given to suspect borrowers, collateralized by overvalued real estate).
Economic Bailouts On An Unprecedented Scale
Starting in 2008, and extending into 2009, the U.S. Federal Government became involved in a myriad of companies and industries, handing out bailouts at an alarming rate, blurring the lines between capitalism and socialism, free enterprise and government intervention.
Below, in alphabetical order, are the major recipients of economic bailouts.
Automakers
$25 billion in low-interest loans to General Motors, Ford, and Chrysler
$22 billion in low-interest loans to General Motors, Chrysler
$30 billion to help General Motors steer through bankruptcy
Total: $77 billion
AIG – Insurance Company
$60 billion loan – September 2008
$40 billion purchase of preferred shares – September 2008
$25 billion in purchase of toxic assets – October 2008
$25 billion loan (credit limit raised to $85 billion total) – October 2008
$30 billion loan – 2009
Total: 180 billion
Bear Stearns – Investment Bank And Brokerage Firm
$29 billion in guarantees – 2008
Fannie Mae/Freddie Mac – Mortgage Companies
$300 billion – 2008
$200 billion – 2009
Total: $500 billion
G-20 World Leaders Stimulus
$1 Trillion Stimulus Package – G-20 World Leaders Stimulus – April 2009
The leaders of the 20 most powerful countries in the world (representing 85% of global economic production) convened in London and agreed to $1 trillion in economic stimulus funds, as well as tighter global financial regulations.
June 2009 update: According to the Obama Administration, only about 5% of the $787 billion stimulus package passed in February 2009, has been distributed.”
————————————————————————————————–
Upcoming Podcasts and Website Accessibility – Padmini Arhant
OM Nama Sivaya – Glory to Almighty God!
OM Nama Sivaya - Glory to Almighty God !
Happy Pongal! Happy Makara Sankaranthi! 2025
Happy Pongal!
2025
Padmini Arhant
Image Credit: Artist via paid subscription source. Thank you.
Happy Makara Sankaranthi!
Image Credit: Designed by Freepik Artists. www.freepik.com – Thank you.
FASCISM WRIT LARGE AS THE SO-CALLED DEMOCRAT
FYI : California Franchise Tax Board
Sacramento, CA
For the umpteenth time – Please refer to the third letter dated June 13, 2024 received by you with signed delivery confirmation. The letter with proof of tax payment on August 23, 2023 with 2022 tax return e-filing, bank confirmation on the payment and email references were all enclosed for your reference and settlement on this matter.
Yet, for political reasons the weaponization of taxpayer funded State and federal departments and agencies trending since 2009 – 2016 against then Republican Tea Party by Barack Obama in personal vendetta against them for questioning Barry Soetoro’s birth certificate was responded with terminating the Republican Tea Party in the first term in 2012. It was just the tip of the iceberg.
The trend then continued against political opponent Donald Trump from impeachment proceedings to libel suits with no end in sight.
Similar tactics deployed against me and my family by the same members i. e. The OBAMAS having abused and continue to use and abuse our presence, profile and all things politically and personally exclusively beneficial to them from DAY ONE until now by tagging, trolling, pirating anything positive and impressive for image enhancement despite being warned to cease and desist.
Notwithstanding thousands of $$$ fraudulently amassed from us by the fleecing scammers, abusers and parasitic exploiters till date make them indebted to me personally and my family.
Politics’ underhanded bullying and harassment is sheer desperation in the face of own extinction.
If you can’t express gratitude as the chief beneficiaries of our timeless sacrifice and benevolence, the least you could do is abandon the self-destructive attitude hurting you in the attempt to harm others.
By the way – nothing to do with Angel Reese and anyone with Brown last name in your nuanced attacks directed at me. They are all yours and you can keep them.
That goes for Kamala Harris – the name Kamala adopted from my explanation of my first name conveniently plagiarized for political and fortune harvesting in your end game once again for en masse deception like in 2009 – 2016.
The same resumed in 2021 – 2024 with blatant intention to extend the sham indefinitely with ludicrous WOKISM.
Originality and FAKE distinction is authenticity never in requirement to be anything other than true self unlike the impostor ever remaining fraudsters in vain.
Padmini Arhant
Character Not Color That Ever Matters
Lord Ram emphasized on deeds aka Karma not creed that matter in living and after life.Dr. King – related to that by echoing the content of the character not color that matters.
It’s time to move towards clear aka colorless society and nurture the importance of deeds with merit and virtues instead of remaining stuck in color coding society. Such trend only reveal opportunism with polarization rather than unity and harmony amongst human race.
Padmini Arhant
Exploitation – Knows Nothing About Gratitude and Truthfulness
Padmini Arhant – PadminiArhant.online
Padmini Arhant – Gaza War and Rafah Air Strike
Independent Free Palestine – Jan 2024 Speech
Celebration – Bright, Beautiful & Picturesque
Bright, Beautiful & Picturesque
Swastika – The Sacred Symbol – All is Well
Organic Intelligence Erring!
The ones flaunting the so-called organic intelligence with constant jibes at the allegedly artificial intelligence could perhaps seek assistance from the latter in spelling adjectives correctly to make sense of the message. Even basic spell check feature would serve the requirement.
The country is indeed precious not prescious than any individual, entity, political party, institution and organization.
Needless to say, it is applicable all around without exception.
Unlike the trend, smothered in hypocrisy beckoning others to do what is apparently unacceptable to selves to the extent of blasphemy.
Padmini Arhant
Get over the 🤚🏽✋✌🏼✌️✌🏿 🙏🏽🙏🏻🙏🏽🙏🙏🏿 mania!
Get over the mania!
🙏🏽🙏🏻🙏🏽🙏🙏🏿
mania as that is not going to deliver what is aimed at and desired in vain except confirming your asinine indulgence.Besides in politics such as Indian corrupt criminal signature trait is exclusively yours and no monkey see monkey do act can change it for it is attached to you like skin and bone.
Padmini Arhant
Padmini Arhant with Divinity Shiva
Celebration of Lord Krishna
Message to Humanity – Padmini Arhant
Spread peace and engage in non-violence. Speak truth with courage. Heed your conscience. Respect life. Serve your nation and people with honesty and integrity. Espouse human values and exemplify in deeds with care and compassion. Voice concern over injustice. Be part of the solution and not the problem. Love mankind and environment for universal harmony.
Peace is Eternal Bliss.Padmini Arhant
தமிழ் புத்தாண்டு 2022 நல் வாழ்த்துக்கள்! Tamil New Year 2022 Greetings!
Padmini Arhant and Roshni Greeted by the Brilliant Light in the Horizon
Words of Wisdom from Venerable Gautam Buddha
Words of Wisdom from Venerable Gautam Buddha
Tamil OM Symbol & Pranava Manthiram
Absolute Truth
Reunion with Divinity God Shiva at Holy Mt.Kailash 2019
Padmini Arhant interaction with God Shiva during Parikrama of Mt.Kailash
Padmini Arhant Kailash Lake Manasarovar Pilgrimage 2019
Padmini Arhant on Parikrama or Circumambulation of Mt. Kailash
ARHANT Family at Famous Taj Mahal
Gautam Buddha’s Words of Wisdom
Peace Pledge
