The Defining Issue: Who Should Get the Tax Cut - the Rich or Everyone Else?
Sunday 19 September 2010
by: Robert Reich |
Who deserves a tax cut more: the top 2 percent — whose wages and benefits are higher than ever, and among whose ranks are the CEOs and Wall Street mavens whose antics have sliced jobs and wages and nearly destroyed the American economy — or the rest of us?
Not a bad issue for Democrats to run on this fall, or in 2012.
Republicans are hell bent on demanding an extension of the Bush tax cut for their patrons at the top, or else they’ll pull the plug on tax cuts for the middle class. This is a gift for the Democrats.
But before this can be a defining election issue in the midterms, Democrats have to bring it to a vote. And they’ve got to do it in the next few weeks, not wait until a lame-duck session after Election Day.
Plus, they have to stick together (Ben Nelson, are you hearing me? House blue-dogs, do you read me? Peter Orszag, will you get some sense?)
Not only is this smart politics. It’s smart economics.
The rich spend a far smaller portion of their money than anyone else because, hey, they’re rich. That means continuing the Bush tax cut for them wouldn’t stimulate much demand or create many jobs.
But it would blow a giant hole in the budget — $36 billion next year, $700 billion over ten years. Millionaire households would get a windfall of $31 billion next year alone.
And the Republican charge that restoring the Clinton tax rates for the rich would hurt the economy — because it would reduce the “incentives” of the rich (including the richest small business owners) to create jobs — is ludicrous.
Under Bill Clinton and his tax rates, the economy roared. It created 22 million jobs.
By contrast, during George Bush’s 8 years, commencing with his big 2001 tax cut, the economy created only 8 million jobs. And as the new Census data show, nothing trickled down. In fact, the middle class families did far worse after the Bush tax cut. Between 2001 and 2007 — even before we were plunged into the Great Recession — the median wage dropped.
It’s an issue that could also be used to expose the giant chasm that’s opened between the rich and everyone else — aided and abetted by Republican policies. As I’ve noted before, in the late 1970s, the top 1 percent got 9 percent of total national income. By 2007, the top 1 percent got almost a quarter of total national income.
These figures don’t even count in taxes. The $1.3 trillion Bush tax cut of 2001 was a huge windfall for people earning over $500,000 a year. They got about 40 percent of its benefits. The Bush tax cut of 2003 was even better for high rollers. Those with net incomes of about $1 million got an average tax cut of $90,000 a year. Yet taxes on the typical middle-income family dropped just $217. Many lower-income families, who still paid payroll taxes, got nothing back at all.
And, again, nothing trickled down.
As I’ve emphasized, the U.S. economy has suffered mightily from the middle class’s lack of purchasing power, while most of the economic gains have gone to the top. (The crisis was masked for years by women moving into paid work, everyone working longer hours, and, more recently, the middle class going into deep debt — but all those coping mechanisms are now exhausted.) The great challenge ahead is to widen the circle of prosperity so the middle class once again has the capacity to keep the economy going.
In other words, this is the right issue. It’s the right time. It allows Democrats to explain what the Bush tax cuts really did, why supply-side economics is bogus, and the economic challenge ahead.
Even if Democrats feel they have to respond to the Republican charge that taxes shouldn’t be raised on anyone when the employment rate is 9.6 percent, they have a powerful fallback: Extend the Bush tax cuts for everyone through 2011, then end them for the rich while making them permanent for the middle class.
Get it, Democrats? Please don’t blow it this time.
All republished content that appears on Truthout has been obtained by permission or license.
http://robertreich.org/post/1150695735
Tuesday, September 21, 2010
Sunday, September 12, 2010
Battle of Blair Mountain - redux
Lawsuit Targets Removal of West Virginia's Blair Mountain Battlefield From Historic Registry
Friday 10 September 2010
by: Sue Sturgis | Facing South |
Back in 1921, more than 7,000 miners outraged over working conditions in southern West Virginia's coalfields faced off against an army of some 3,000 police backed by the coal companies in an effort to bring in the union.
When the fight that came to be known as the Battle of Blair Mountain ended five days later after President Harding called in the U.S. Army, anywhere from a dozen to a hundred miners lay dead, along with as many as 30 people from the other side. It was the largest open class war in U.S. history, and the country's largest armed insurrection aside from the Civil War.
Today, a new battle is brewing on Blair Mountain -- this time over the fate of the land, which is threatened by coal companies' plans for mountaintop removal mining. The latest volley in that fight came yesterday when an alliance of environmental and historic preservation groups filed a lawsuit challenging the National Park Service's decision to remove the Blair Mountain Battlefield from the National Register of Historic Places.
"West Virginians regard Blair Mountain as sacred ground," said Gordon Simmons, president of the West Virginia Labor History Association, which brought the suit along with the Sierra Club, Ohio Valley Environmental Coalition and Friends of Blair Mountain.
Following a 13-year process that required the approval of a majority of the site's property owners, the National Park Service listed Blair Mountain on its National Register of Historic Places in March 2009. But nine months later, after coal companies eager to mine the Logan County site challenged the list of property owners who approved the listing, the Park Service struck the battlefield from its register. Sierra Club, OVEC and the National Trust for Historic Preservation asked the Park Service to revisit the decision, but it declined.
Robert Nieweg, director of the National Trust's Southern field office, said he believes the de-listing violated federal law and puts the site at risk of destruction.
"The decision to remove Blair Mountain from the National Register has gravely endangered this important site because the National Register listing would qualify Blair Mountain for special protection under West Virginia law," said Nieweg, whose organization named the site one of America's most endangered historic places back in 2006.
The need to protect the site is urgent: In July, Friends of Blair Mountain released a report documenting destruction that's already taken place at five locations within the battlefield.
The West Virginia Office of Historic Preservation is reportedly planning to renominate Blair Mountain for the national register. But that's not good enough for the site's defenders, who think it should never have been de-listed in the first place.
"The National Register listing was done correctly the first time and everything went according to procedure," said Simmons of the state labor history association. "The best and most expeditious remedy would be to reinstate the listing rather than go through the whole listing process again."
To read more about the campaign to save the historic battlefield, visit the Friends of Blair Mountain website.
Friday 10 September 2010
by: Sue Sturgis | Facing South |
Back in 1921, more than 7,000 miners outraged over working conditions in southern West Virginia's coalfields faced off against an army of some 3,000 police backed by the coal companies in an effort to bring in the union.
When the fight that came to be known as the Battle of Blair Mountain ended five days later after President Harding called in the U.S. Army, anywhere from a dozen to a hundred miners lay dead, along with as many as 30 people from the other side. It was the largest open class war in U.S. history, and the country's largest armed insurrection aside from the Civil War.
Today, a new battle is brewing on Blair Mountain -- this time over the fate of the land, which is threatened by coal companies' plans for mountaintop removal mining. The latest volley in that fight came yesterday when an alliance of environmental and historic preservation groups filed a lawsuit challenging the National Park Service's decision to remove the Blair Mountain Battlefield from the National Register of Historic Places.
"West Virginians regard Blair Mountain as sacred ground," said Gordon Simmons, president of the West Virginia Labor History Association, which brought the suit along with the Sierra Club, Ohio Valley Environmental Coalition and Friends of Blair Mountain.
Following a 13-year process that required the approval of a majority of the site's property owners, the National Park Service listed Blair Mountain on its National Register of Historic Places in March 2009. But nine months later, after coal companies eager to mine the Logan County site challenged the list of property owners who approved the listing, the Park Service struck the battlefield from its register. Sierra Club, OVEC and the National Trust for Historic Preservation asked the Park Service to revisit the decision, but it declined.
Robert Nieweg, director of the National Trust's Southern field office, said he believes the de-listing violated federal law and puts the site at risk of destruction.
"The decision to remove Blair Mountain from the National Register has gravely endangered this important site because the National Register listing would qualify Blair Mountain for special protection under West Virginia law," said Nieweg, whose organization named the site one of America's most endangered historic places back in 2006.
The need to protect the site is urgent: In July, Friends of Blair Mountain released a report documenting destruction that's already taken place at five locations within the battlefield.
The West Virginia Office of Historic Preservation is reportedly planning to renominate Blair Mountain for the national register. But that's not good enough for the site's defenders, who think it should never have been de-listed in the first place.
"The National Register listing was done correctly the first time and everything went according to procedure," said Simmons of the state labor history association. "The best and most expeditious remedy would be to reinstate the listing rather than go through the whole listing process again."
To read more about the campaign to save the historic battlefield, visit the Friends of Blair Mountain website.
Saturday, September 11, 2010
Michael Moore: If That 'Mosque' ISN'T Built, This Is No Longer America
If That 'Mosque' ISN'T Built, This Is No Longer America
OpenMike 9/11/10
Michael Moore's daily blog
I am opposed to the building of the "mosque" two blocks from Ground Zero.
I want it built on Ground Zero.
Why? Because I believe in an America that protects those who are the victims of hate and prejudice. I believe in an America that says you have the right to worship whatever God you have, wherever you want to worship. And I believe in an America that says to the world that we are a loving and generous people and if a bunch of murderers steal your religion from you and use it as their excuse to kill 3,000 souls, then I want to help you get your religion back. And I want to put it at the spot where it was stolen from you.
There's been so much that's been said about this manufactured controversy, I really don't want to waste any time on this day of remembrance talking about it. But I hate bigotry and I hate liars, and so in case you missed any of the truth that's been lost in this, let me point out a few facts:
1. I love the Burlington Coat Factory. I've gotten some great winter coats there at a very reasonable price. Muslims have been holding their daily prayers there since 2009. No one ever complained about that. This is not going to be a "mosque," it's going to be a community center. It will have the same prayer room in it that's already there. But to even have to assure people that "it's not going to be mosque" is so offensive, I now wish they would just build a 111-story mosque there. That would be better than the lame and disgusting way the developer has left Ground Zero an empty hole until recently. The remains of over 1,100 people still haven't been found. That site is a sacred graveyard, and to be building another monument to commerce on it is a sacrilege. Why wasn't the entire site turned into a memorial peace park? People died there, and many of their remains are still strewn about, all these years later.
2. Guess who has helped the Muslims organize their plans for this community center? The JEWISH COMMUNITY CENTER of Manhattan! Their rabbi has been advising them since the beginning. It's been a picture-perfect example of the kind of world we all want to live in. Peter Stuyvessant, New York's "founder," tried to expel the first Jews who arrived in Manhattan. Then the Dutch said, no, that's a bit much. So then Stuyvessant said ok, you can stay, but you cannot build a synagogue anywhere in Manhattan. Do your stupid Friday night thing at home. The first Jewish temple was not allowed to be built until 1730. Then there was a revolution, and the founding fathers said this country has to be secular -- no religious nuts or state religions. George Washington (inaugurated around the corner from Ground Zero) wanted to make a statement about this his very first year in office, and wrote this to American Jews:
"The citizens of the United States of America have a right to applaud themselves for having given to mankind examples of an enlarged and liberal policy -- a policy worthy of imitation. ...
"It is now no more that toleration is spoken of as if it were the indulgence of one class of people that another enjoyed the exercise of their inherent natural rights, for, happily, the Government of the United States, which gives to bigotry no sanction, to persecution no assistance, requires only that they who live under its protection should demean themselves as good citizens ...
"May the children of the stock of Abraham who dwell in this land continue to merit and enjoy the good will of the other inhabitants -- while every one shall sit in safety under his own vine and fig tree and there shall be none to make him afraid."
3. The Imam in charge of this project is the nicest guy you'd ever want to meet. Read about his past here: http://www.nytimes.com/2010/08/22/nyregion/22imam.html?_r=1
4. Around five dozen Muslims died at the World Trade Center on 9/11. Hundreds of members of their families still grieve and suffer. The 19 killers did not care what religion anyone belonged to when they took those lives.
5. I've never read a sadder headline in the New York Times than the one on the front page this past Monday: "American Muslims Ask, Will We Ever Belong?" That should make all of us so ashamed that even a single one of our fellow citizens should ever have to worry about if they "belong" here. http://www.nytimes.com/2010/09/06/us/06muslims.html
6. There is a McDonald's two blocks from Ground Zero. Trust me, McDonald's has killed far more people than the terrorists.
7. During an economic depression or a time of war, fascists are extremely skilled at whipping up fear and hate and getting the working class to blame "the other" for their troubles. Lincoln's enemies told poor Southern whites that he was "a Catholic." FDR's opponents said he was Jewish and called him "Jewsevelt." One in five Americans now believe Obama is a Muslim and 41% of Republicans don't believe he was born here.
8. Blaming a whole group for the actions of just one of that group is anti-American. Timothy McVeigh was Catholic. Should Oklahoma City prohibit the building of a Catholic Church near the site of the former federal building that McVeigh blew up?
9. Let's face it, all religions have their whackos. Catholics have O'Reilly, Gingrich, Hannity and Clarence Thomas (in fact all five conservatives who dominate the Supreme Court are Catholic). Protestants have Pat Robertson and too many to list here. The Mormons have Glenn Beck. Jews have Crazy Eddie. But we don't judge whole religions on just the actions of their whackos. Unless they're Methodists.
10. If I should ever, God forbid, perish in a terrorist incident, and you or some nutty group uses my death as your justification to attack or discriminate against anyone in my name, I will come back and haunt you worse than Linda Blair marrying Freddy Krueger and moving into your bedroom to spawn Chucky. John Lennon was right when he asked us to imagine a world with "nothing to kill or die for and no religion, too." I heard Deepak Chopra this week say that "God gave humans the truth, and the devil came and he said, 'Let's give it a name and call it religion.' " But John Adams said it best when he wrote a sort of letter to the future (which he called "Posterity"): "Posterity! You will never know how much it cost the present Generation to preserve your Freedom! I hope you will make a good use of it. If you do not, I shall repent in Heaven that I ever took half the Pains to preserve it." I'm guessing ol' John Adams is up there repenting nonstop right now.
Friends, we all have a responsibility NOW to make sure that Muslim community center gets built. Once again, 70% of the country (the same number that initially supported the Iraq War) is on the wrong side and want the "mosque" moved. Enormous pressure has been put on the Imam to stop his project. We have to turn this thing around. Are we going to let the bullies and thugs win another one? Aren't you fed up by now? When would be a good time to take our country back from the haters?
I say right now. Let's each of us make a statement by donating to the building of this community center! It's a nonprofit, tax-exempt organization and you can donate a dollar or ten dollars (or more) right now through a secure pay pal account by clicking here: http://www.cordobainitiative.org/?q=content/donate I will personally match the first $10,000 raised (forward your PayPal receipt to webguy@michaelmoore.com). If each one of you reading this blog/email donated just a couple of dollars, that would give the center over $6 million, more than what Donald Trump has offered to buy the Imam out. C'mon everyone, let's pitch in and help those who are being debased for simply wanting to do something good. We could all make a huge statement of love on this solemn day.
I lost a co-worker on 9/11. I write this today in his memory.
"The man who speaks of the enemy / Is the enemy himself."
-- Bertolt Brecht
OpenMike 9/11/10
Michael Moore's daily blog
I am opposed to the building of the "mosque" two blocks from Ground Zero.
I want it built on Ground Zero.
Why? Because I believe in an America that protects those who are the victims of hate and prejudice. I believe in an America that says you have the right to worship whatever God you have, wherever you want to worship. And I believe in an America that says to the world that we are a loving and generous people and if a bunch of murderers steal your religion from you and use it as their excuse to kill 3,000 souls, then I want to help you get your religion back. And I want to put it at the spot where it was stolen from you.
There's been so much that's been said about this manufactured controversy, I really don't want to waste any time on this day of remembrance talking about it. But I hate bigotry and I hate liars, and so in case you missed any of the truth that's been lost in this, let me point out a few facts:
1. I love the Burlington Coat Factory. I've gotten some great winter coats there at a very reasonable price. Muslims have been holding their daily prayers there since 2009. No one ever complained about that. This is not going to be a "mosque," it's going to be a community center. It will have the same prayer room in it that's already there. But to even have to assure people that "it's not going to be mosque" is so offensive, I now wish they would just build a 111-story mosque there. That would be better than the lame and disgusting way the developer has left Ground Zero an empty hole until recently. The remains of over 1,100 people still haven't been found. That site is a sacred graveyard, and to be building another monument to commerce on it is a sacrilege. Why wasn't the entire site turned into a memorial peace park? People died there, and many of their remains are still strewn about, all these years later.
2. Guess who has helped the Muslims organize their plans for this community center? The JEWISH COMMUNITY CENTER of Manhattan! Their rabbi has been advising them since the beginning. It's been a picture-perfect example of the kind of world we all want to live in. Peter Stuyvessant, New York's "founder," tried to expel the first Jews who arrived in Manhattan. Then the Dutch said, no, that's a bit much. So then Stuyvessant said ok, you can stay, but you cannot build a synagogue anywhere in Manhattan. Do your stupid Friday night thing at home. The first Jewish temple was not allowed to be built until 1730. Then there was a revolution, and the founding fathers said this country has to be secular -- no religious nuts or state religions. George Washington (inaugurated around the corner from Ground Zero) wanted to make a statement about this his very first year in office, and wrote this to American Jews:
"The citizens of the United States of America have a right to applaud themselves for having given to mankind examples of an enlarged and liberal policy -- a policy worthy of imitation. ...
"It is now no more that toleration is spoken of as if it were the indulgence of one class of people that another enjoyed the exercise of their inherent natural rights, for, happily, the Government of the United States, which gives to bigotry no sanction, to persecution no assistance, requires only that they who live under its protection should demean themselves as good citizens ...
"May the children of the stock of Abraham who dwell in this land continue to merit and enjoy the good will of the other inhabitants -- while every one shall sit in safety under his own vine and fig tree and there shall be none to make him afraid."
3. The Imam in charge of this project is the nicest guy you'd ever want to meet. Read about his past here: http://www.nytimes.com/2010/08/22/nyregion/22imam.html?_r=1
4. Around five dozen Muslims died at the World Trade Center on 9/11. Hundreds of members of their families still grieve and suffer. The 19 killers did not care what religion anyone belonged to when they took those lives.
5. I've never read a sadder headline in the New York Times than the one on the front page this past Monday: "American Muslims Ask, Will We Ever Belong?" That should make all of us so ashamed that even a single one of our fellow citizens should ever have to worry about if they "belong" here. http://www.nytimes.com/2010/09/06/us/06muslims.html
6. There is a McDonald's two blocks from Ground Zero. Trust me, McDonald's has killed far more people than the terrorists.
7. During an economic depression or a time of war, fascists are extremely skilled at whipping up fear and hate and getting the working class to blame "the other" for their troubles. Lincoln's enemies told poor Southern whites that he was "a Catholic." FDR's opponents said he was Jewish and called him "Jewsevelt." One in five Americans now believe Obama is a Muslim and 41% of Republicans don't believe he was born here.
8. Blaming a whole group for the actions of just one of that group is anti-American. Timothy McVeigh was Catholic. Should Oklahoma City prohibit the building of a Catholic Church near the site of the former federal building that McVeigh blew up?
9. Let's face it, all religions have their whackos. Catholics have O'Reilly, Gingrich, Hannity and Clarence Thomas (in fact all five conservatives who dominate the Supreme Court are Catholic). Protestants have Pat Robertson and too many to list here. The Mormons have Glenn Beck. Jews have Crazy Eddie. But we don't judge whole religions on just the actions of their whackos. Unless they're Methodists.
10. If I should ever, God forbid, perish in a terrorist incident, and you or some nutty group uses my death as your justification to attack or discriminate against anyone in my name, I will come back and haunt you worse than Linda Blair marrying Freddy Krueger and moving into your bedroom to spawn Chucky. John Lennon was right when he asked us to imagine a world with "nothing to kill or die for and no religion, too." I heard Deepak Chopra this week say that "God gave humans the truth, and the devil came and he said, 'Let's give it a name and call it religion.' " But John Adams said it best when he wrote a sort of letter to the future (which he called "Posterity"): "Posterity! You will never know how much it cost the present Generation to preserve your Freedom! I hope you will make a good use of it. If you do not, I shall repent in Heaven that I ever took half the Pains to preserve it." I'm guessing ol' John Adams is up there repenting nonstop right now.
Friends, we all have a responsibility NOW to make sure that Muslim community center gets built. Once again, 70% of the country (the same number that initially supported the Iraq War) is on the wrong side and want the "mosque" moved. Enormous pressure has been put on the Imam to stop his project. We have to turn this thing around. Are we going to let the bullies and thugs win another one? Aren't you fed up by now? When would be a good time to take our country back from the haters?
I say right now. Let's each of us make a statement by donating to the building of this community center! It's a nonprofit, tax-exempt organization and you can donate a dollar or ten dollars (or more) right now through a secure pay pal account by clicking here: http://www.cordobainitiative.org/?q=content/donate I will personally match the first $10,000 raised (forward your PayPal receipt to webguy@michaelmoore.com). If each one of you reading this blog/email donated just a couple of dollars, that would give the center over $6 million, more than what Donald Trump has offered to buy the Imam out. C'mon everyone, let's pitch in and help those who are being debased for simply wanting to do something good. We could all make a huge statement of love on this solemn day.
I lost a co-worker on 9/11. I write this today in his memory.
"The man who speaks of the enemy / Is the enemy himself."
-- Bertolt Brecht
Friday, September 3, 2010
Guilty, beyond a reasonable doubt?
(...since 1973, more than 130 death row inmates have been released after wrongful convictions.)
Davis Case Reignites Death Penalty Debate
Friday 03 September 2010
by: Yana Kunichoff, t r u t h o u t | Report
A federal judge in Georgia upheld the murder conviction of death row inmate Troy Davis last week, following a special evidentiary hearing that was ordered by the US Supreme Court to determine whether he was innocent.
The high court took the unusual step of directing the federal judge in charge of the case, US District Judge William Moore, to re-examine it after Davis and his lawyers presented evidence that the reliability of witness statements used by the prosecution was questionable.
Laura Moye, Death Penalty Abolition Campaign director at Amnesty International, called the Davis case, which has received international attention amid claims that an innocent individual may be executed, emblematic of a broken justice system.
"How could you have a system that would put human life on the line like that?" asks Moye about the strong possibility that Davis may be innocent.
Davis was convicted and sentenced to the death penalty for the 1989 shooting death of Savannah Police Officer Mark MacPhail. At issue in the trial is whether Davis was the individual who assaulted a homeless man outside a Burger King restaurant and then shot MacPhail, off duty at the time and working as a security guard, when he attempted to intervene.
The case against Davis was built primarily on eyewitness testimony, and since Davis' conviction, most non-police witnesses have retracted their evidence, saying it was given under duress.
One witness said he lied at the trial when he testified that Davis admitted to the killing, another said he heard another man admit to the crime, and others raised questions about the color of Davis' shirt on the night of the crime.
Of the two main witnesses testifying against Davis, one is the main alternative defendant.
Of the seven recantations, the judge hearing the case concluded that only one was credible. But, he said, it came from a witness who earlier testimony was "patently false," and was, therefore, not relevant to the conviction.
Despite these inconsistencies in witness accounts, Davis' conviction has been heard and upheld at every level of the state and federal court system.
According to Moye, "the leading cause for wrongful convictions is inaccurate and wrongful eyewitness identification."
Amnesty International figures calculate that, since 1973, more than 130 death row inmates have been released after wrongful convictions.
For Moye, "the only way to prevent the execution of an innocent person is to not entrust our government to make a decision about life and death." She advocates an end to the death penalty altogether, a goal the international declaration of human rights also calls for.
But for now, at least 16 deaths are scheduled for the next six months and, in California, Gov. Arnold Schwarzenegger has borrowed $64 million to build a new death row.
In April 2009, the 11th Circuit Court ruled to deny Davis' appeal to have the newest evidence heard by a jury, a ruling which prompted one of the judges, Rosemary Barkett, to say: "To executive Davis, in the face of a significant amount of proffered evidence that may establish his actual innocence, is unconscionable and unconstitutional."
As Davis' execution date approached, his lawyers called on the Supreme Court to reconsider the issue under a recent ruling, which allows inmates facing certain extraordinary circumstances to file an appeal even after the one-year statute of limitations deadline has expired.
Rather than hear the case, the Supreme Court transferred it to the federal judge, instructing him to "receive testimony and make findings of fact as to whether evidence that could not have been obtained at the time of trial clearly establishes [Davis'] innocence."
The case was heard by Moore, who has been a federal judge since 1994, and recently stepped down as chief judge for the Southern District of Georgia, choosing to remain on active judge duty rather than take senior status.
Moore issued a 174-page order, following the Supreme Court-suggested evidentiary hearing, finding that Davis is not innocent beyond proven doubt.
"This court concludes that executing an innocent person would violate the Eighth Amendment," the judge wrote. "However, Mr. Davis is not innocent."
The judge said that the new evidence, including the recantations, did not significantly change the balance of proof offered at the original trial. "While Mr. Davis's new evidence casts some additional, minimal doubt on his conviction, it is largely smoke and mirrors," Moore wrote.
"Not all recantations are created equal," Moore said, saying a reasonable juror was more likely to disregard the recantations rather than abandon earlier testimony.
An analysis by Amnesty International notes that the judge found, "most reasonable jurors" would still vote to convict Davis, but that this suggests some jurors would vote to acquit him. To pass a death sentence in Georgia, a unanimous jury is required.
The state of Georgia is likely to seek another execution date for Troy in the near future, according to activists from the Campaign Against the Death Penalty, though his lawyers are also expected to appeal the ruling.
"Troy may be on death row," said Davis' sister Martin Correia, "but he is innocent, and we're going to prove that."
Davis Case Reignites Death Penalty Debate
Friday 03 September 2010
by: Yana Kunichoff, t r u t h o u t | Report
A federal judge in Georgia upheld the murder conviction of death row inmate Troy Davis last week, following a special evidentiary hearing that was ordered by the US Supreme Court to determine whether he was innocent.
The high court took the unusual step of directing the federal judge in charge of the case, US District Judge William Moore, to re-examine it after Davis and his lawyers presented evidence that the reliability of witness statements used by the prosecution was questionable.
Laura Moye, Death Penalty Abolition Campaign director at Amnesty International, called the Davis case, which has received international attention amid claims that an innocent individual may be executed, emblematic of a broken justice system.
"How could you have a system that would put human life on the line like that?" asks Moye about the strong possibility that Davis may be innocent.
Davis was convicted and sentenced to the death penalty for the 1989 shooting death of Savannah Police Officer Mark MacPhail. At issue in the trial is whether Davis was the individual who assaulted a homeless man outside a Burger King restaurant and then shot MacPhail, off duty at the time and working as a security guard, when he attempted to intervene.
The case against Davis was built primarily on eyewitness testimony, and since Davis' conviction, most non-police witnesses have retracted their evidence, saying it was given under duress.
One witness said he lied at the trial when he testified that Davis admitted to the killing, another said he heard another man admit to the crime, and others raised questions about the color of Davis' shirt on the night of the crime.
Of the two main witnesses testifying against Davis, one is the main alternative defendant.
Of the seven recantations, the judge hearing the case concluded that only one was credible. But, he said, it came from a witness who earlier testimony was "patently false," and was, therefore, not relevant to the conviction.
Despite these inconsistencies in witness accounts, Davis' conviction has been heard and upheld at every level of the state and federal court system.
According to Moye, "the leading cause for wrongful convictions is inaccurate and wrongful eyewitness identification."
Amnesty International figures calculate that, since 1973, more than 130 death row inmates have been released after wrongful convictions.
For Moye, "the only way to prevent the execution of an innocent person is to not entrust our government to make a decision about life and death." She advocates an end to the death penalty altogether, a goal the international declaration of human rights also calls for.
But for now, at least 16 deaths are scheduled for the next six months and, in California, Gov. Arnold Schwarzenegger has borrowed $64 million to build a new death row.
In April 2009, the 11th Circuit Court ruled to deny Davis' appeal to have the newest evidence heard by a jury, a ruling which prompted one of the judges, Rosemary Barkett, to say: "To executive Davis, in the face of a significant amount of proffered evidence that may establish his actual innocence, is unconscionable and unconstitutional."
As Davis' execution date approached, his lawyers called on the Supreme Court to reconsider the issue under a recent ruling, which allows inmates facing certain extraordinary circumstances to file an appeal even after the one-year statute of limitations deadline has expired.
Rather than hear the case, the Supreme Court transferred it to the federal judge, instructing him to "receive testimony and make findings of fact as to whether evidence that could not have been obtained at the time of trial clearly establishes [Davis'] innocence."
The case was heard by Moore, who has been a federal judge since 1994, and recently stepped down as chief judge for the Southern District of Georgia, choosing to remain on active judge duty rather than take senior status.
Moore issued a 174-page order, following the Supreme Court-suggested evidentiary hearing, finding that Davis is not innocent beyond proven doubt.
"This court concludes that executing an innocent person would violate the Eighth Amendment," the judge wrote. "However, Mr. Davis is not innocent."
The judge said that the new evidence, including the recantations, did not significantly change the balance of proof offered at the original trial. "While Mr. Davis's new evidence casts some additional, minimal doubt on his conviction, it is largely smoke and mirrors," Moore wrote.
"Not all recantations are created equal," Moore said, saying a reasonable juror was more likely to disregard the recantations rather than abandon earlier testimony.
An analysis by Amnesty International notes that the judge found, "most reasonable jurors" would still vote to convict Davis, but that this suggests some jurors would vote to acquit him. To pass a death sentence in Georgia, a unanimous jury is required.
The state of Georgia is likely to seek another execution date for Troy in the near future, according to activists from the Campaign Against the Death Penalty, though his lawyers are also expected to appeal the ruling.
"Troy may be on death row," said Davis' sister Martin Correia, "but he is innocent, and we're going to prove that."
Wednesday, September 1, 2010
Obama is Muslim & Earth is Flat
Grand Old Islamophobes? Polls Show Widespread Republican Concerns Over Muslims -- And Obama
Evan McMorris-Santoro / Talking Points Memo
September 1, 2010
In a series of respected national polls this summer, great swaths of Republicans -- often encompassing the majority -- have shown themselves to be deeply worried about the prospect of Muslims gaining power in the U.S. and of President Obama's perceived connections to the faith. This isn't a fringy extreme or small but vocal minority. It's huge portions of the party that just recently was defending its use of the filibuster by pointing out all the Democrats who blocked Civil Rights legislation in the 1960s and pooh-poohed the idea of racial insensitivity among tea partiers. And now, lots and lots of Republicans across the nation are on the leading edge of an anti-Muslim paranoia that some U.S. allies abroad believe will harm American relations with the moderate Muslim world.
Meet the new Republican establishment: worried about Muslims, and worried even more that Obama might be one of them.
The biggest news from the August 19 Pew pollof national attitudes toward Obama was the huge jump in the number of Americans who now think Obama is a Muslim. Nearly a fifth of the population made the incorrect assumption about Obama's faith, a sizeable increase from the months after Obama was inaugurated. Among Republicans, the number was far higher. Thirty-one percent said Obama was a Muslim, and 39% said they didn't know what religion Obama practices.
Only 27% made the right choice and said Obama is a Christian. Twenty-seven percent is usually the kind of number associated with a fringe element. So what's the takeaway from Pew? Mainstream Republicans -- the ones who make up the bulk of the party -- at best doubt Obama's faith and at worst are completely wrong about it.
And to be a Muslim is not a good thing in the eyes of the Republican mainstream. More than 60% of Republicans surveyed by CBS last month had an unfavorable view of the faith, compared with 25% of Democrats and 39% of the total sample.
So the takeaway is this: a large chunk of Republicans think Obama is a Muslim, and more Republicans than not would say that being a Muslim is probably not a great character trait.
(Despite their trepidations about Obama's faith, however, Republican respondents to the Pew poll said Obama isn't using whatever religion they think he does have enough when making decisions. Forty percent of those surveyed said Obama relies "too little" on "religious beliefs to make policy decisions." Go figure.)
Earlier this week came a new poll from Newsweek, suggesting what all that mistaken belief in Obama's faith means for the majority of the GOP. A full 52% of Republicans surveyed by the magazine said Obama "probably" or "definitely sympathizes with the goals of Islamic fundamentalists who want to impose Islamic law around the world." Nearly 60% of GOP respondents said "Obama favors the interests of Muslim Americans over other groups of Americans."
The numbers are very different from those of other voting blocs. Just 9% of Democrats said Obama has favored Muslims in his policies (that's the kind of number we generally think of when we think of fringe) and the vast majority of independents (62%) think Obama has been even-handed when it comes to helping Muslims.
Of course, politicians of all stripes have been on the opposition side of the most visible debate about Islam at the moment, that being the planned Muslim community center in lower Manhattan. But it's not a stretch to say Republicans are leading the fight against the project. And, as the polling shows, it's no longer a question that the mainstream GOP is more worried about Islam than other political groups in America.
http://tpmdc.talkingpointsmemo.com/2010/09/grand-old-islamophobes-polls-show-widespread-republican-concern-over-muslims.php?emailed=true
Evan McMorris-Santoro / Talking Points Memo
September 1, 2010
In a series of respected national polls this summer, great swaths of Republicans -- often encompassing the majority -- have shown themselves to be deeply worried about the prospect of Muslims gaining power in the U.S. and of President Obama's perceived connections to the faith. This isn't a fringy extreme or small but vocal minority. It's huge portions of the party that just recently was defending its use of the filibuster by pointing out all the Democrats who blocked Civil Rights legislation in the 1960s and pooh-poohed the idea of racial insensitivity among tea partiers. And now, lots and lots of Republicans across the nation are on the leading edge of an anti-Muslim paranoia that some U.S. allies abroad believe will harm American relations with the moderate Muslim world.
Meet the new Republican establishment: worried about Muslims, and worried even more that Obama might be one of them.
The biggest news from the August 19 Pew pollof national attitudes toward Obama was the huge jump in the number of Americans who now think Obama is a Muslim. Nearly a fifth of the population made the incorrect assumption about Obama's faith, a sizeable increase from the months after Obama was inaugurated. Among Republicans, the number was far higher. Thirty-one percent said Obama was a Muslim, and 39% said they didn't know what religion Obama practices.
Only 27% made the right choice and said Obama is a Christian. Twenty-seven percent is usually the kind of number associated with a fringe element. So what's the takeaway from Pew? Mainstream Republicans -- the ones who make up the bulk of the party -- at best doubt Obama's faith and at worst are completely wrong about it.
And to be a Muslim is not a good thing in the eyes of the Republican mainstream. More than 60% of Republicans surveyed by CBS last month had an unfavorable view of the faith, compared with 25% of Democrats and 39% of the total sample.
So the takeaway is this: a large chunk of Republicans think Obama is a Muslim, and more Republicans than not would say that being a Muslim is probably not a great character trait.
(Despite their trepidations about Obama's faith, however, Republican respondents to the Pew poll said Obama isn't using whatever religion they think he does have enough when making decisions. Forty percent of those surveyed said Obama relies "too little" on "religious beliefs to make policy decisions." Go figure.)
Earlier this week came a new poll from Newsweek, suggesting what all that mistaken belief in Obama's faith means for the majority of the GOP. A full 52% of Republicans surveyed by the magazine said Obama "probably" or "definitely sympathizes with the goals of Islamic fundamentalists who want to impose Islamic law around the world." Nearly 60% of GOP respondents said "Obama favors the interests of Muslim Americans over other groups of Americans."
The numbers are very different from those of other voting blocs. Just 9% of Democrats said Obama has favored Muslims in his policies (that's the kind of number we generally think of when we think of fringe) and the vast majority of independents (62%) think Obama has been even-handed when it comes to helping Muslims.
Of course, politicians of all stripes have been on the opposition side of the most visible debate about Islam at the moment, that being the planned Muslim community center in lower Manhattan. But it's not a stretch to say Republicans are leading the fight against the project. And, as the polling shows, it's no longer a question that the mainstream GOP is more worried about Islam than other political groups in America.
http://tpmdc.talkingpointsmemo.com/2010/09/grand-old-islamophobes-polls-show-widespread-republican-concern-over-muslims.php?emailed=true
Tuesday, August 17, 2010
Tea Party RE: Net Neutrality, Unclear on the Concept...
Tea Partiers Say Net Neutrality Hurts Freedom
Evan McMorris-Santoro | August 16, 2010, 8:42AM
The tea party, a movement whose success on the grassroots level is in many ways attributable to the power of free and open Internet communications, is joining the growing conservative crusade against the FCC's plan to enforce net neutrality on internet service providers. According to one tea partier involved in the effort, the movement is opposing net neutrality because "it's an affront to free speech and free markets."
The push toward an Internet regulated by corporations rather than government seems to be a new part of the tea party agenda, with fears mounting that the Obama administration's push for net neutrality is, essentially, the next cap-and-trade, government health care takeover or any of the myriad other socialist plots of the past year and a half.
As The Hill's Sara Jerome reports, "35 Tea Party groups" across the country have joined a coalition of conservative groups calling on the FCC "not to boost its authority over broadband providers through a controversial process known as reclassification." The coalition recently sent a letter to the FCC calling on the government agency to keep its hand off the Internet.
One of the groups who signed the letter was the Fountain Hills Tea Party in Arizona. Like many, many grassroots tea party groups across the country, Fountain Hills has a Ning social networking site, as well as a more traditional homepage, both key to communicating with members. Supporters of net neutrality often suggest that it's smaller sites like these that would suffer the most under the tiered Internet plan ISPs are expected to establish if no government rules require them to treat all Internet traffic equally.
Much like the Netroots movement, the tea party's communication and information dissemination is fueled by online tools. In addition to Ning, tea partiers are avid tweeters, skypers, YouTubers and Facebookers. Yet their seeming embrace of an Internet divvied up and defined by corporate deals puts them at odds with their Internet-savvy colleagues on the left, who have clamored for net neutrality for years.
Peter Bordow, a leader of the Fountain Hills Tea Party, told me that he's not completely ready to make a firm judgment on net neutrality yet, but he leans toward opposing it. He has some experience with the issue, having provided Internet services to customers in the past. (The letter to the FCC is signed by Jeff Cohen, another leader of Fountain Hills. But Bordow told me that his group "did not, as an organization, sign any position or opinion letter of any kind regarding net neutrality.")
"To be completely honest, I have seen and heard fairly compelling arguments on both sides of this issue," he said Friday. "As a former ISP owner, and strong believer in the free market, I tend to oppose legislation that gives appointed bureaucrats the power to tell (and enforce) how companies design and deliver their services to their customers."
In an email, Bordow broke down his concerns as a web-friendly tea partier when it comes to net neutrality:
It is possible (and may in fact even be predictable) that this ability to selectively throttle traffic could be used to "unfairly" limit certain traffic (Internet destinations) to users. I just don't think it is the Government's responsibility (or within their enumerated powers) to legislate powers to appointed bureaucrats to decide "what is fair".
History shows us again and again that whenever the power to decide "what is fair" is given to Government officials and/or appointed bureaucrats, there is far more propensity and opportunity for abuse of this power. It is only when free citizens and the free market are able to flex their collective purchasing muscle that we can be sure that this power is not abused.
So there you have it: on balance, tea partiers would rather leave companies in charge of the Internet because, as Bordow says, that's safer than another government bureaucracy. Indeed, Jamie Radtke, a leader of the Virginia Tea Party Patriot Federation and another signatory on the letter, told The Hill's Jerome that the Obama administration push for net neutrality was the same kind of government encroachment the tea party movement opposes on fronts like health care and direct intervention in the economy. Radtke said to expect the tea party to become a vocal part of the opposition to net neutrality rules as the debate continues to heat up.
"I think the clearest thing is it's an affront to free speech and free markets," Radtke told the paper. "There are so many assaults on individual liberties -- the EPA, net neutrality, cap-and-trade, card-check; the list goes on -- that sometimes the Tea Party doesn't know where to start its battles."
Check out the letter sent to the FCC (as first published by The Hill) here:
http://www.scribd.com/mobile/documents/35854527
Evan McMorris-Santoro | August 16, 2010, 8:42AM
The tea party, a movement whose success on the grassroots level is in many ways attributable to the power of free and open Internet communications, is joining the growing conservative crusade against the FCC's plan to enforce net neutrality on internet service providers. According to one tea partier involved in the effort, the movement is opposing net neutrality because "it's an affront to free speech and free markets."
The push toward an Internet regulated by corporations rather than government seems to be a new part of the tea party agenda, with fears mounting that the Obama administration's push for net neutrality is, essentially, the next cap-and-trade, government health care takeover or any of the myriad other socialist plots of the past year and a half.
As The Hill's Sara Jerome reports, "35 Tea Party groups" across the country have joined a coalition of conservative groups calling on the FCC "not to boost its authority over broadband providers through a controversial process known as reclassification." The coalition recently sent a letter to the FCC calling on the government agency to keep its hand off the Internet.
One of the groups who signed the letter was the Fountain Hills Tea Party in Arizona. Like many, many grassroots tea party groups across the country, Fountain Hills has a Ning social networking site, as well as a more traditional homepage, both key to communicating with members. Supporters of net neutrality often suggest that it's smaller sites like these that would suffer the most under the tiered Internet plan ISPs are expected to establish if no government rules require them to treat all Internet traffic equally.
Much like the Netroots movement, the tea party's communication and information dissemination is fueled by online tools. In addition to Ning, tea partiers are avid tweeters, skypers, YouTubers and Facebookers. Yet their seeming embrace of an Internet divvied up and defined by corporate deals puts them at odds with their Internet-savvy colleagues on the left, who have clamored for net neutrality for years.
Peter Bordow, a leader of the Fountain Hills Tea Party, told me that he's not completely ready to make a firm judgment on net neutrality yet, but he leans toward opposing it. He has some experience with the issue, having provided Internet services to customers in the past. (The letter to the FCC is signed by Jeff Cohen, another leader of Fountain Hills. But Bordow told me that his group "did not, as an organization, sign any position or opinion letter of any kind regarding net neutrality.")
"To be completely honest, I have seen and heard fairly compelling arguments on both sides of this issue," he said Friday. "As a former ISP owner, and strong believer in the free market, I tend to oppose legislation that gives appointed bureaucrats the power to tell (and enforce) how companies design and deliver their services to their customers."
In an email, Bordow broke down his concerns as a web-friendly tea partier when it comes to net neutrality:
It is possible (and may in fact even be predictable) that this ability to selectively throttle traffic could be used to "unfairly" limit certain traffic (Internet destinations) to users. I just don't think it is the Government's responsibility (or within their enumerated powers) to legislate powers to appointed bureaucrats to decide "what is fair".
History shows us again and again that whenever the power to decide "what is fair" is given to Government officials and/or appointed bureaucrats, there is far more propensity and opportunity for abuse of this power. It is only when free citizens and the free market are able to flex their collective purchasing muscle that we can be sure that this power is not abused.
So there you have it: on balance, tea partiers would rather leave companies in charge of the Internet because, as Bordow says, that's safer than another government bureaucracy. Indeed, Jamie Radtke, a leader of the Virginia Tea Party Patriot Federation and another signatory on the letter, told The Hill's Jerome that the Obama administration push for net neutrality was the same kind of government encroachment the tea party movement opposes on fronts like health care and direct intervention in the economy. Radtke said to expect the tea party to become a vocal part of the opposition to net neutrality rules as the debate continues to heat up.
"I think the clearest thing is it's an affront to free speech and free markets," Radtke told the paper. "There are so many assaults on individual liberties -- the EPA, net neutrality, cap-and-trade, card-check; the list goes on -- that sometimes the Tea Party doesn't know where to start its battles."
Check out the letter sent to the FCC (as first published by The Hill) here:
http://www.scribd.com/mobile/documents/35854527
Tuesday, August 3, 2010
$19.4 Million in pay, $100k in fines for CitiBank Exec.
Where Are The Prosecutions?
SEC Lets Citi Execs Go Free After $40 Billion Subprime Lie
Saturday 31 July 2010
by: Zach Carter | AlterNet | News Analysis
What is the penalty for bankers who tell $40 billion lies? Somewhere between nothing and a rounding-error on your bonus.
The SEC just hit two Citigroup executives with fines for concealing $40 billion in subprime mortgage debt from investors back in 2007. The biggest fine is going to Citi CFO Gary Crittenden, who will pay $100,000 to settle allegations that he screwed over his own investors. The year of the alleged wrongdoing, Crittenden took home $19.4 million. That’s right. Crittenden will lose one-half of one percent of his income from the year he hid a quagmire of bailout-inducing insanity from his own investors. That’s it. No indictment. No prison time. Crittenden doesn’t even have to formally acknowledge any wrongdoing.
In 2007, as financial markets were freaking out about the subprime situation, Citi repeatedly told its investors that it owned just $13 billion in subprime mortgage debt. It was true—if you didn’t count an additional $40 billion in subprime debt that the company was also holding onto.
Citi’s CEO at the time, Chuck Prince, has not been charged with anything. As Yves Smith emphasizes, all of the top financial officers of every major corporation are responsible for the accuracy of their quarterly financial statements. Lying on those statements is a federal crime. This is the sort of thing that securities fraud cases are built around.
The SEC’s own statements about what went on at Citi are damning. If the agency can make this kind of information public, they ought to be pursuing criminal prosecutions. The SEC says that senior Citi management had been collecting information about the company’s subprime situation as early as April 2007, but repeatedly cited the $13 billion figure to investors over the next six months, waiting to acknowledge the additional $40 billion in subprime debt until November 2007. The SEC also says that Crittenden knew the “full extent” of Citi’s subprime situation by September at the latest, but the company continued to cite $13 billion in earnings reports through October.
Citi’s subprime shenanigans had consequences for taxpayers, pushing the company to the brink of total collapse and prompting one of the biggest bailouts of 2008.
Phil Angelides and the Financial Crisis Inquiry Commission deserve a lot of credit for highlighting the absurdity of Citi’s actions in a hearing on April 7 of this year (the key passage starts on page 368 of this pdf transcript). Angelides’ line of questioning revealed that even Citi’s board knew that the subprime exposure was much greater than what the company was claiming in public. Citi’s board at the time included Robert Rubin, former Treasury Secretary and architect of much of the deregulation that lead to the current crisis who took home $120 million for his work at Citi.
Either the SEC or the Justice Department could be pursuing criminal cases against Citi executives. What does it take to get the Justice Department’s attention on a financial fraud case? You have to launder $380 billion in drug money, and even then, DOJ lets you off with a slap on the wrist. The DOJ caught Wachovia doing just that, and the bank is getting off with a minor fine that won’t even make a dent in it’s second-quarter profits.
The Citi settlement is worse than a get-out-of-jail free card for Crittenden, Prince and their cohorts. The SEC actually fined Citi’s shareholders $75 million for the alleged wrongdoing of their executives. For some varieties of corporate misconduct, like Wachovia’s drug money laundering, hitting shareholders with the fine is appropriate. Wachovia’s money laundering operations directly enriched the company and its shareholders. This was not the case with Citi’s subprime scandal. Citi’s executives were hurting their own shareholders. Instead of meting out serious punishment to those executives, the SEC is fining Citi’s shareholders, the very people wronged in the incident.
This deference to the elites who wrecked the economy just keeps playing out. When Bank of America lied to its shareholders about billions of dollars in bonus payments it was about to make, the SEC decided to fine BofA shareholders and let the firm’s executives off the hook. The decision-makers at Wachovia who allowed the firm to funnel drug money despite repeated warnings by whistleblowers have not been indicted. Nobody at Washington Mutual has been indicted despite clear evidence of rampant mortgage fraud at the firm. Lehman Brothers’ repo 105 accounting scam is going unpunished, as are similar schemes at other banks including Bank of America. After much public relations flogging, the SEC let Goldman Sachs off easy.
More than 1,100 bankers went to jail in the aftermath of the savings and loan crisis. Massive financial crises simply do not occur without widespread fraud. The failure to prosecute that fraud poses systemic risks for the global economy. With too-big-to-fail behemoths dominating the financial landscape, the prospect of prison is the only serious check on executives interested in cannibalizing the economy for personal gain. If the SEC and the Department of Justice continue to let executives get away with outrageous acts without even taking the case to court, our financial system is doomed to repeat the same excesses and abuses we’ve seen over the past decade. If Crittenden did what the SEC claims he did, he screwed over his own investors and scored a huge bonus in the process. Everybody on Wall Street understands the implications: breaking the law is a great way to make a lot of money. When a class of elites can thumb its nose at the law with impunity, the result is not only a threat to the efficiency of our economy, but a threat to the basic functioning of our democracy.
Zach Carter is AlterNet's economics editor. He is a fellow at Campaign for America's Future, and a frequent contributor to The Nation magazine.
SEC Lets Citi Execs Go Free After $40 Billion Subprime Lie
Saturday 31 July 2010
by: Zach Carter | AlterNet | News Analysis
What is the penalty for bankers who tell $40 billion lies? Somewhere between nothing and a rounding-error on your bonus.
The SEC just hit two Citigroup executives with fines for concealing $40 billion in subprime mortgage debt from investors back in 2007. The biggest fine is going to Citi CFO Gary Crittenden, who will pay $100,000 to settle allegations that he screwed over his own investors. The year of the alleged wrongdoing, Crittenden took home $19.4 million. That’s right. Crittenden will lose one-half of one percent of his income from the year he hid a quagmire of bailout-inducing insanity from his own investors. That’s it. No indictment. No prison time. Crittenden doesn’t even have to formally acknowledge any wrongdoing.
In 2007, as financial markets were freaking out about the subprime situation, Citi repeatedly told its investors that it owned just $13 billion in subprime mortgage debt. It was true—if you didn’t count an additional $40 billion in subprime debt that the company was also holding onto.
Citi’s CEO at the time, Chuck Prince, has not been charged with anything. As Yves Smith emphasizes, all of the top financial officers of every major corporation are responsible for the accuracy of their quarterly financial statements. Lying on those statements is a federal crime. This is the sort of thing that securities fraud cases are built around.
The SEC’s own statements about what went on at Citi are damning. If the agency can make this kind of information public, they ought to be pursuing criminal prosecutions. The SEC says that senior Citi management had been collecting information about the company’s subprime situation as early as April 2007, but repeatedly cited the $13 billion figure to investors over the next six months, waiting to acknowledge the additional $40 billion in subprime debt until November 2007. The SEC also says that Crittenden knew the “full extent” of Citi’s subprime situation by September at the latest, but the company continued to cite $13 billion in earnings reports through October.
Citi’s subprime shenanigans had consequences for taxpayers, pushing the company to the brink of total collapse and prompting one of the biggest bailouts of 2008.
Phil Angelides and the Financial Crisis Inquiry Commission deserve a lot of credit for highlighting the absurdity of Citi’s actions in a hearing on April 7 of this year (the key passage starts on page 368 of this pdf transcript). Angelides’ line of questioning revealed that even Citi’s board knew that the subprime exposure was much greater than what the company was claiming in public. Citi’s board at the time included Robert Rubin, former Treasury Secretary and architect of much of the deregulation that lead to the current crisis who took home $120 million for his work at Citi.
Either the SEC or the Justice Department could be pursuing criminal cases against Citi executives. What does it take to get the Justice Department’s attention on a financial fraud case? You have to launder $380 billion in drug money, and even then, DOJ lets you off with a slap on the wrist. The DOJ caught Wachovia doing just that, and the bank is getting off with a minor fine that won’t even make a dent in it’s second-quarter profits.
The Citi settlement is worse than a get-out-of-jail free card for Crittenden, Prince and their cohorts. The SEC actually fined Citi’s shareholders $75 million for the alleged wrongdoing of their executives. For some varieties of corporate misconduct, like Wachovia’s drug money laundering, hitting shareholders with the fine is appropriate. Wachovia’s money laundering operations directly enriched the company and its shareholders. This was not the case with Citi’s subprime scandal. Citi’s executives were hurting their own shareholders. Instead of meting out serious punishment to those executives, the SEC is fining Citi’s shareholders, the very people wronged in the incident.
This deference to the elites who wrecked the economy just keeps playing out. When Bank of America lied to its shareholders about billions of dollars in bonus payments it was about to make, the SEC decided to fine BofA shareholders and let the firm’s executives off the hook. The decision-makers at Wachovia who allowed the firm to funnel drug money despite repeated warnings by whistleblowers have not been indicted. Nobody at Washington Mutual has been indicted despite clear evidence of rampant mortgage fraud at the firm. Lehman Brothers’ repo 105 accounting scam is going unpunished, as are similar schemes at other banks including Bank of America. After much public relations flogging, the SEC let Goldman Sachs off easy.
More than 1,100 bankers went to jail in the aftermath of the savings and loan crisis. Massive financial crises simply do not occur without widespread fraud. The failure to prosecute that fraud poses systemic risks for the global economy. With too-big-to-fail behemoths dominating the financial landscape, the prospect of prison is the only serious check on executives interested in cannibalizing the economy for personal gain. If the SEC and the Department of Justice continue to let executives get away with outrageous acts without even taking the case to court, our financial system is doomed to repeat the same excesses and abuses we’ve seen over the past decade. If Crittenden did what the SEC claims he did, he screwed over his own investors and scored a huge bonus in the process. Everybody on Wall Street understands the implications: breaking the law is a great way to make a lot of money. When a class of elites can thumb its nose at the law with impunity, the result is not only a threat to the efficiency of our economy, but a threat to the basic functioning of our democracy.
Zach Carter is AlterNet's economics editor. He is a fellow at Campaign for America's Future, and a frequent contributor to The Nation magazine.
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