Congressional Leaders Stunned by Warnings

[kpete]

Source: New York Times

September 20, 2008
Congressional Leaders Stunned by Warnings
By DAVID M. HERSZENHORN

WASHINGTON — It was a room full of people who rarely hold their tongues. But as the Fed chairman, Ben S. Bernanke, laid out the potentially devastating ramifications of the financial crisis before congressional leaders on Thursday night, there was a stunned silence at first.

Mr. Bernanke and Treasury Secretary Henry M. Paulson Jr. had made an urgent and unusual evening visit to Capitol Hill, and they were gathered around a conference table in the offices of House Speaker Nancy Pelosi.

“When you listened to him describe it you gulped," said Senator Charles E. Schumer, Democrat of New York.

As Senator Christopher J. Dodd, Democrat of Connecticut and chairman of the Banking, Housing and Urban Affairs Committee, put it Friday morning on the ABC program “Good Morning America,” the congressional leaders were told “that we’re literally maybe days away from a complete meltdown of our financial system, with all the implications here at home and globally.”



Read more: http://www.nytimes.com/2008/09/20/washington/19cnd-cong.html?_r=2&hp=&adxnnl=1&oref=slogin&pagewanted=print&adxnnlx=1221873916-YPVGAOKEGdlqkapi11lHaQ

[LiberalFighter]

1. What were Bernanke and Paulson doing to prevent this mess?

Playing golf?

[roguevalley]

20. all of them are bastards on both sides of the table. they sat next to the time

bomb and ignored it. we're sitting all over the country with a modem and a laptop and we saw it coming a few years ago. Piss on them all.

[sattahipdeep]

41. What could you buy with $6 billion?

JOEL BRINKLEY

Sunday, May 18, 2008

You could finally rebuild the New Orleans neighborhoods that Hurricane Katrina destroyed. For almost six years, you could provide a daily meal for every one of the 36 million Americans who live below the poverty line.

Or, you could give all of it to the Pakistani government in the form of military aid and accomplish absolutely nothing. For more than seven years now, billions of American government dollars, expense reimbursements of about $90 million a month, have sluiced directly into the Pakistani Treasury, instantly becoming "sovereign government funds," as a new government report puts it.


Once there, the United States has no control over how the money is used. All of this money, about $6 billion so far, is intended to pay for counterinsurgency operations against al Qaeda and Taliban sanctuaries in the tribal areas of northwestern Pakistan.

After seven years, al Qaeda has established a terrorist-training and planning center there. The 2008 National Intelligence Estimate said al Qaeda "has regenerated its attack capability and secured a safe haven in Pakistan."

Meantime, the Taliban have begun applying fundamentalist Islamic law in the tribal areas they now control. They have shut down schools for girls, closed barbershops and music stores, just as they did in Afghanistan when they ruled that country. In short, seven years and $6 billion later, the terrorist group that carried out the 9/11 attacks has grown ever more comfortable and secure in its new Pakistani home. There, Washington fears, their leaders - including Osama bin Laden - are planning another attack on the United States. Meanwhile, the newly elected Pakistani government is negotiating a truce with these militants and has already pulled most of its troops from the area.


This information comes from newly published federal government reports.

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/05/18/INN110LIQ6.DTL

[Better Believe It]

43. And What Were The Democratic/Republican Party Leaders Doing To Prevent This Mess?

Tell me.

It seems this was a bi-partisan affair that started big time with the repeal of the Glass-Steagall_Act. Only 8 votes in the Senate against the language in the final repeal bill!

"The bill that ultimately repealed the Act was introduced in the Senate by Phil Gramm (R-TX) and in the House of Representatives by James Leach (R-IA) in 1999. The bills were passed by a 54-44 vote along party lines with Republican support in the Senate and by a 343-86 vote in the House of Representatives. Nov 4, 1999: After passing both the Senate and House the bill was moved to a conference committee to work out the differences between the Senate and House versions.

The final bill resolving the differences was passed in the Senate 90-8-1 and in the House: 362-57-15. This veto proof legislation was signed into law by President Bill Clinton on November 12, 1999."

http://en.wikipedia.org/wiki/Glass-Steagall_Act

[grannie4peace]

2. dis is serious shit, folks

[annabanana]

3. Why should they be believed?

What have they ever done to prove themselves trustworthy? How can they be taken at their word? We know what happens when we sit back and say to ourselves.."They would never lie about something that important"...

[MindMatter]

24. They should not be believed. This is their last hurrah

The fascists have been hard at work stealing money from the american people for 7 years. They can see that this could be the end of it. Even if they steal the Presidency, it is clear that they will have an even more Democratic Congress and a really, really pissed off public. So they have 90 days to grab all the cash they can before they lose control for probably 8 years. This is a looting, plain and simple.

[bbgrunt]

38. this whole mess reminds me of the

run up to Iraq. Nothing was done to prevent or mitigate the attacks on 9-11. Then, in a flurry of emergency hysteria we got the patriot act, the department of homeland security, the military commissions act, fisa, etc.

Now we are supposed to believe the same liars that control all the info......and Shumer gulped.

well, the final fleecing is about to begin.

[skooooo]

4. I'm going to ...

...keep hoping that they're wrong. Not much else to do at this point.

[Lebam in LA]

5. They gulped at the lies about Iraq too

Are the liars, lying again?
But then again alot of us saw this disaster coming and I have a feeling its going to get worse.

[WannaJumpMyScooter]

6. Like duh...a dummy like me knows these things

how can the great and powerful not?

Oh, yeah... just like the Iraq WMD, I forgot

[rurallib]

7. May be bad, but sure is reminiscent of Bush & Cheney going aftyer Iraq

hollering "Wolf! at every turn and scaring people to death so they could do just what they wanted.

[liberalmuse]

8. Is it time to stuff our mattresses?

It may be. I supposedly bank at the safest bank, but no bank is safe, really. I actually bank at two banks. What are DUer's planning on doing?

[Indenturedebtor]

9. Unless you're going to stuff it with gold it doesn't matter

If you can't afford gold then try Matzot and twinkies ;)

[Mari3333]

12. my financial advisor told me to sit tight

she says to sit tight, i would lose more in the long run if i reallocate my retirement funds because of capital gains tax. i guess just reallocating ones funds means the IRS can go after you. i lose either way it seems. this sucks.

[bemildred]

33. As long as it stays in a retirement account, there is no tax.

Capital gains or otherwise. You can do anything you like except take it out. Just saying ...

[crossroads]

22. I pulled our half of my savings today

and bought Silver!

CR

[ingac70]

10. Well goddamnit since they are nationalizing companies...

how about seizing one that actually makes a fucking profit, like Big Oil, and maybe we can stave some of this shit off.

[CrispyQ]

18. Best suggestion I've read all day!!

:thumbsup: :thumbsup:

[MindMatter]

31. I've been thinking Obama should propose exactly that

Well not in so many words, but how about if Obama said:

"America has serious energy problems. We need to ensure an adequate supply of gasoline while we make aggressive moves to develop the energy efficient technologies of the future. Because we have seen the enormous costs in lives and money of fighting wars for oil in the Middle East, we must wisely and carefully utilize the energy resources. There has been much talk about opening up additional offshore drilling here in the United states.

"Americans understand this need. But Americans do not understand why America should give up this resources at pennies on the dollar to big multi-national oil companies who have been making unprecedented profits selling OUR oil back to us at $4.00 a gallon.

"SO today I am proposing a new energy deal. We will open up significant new areas for drilling. However, this isn't the same old deal where the oil companies get rich and the American people get screwed. This time we're going to do it differently. The American people are going to retain ownership of our oil. We will HIRE the oil companies, to drill and process the oil for us. We will use a competitive bidding process that will have the strictest environmental requirements and will allow the winning bidder to make a fair return on the work they do for us. But the big profits will go to the American people. After all, it's OUR OIL. And one other thing, every drop of this oil will go to AMERICAN consumers."

The beauty of this tactic is that most Americans would say "Damn right. It's our oil". And the Republicans and their oil buddies would fight it like crazy.

[Fridays Child]

11. Does the inner sanctum finally care about what we "fundamentals" are going through?

Or are they still just feeling sorry for their Wall Street pals?

[wanpete]

13. Since we are buying this debt, we deserve to know exactly what was said

and what we are agreeing to buy and how bad it is. I'm so tired of being being told that washington knows better than me, and the "if you knew what we knew" you would make the same decisions. we have the right to know what this deal is before it is made and sealed. I'm getting really tired of this crap and tired of the crowd that sat around and watched this happen.

[Gin]

16. they better not raise my taxes to pay for this mess.....

bush had a disaster his first year...and a disaster his last year...he is a disaster.

[MindMatter]

23. They don't have to. Republicans have a better way.

It is called inflation. They have this group called the Federal Reserve Bank that is totally independent of the government. The FED -- and NOT the government -- can create any amount of money any time they damn well please and there is nothing any Senator, Congressman, or even President can do about it. When they put that money into circulation, that means that drives up inflation. That means any savings you have is devalued, just as sure as if you had a tax increase. That means your wages can't buy as many groceries, just as sure as if you had a tax increase. But it is totally outside of any government regulation. No Congressman ever votes on it.

Now in today's bailout scenario, apparently they are asking taxpayers to take over the bad loans -- basically just let all the crooks off the hook for all the bad loans they wrote, with no consequences. That probably will take an act of Congress, but because of the Shock Doctrine, we see that this administration has terrorized the Congress and convinced them that have to pass this legislation immediately without any hearings, without any reviews, without any testimony, without any criminal investigations, without any consideration of alternatives.

Oh, one more thing about inflation, many government programs, as well as private ones, are pegged to the Consumer Price Index (CPI). Government has a huge incentive to game that index to make it grossly under-represent the actual inflation.

[not fooled]

34. Yep.

Shock Doctrine in action. All evening the top-of-the-hour corporate media nooz has led with "* has plan to save economy" thereby implying that:

1. * has the solution and is interested in helping the country out of this mess. News even includes the chimptard stating something along the lines of "I am intervening because of the importance of these financial institutions to the average 'Murkan" thereby making it sound as though he is pushing this bailout to help the average citizen :rofl:

2. if the Dems don't just rush this through this weekend, no questions asked, they are the bad guys who will be at fault when the whole mess implodes

Me, I think they're just trying to hold everything together with bandaids and twine until after the election, to prevent the ignorant from figuring out just how much worse off they'd be with McCrap.

[rosesaylavee]

17. Well. Part of the reason they may not be spelling it out

as they may not want to start wide-spread panic in the markets and in the banks. I normally would agree with you 100% but this sounds like we are dancing on the edge of a razor here and will be needing a lot of luck to save our homes and savings.

[MindMatter]

26. The reasons for not spelling it out are:

1) it is a looting. If you spell it out, then people can start to follow the money to see who stands to profit from this trillion-dollar bailout.

2) it is precipitated by massive financial fraud. The more they talk about that, the more likely some of them could go to jail.

Isn't it interesting that throughout all this talk of all these "failed institutions" (actually plundered institutions) you never hear a single word about any criminal investigation? Why is that?

[wanpete]

27. I've considered your point and would agree with you. But we've seen this play before.

urgent need to make a major decision about something that is eminent. goes to congress late at night. decisions making after shocking information shared. no hearings, no information, no nothing. end result, massive screw up that leaves America in ruins, i e Iraq War.

I just don't trust them anymore and never will again.

[rosesaylavee]

42. I know... I was thinking about it this morning again.

And I have come around to your way of thinking. It needs to be completely aired. It is our money - we need to see it all - warts and all.

[Kool Kitty]

37. I agree. I am so sick of this

"behind closed doors" shit. If we are on the hook for this, tell us exactly what was said.

[seafan]

14. This reminds me of the mad rush to pass the IWR; the USA Patriot Act; FISA bill;

I fervently hope that this time, there is someone smart enough in Congress to get the details of Paulson's and Bernanke's plan before rubber stamping it.


Paulson Bailout Plan a Historic Swindle, The Nation, September 19, 2008



http://www.nytimes.com/2008/09/20/washington/19cnd-cong.html?_r=3&hp=&adxnnl=1&oref=slogin&pagewanted=print&adxnnlx=1221873916-YPVGAOKEGdlqkapi11lHaQ&oref=login">Congressional Leaders Stunned by Warnings, NYT, September 20, 2008

WASHINGTON — It was a room full of people who rarely hold their tongues. But as the Fed chairman, Ben S. Bernanke, laid out the potentially devastating ramifications of the financial crisis before congressional leaders on Thursday night (September 18), there was a stunned silence at first.

Mr. Bernanke and Treasury Secretary Henry M. Paulson Jr. had made an urgent and unusual evening visit to Capitol Hill, and they were gathered around a conference table in the offices of House Speaker Nancy Pelosi.

“When you listened to him describe it you gulped," said Senator Charles E. Schumer, Democrat of New York.

As Senator Christopher J. Dodd, Democrat of Connecticut and chairman of the Banking, Housing and Urban Affairs Committee, put it Friday morning on the ABC program “Good Morning America,” the congressional leaders were told “that we’re literally maybe days away from a complete meltdown of our financial system, with all the implications here at home and globally.”

.....

[lapfog_1]

15. Shock Doctrine... once more into the deep end. - n/t

[wanpete]

29. sadly, I won't count on it. Seeing Chris Dodd on Hardball today reminded me so much of how the Dems

looked when they were suckered into voting for the IWR. Information shared that was shocking and scary. Made a hasty decision that we will regret for eternity.

[Wilber_Stool]

19. Bull shit.

They just let this go on and on because nobody had the guts to make the tough decisions. The longer it went on, the fewer options were available until BOOM. Now there's only one thing that can be done.

[MindMatter]

21. This is just more of the Shock Doctrine

It is like the same bullshit when this same administration gave Congress all those dire warnings about WMDs, yellocake, mobile labs and so on. They create a moment of terror -- a shock, then they slam through the programs they want before Congress can assimilate what they have heard.

It is truly staggering at the chutzpah these guys have and it is staggering just how well the Shock Doctrine works. You would think that one or two Congressmen would stand up and cry "Bullshit! This problem didn't come up overnight and we don't have to transfer a trillion dollar problem to the taxpayers overnight without a single hearing." To be fair, Ron Paul and a couple other conservatives did say that. But for the rest of this mob to allow themselves to be herded up like sheep is disgraceful.

[Roland99]

25. Who stands to gain/lose the most

Too tightly involved with the entities at play

[MindMatter]

28. We don't know yet. That is the point.

When there are hundreds of billions of dollars created by the FED overnight, and hundreds of billions more in debt obligations transferred from supposedly bankrupt companies to the taxpayer, clearly there are people who are making out literally like bandits. We have a right to know what is happening here.

[judasdisney]

39. S - h - o - c - k -- D - o - c - t - r - i - n - e

is Tinfoil Conspiracy REALITY. Wake the FUCK UP, you DU pea-brains. The U.S. plutocrats like Kissinger, Cheney & a cast-of-thousands have already KILLED MILLIONS of peasants throughout Latin America merely for the benefit of U.S. corporations. This is not an exaggeration. It was a dress-rehearsal. Read the fucking book.

[mnhtnbb]

30. I stuck a toe in the market today. Bought more shares of international funds

I've had for several years.

[HuskiesHowls]

32. I have a plan for them:

We buy the bad assets for about 5 cents on the dollar, and if the bankers don't like that, they can keep the bad paper themselves, with one caveat: they don't get to foreclose on any bad loans. Otherwise, we ALL wind up buying up bad paper, the price of which has conveniently been inflated in the past couple days, and the bankers get to go home with their big paychecks again.

My plan is simple, easy to understand, and it seems that the losers would be the ones who are trying to screw us now. Unfortunately, its too simple, too straightforward, too easy to understand, so of course it will never happen.

[dakdirty]

35. Damn.

If any of you bastards had a real fucking job, you would have been shit-canned a long time ago. Hank, Ben; real bang-up job there, fellas!

[Trillo]

36. Well, at least the Democrats are on board with McCain's "FORCED"

comment. Gotta love the BiPartisanship when Corporate welfare is at stake!

[ohio2007]

40. they are all on the special interests take. They can't knee jerk finger point until

after the smoke clears. Taking a stand now may reflect negatively at the polls. so they STFU
/sarc

[SahaleArm]

44. This is being railroaded through like the Iraq War and the Patriot Act...

If Dodd didn't see this coming then he's an idiot; personally I think he's a liar in bed with the banking industry. Guess what folks the world won't end if the DOW goes back to 7500 or even 5000. This bill will be wealth distribution Republican style, socialize the losses. Don't kid yourself the fraudsters from Bernanke to Paulson to Rubin knew this was going to happen years ago. Now they are scaring the public in order to bail out their buddies on the street. They're going to try to inflate to get out of this mess and it will backfire as foreign debt holders will flee US-denominated bonds; then watch gold rise through the roof.

[LynnTheDem]

45. You did a heckuva job, Georgie bUshie!

You filthy sick stupid little tinpot "decider" MFer.

[bean fidhleir]

46. Terror! Terror! Give up your money now! Nobody's responsible, and we're all on the verge of ruin

Terror! Terror! Turn out your pockets, quick!! Don't stop to think, don't try to assess blame, don't do anything but be afraid.

[BeHereNow]

47. Transfer what ever assets you have out of the dollar NOW.

There fix is in- and now is the time to move
your assets out of the dollar.
BHN

[elleng]

48. To Starbucks???!!!

Coffee is good, eh? Or, too high?

[BeHereNow]

49. Sure- go for it.

And tell me later how your ignorance and arrogance worked out for you.
BHN

[elleng]

50. Seems to me

that you're the arrogant one.

Have any MORE ignorant remarks, BeHere?

[BeHereNow]

51. Hello? You started the "ignorant" aspect of dialogue. Starbucks? WTF does that mean?

How does it relate to what I posted?
Do tell the reason for your Starbux response, please, do.
BHN

[elleng]

52. Hello! It was a JOKE!

WHO's ignorant? Or is it just too self-involved to recognize a joke? Quick to call someone down suggests ignorance to me.

You suggested transferring assets out of u.s. dollars, right? I was in starbucks at the time, my few liquid assets (no pun intended) were in my wallet, so I suggested that I might transfer those into coffee at Starbucks.