Bush Treasury Secretary Henry Paulson concocted a neat little slight-of-hand to give 12.9 Billion of our tax dollars to Goldman Sachs... and we citizen taxpayers got nothing in return.
The story involves the actions Treasury Secretary Hank Paulson (Chairman and CEO, Goldman Sachs, 1998 - 2006) takes when the financial crisis hits. The first things he does is to let Bear Stearns and Lehman Brothers, the biggest competitors to Goldman Sachs, fail. The day after Lehman Brothers goes belly up, Paulson is in a meeting to decide whether to let AIG fail. The only banker at the meeting is Lloyd Blankfein, the Chairman and CEO of Goldman Sachs. They decide to save AIG with a huge injection of cash, 85 Billion Dollars of our tax moneys. Of that 85 Billion Dollars, the biggest payout from AIG goes to Goldman Sachs for 12.9 Billion Dollars. Goldman Sachs is not required to pay this money back to anyone AND the U.S. taxpayer who ponies up the 12.9 Billion Dollars receives nothing in return, not even seat on the board. Paulson neatly takes out Goldman Sachs' competitors AND gives the company 12.9 Billion Dollars of OUR money.
It's a nice crime when you can get away with it. It even gets better than this. Pauls0n appoints Neel T. Kashkari, a former Vice President of Goldman Sachs, the head of TARP. One of the first things Kashkari does is to make Goldman Sachs a bank holding company so that it can get money from the Fed at the discount window, FDIC money, and TARP money. Goldman Sachs allegedly needs to be saved. (From whom, we wonder?)
It's a pretty sleazy conspiracy. If it was done by a bunch of mid-level bureaucrats in Chicago, the finance cops would be on them like flies on a deer squished on the road. But no, these are the top elites...
They have stolen our money, put competitors out of business, and changed federal rules to benefit themselves.
These are crimes.
What's especially galling is a quote in an article today on Yahoo from Reuthers:
"Former U.S. Treasury Secretary Henry Paulson talked often to the head of Goldman Sachs at the height of the credit crisis but did not actively seek to help the bank he once ran, a spokeswoman for Paulson said on Saturday." That's a blatant lie.
The article continues: "The New York Times on Saturday reported records of two dozen conversations between Paulson and Goldman chief executive Lloyd Blankfein the same week last September that rival bank Lehman Brothers collapsed and insurer American International Group -- closely connected to Goldman -- was rescued with public funds.
"Goldman was the single biggest beneficiary of the AIG bailout, receiving nearly $13 billion in counterparty payments that would have been lost had the insurer failed.
"Paulson's spokeswoman Michele Davis confirmed the telephone conversations with Blankfein took place but denied Paulson had any intention of helping Goldman specifically."
Hmmm… roughly 15% of the payout goes right to Goldman Sachs. Nice if you can take people's money and then launder it right in front of their eyes.
The article goes on to say that "at a July 16 congressional hearing, lawmakers angrily asked Paulson to explain changes in U.S. policy during the crisis and said he had conflicts of interest in decisions involving Wall Street firms." Nice questions.
Paulon's response? "I operated very consistently within the ethics guidelines I had."
The trouble is... the only ethical guidelines Paulson had were the guidelines required amongst thieves to steal 12.9 Billion Dollars of our money and to knock out firms competing with Goldman Sachs.
This guy needs to be prosecuted for conspiracy to steal our money. How can we do that?