March 16, 2009

Freedom Watch, the public interest group that investigates and prosecutes government corruption to promote and protect freedom, is filing an amended complaint against the Federal Reserve and the Department of the Treasury regarding the $700 billion dollar bailout of this country's prodigal corporate deadbeats, under the pretenses of the so-called "Emergency Economic Stabilization Act of 2008," Freedom Watch filed a FOIA request in December and again in February with these two agencies in order to obtain information relating to the bailout, specifically, who is deciding which companies should receive funds; how are the decisions being made; what documents are being submitted by these companies to justify assistance of them; and what are the names of all the companies receiving funds"

These are some basic questions to which Freedom Watch, on behalf of the American people, demands answers. The Bush Administration used fear-mongering and scare tactics to cow the public into listless obedience as they pushed through a bill in a matter of weeks that amounted to nothing more than subsidizing failure and rewarding rich Wall Street executives for making losing bets on an epic scale. Once the floodgates were opened up by Treasury Chairman Hank Paulson (Bush Administration), they have continued unabated under Tim Geithner (Obama Administration). It is helpful to look at these two individuals, Paulson and Geithner, to see what roles they played in this crisis, because this can offer insight into their subsequent actions.

Paulson was the CEO of Wall Street titan Goldman Sachs from 1998 to 2006, during which time he fostered a very special relationship with the Chinese government elite, visiting the country 70 times and no doubt encouraging them to invest in America through equity and debt ownership. During his tenure at Goldman and later as Treasury Chairman, he is best remembered for pushing for lower capital requirements for banks and less oversight, instead asserting in 2007 that, "An open, competitive, and liberalized financial market can effectively allocate scarce resources in a manner that promotes stability and prosperity far better than governmental intervention." One can only wonder if he still holds this same view in light of the economic disaster that has since befallen our country.

Tim Geithner has been involved in international trade and finance his entire life, his first notable experience being with Kissinger and Associates and then later in 1998 as Under Secretary of the Treasury for International Affairs where he served under then Treasury Secretary and close personal mentor Robert Rubin. If you recall, Rubin was an instrumental player along with Alan Greenspan in ensuring that derivatives markets remained free from government regulation, and he also worked for Goldman Sachs for 26 years before briefly serving as Chairman of Citigroup. Before Geithner's appointment by Obama, he headed up the largest of Federal Reserve banks, the New York Fed, beginning in 2003 and was also Vice Chairman of the Federal Open Market Committee, the private committee that dictates and manipulates monetary policy for the entire United States, God-like in its sway over world financial markets.

These two extremely influential and powerful individuals, Timothy Geithner and Henry Paulson, have been notable architects of US policy on regulation and oversight of financial markets, and therefore controlled the fate of all US companies by extension. They essentially created the market conditions that allowed companies to take enormous risks, thereby putting the entire US financial system in jeopardy. Whereas once, they represented financial interests in the private sphere and pushed the government for favorable policies from the outside, they later went on to become a part of that same public sphere, where they could directly set policy that would influence these same private interests they once represented. Once the system that they helped to create began to falter, they used their power as Treasury Secretary to inject hundreds of billions of dollars into these same institutions that they once were a part of.

Freedom Watch Chairman Larry Klayman states, "What we have in this country, is a confluence of the public and private sectors. The individuals at the upper echelons of the corporate world transfer seamlessly into the upper echelons of government and vice-versa. The conflict of interest is enormous, as those who were once lobbying for lax regulation and oversight, are now the ones charged with setting those same policies. Similarly, those companies that are now receiving hundreds of billions of bailout dollars are the same companies that were once headed by top administration officials. This is corrupt, this is shameful, and we, on behalf of the American people, are not going to take it lying down."