Robert Reich discusses corporations as people

November 4, 2011 | By | 1 Reply More

“Corporations are not ‘people.’ I’ll believe corporations are ‘people’ when Texas and Georgia execute the next corporation…”

Robert Reich

(Reference: 6:00 on the above video)

Billionaire hedge fund operator Raj Rajaratnam was sentenced recently to 11 years for insider trading in a Manhattan federal court. Mr. Rajaratnam was convicted by a jury of 14 counts of insider trading for illegally conspiring to obtain and using insider information from individuals at Goldman Sachs, among others. Prosecutors argued that Rajaratnam made over $74 million from his scheme.

While some might praise the effort to convict Mr. Rajaratnam, how did the folks who he bribed or whatever fare? Why does the name Goldman Sachs keep coming up in all the Wall Street scandals? Did the government get anything from Goldman Sachs or any other bailout recipients for the money used to keep these operations alive? Just what the hell is Goldman Sachs still doing in any investment banking business at all?  Goldman Sachs and 3 other banks are still trading in the risky derivatives which brought down the financial markets in 2008. Goldman and the other 3 banks hold some 95% of those contracts.

In 2008, Goldman Sachs touted Greek and other troubled EU countries’ sovereign bonds even as manufactured schemes to hide the extent of those countries’ debts and was selling credit default swops (CDS) and other derivatives as bets against that same debt. One of the schemes was named “Aeolos” after the Greek god of the winds. It would appear that Goldman Sachs, perhaps among others, did with EU sovereign debt exactly what it did with sub-prime mortgage backed securities in the US. And see here, here, here and here.

Now, European sovereign debt finds itself and the countries’ which sold it pretty much in the same shape as the mortgage backed securities and housing markets in the US; sold out and worthless. The EU is about to set up its own TARP-style bailout of European countries (banks) much as was done in the US in 2008. The UK is doing a second round of quantitative easing to shore up its debt situation. The G20 nations are meeting in Cannes in southern France as this piece is written where the world’s markets are tottering at the thought of a Greek referendum on the austerity measures required to fund Greece’s operations past the end of the year. It is rumored the Greeks may drop their referendum idea but, I hope the Greeks sold the market short before announcing the referendum and made billions (and some more on bets when the market went back up some 200 points when the referendum idea was later abandoned the same day).  And see here and here.

The EU is about to do its version of a TARP-style bailout of the sovereign debt of Greece (then likely Italy, Ireland, Spain, and Portugal) where the banks are covered (either by the bailout or their credit default swops or both!) and Europe’s Middle Class, retirees and working poor citizens will likely pay to bail out the banks, the richest people and the richest countries. And contrary to the actual economic necessity of spending to expand the suffering nations’ economies, the EU will require viciously and crushingly extreme austerity measures to be adopted by all the countries receiving money in the bailout effort. It is no wonder the Greeks are in the streets and Slovakia initially balked at being the last EU member to approve the bailout. Goldman Sachs has won; it has completely privatized profits and socialized its risk-worldwide.

Some say Goldman profits are down. Bonuses will still be paid to the tune of $10 billion. The bonuses will still flow even though Goldman paid a record fine of $550 million to the US Securities and Exchange Commission for allegedly setting up a secret deal with a hedge fund and its mortgage backed securities which Goldman didn’t disclose to investors.

So, while billions of world’s citizens suffer, Goldman Sachs get to live on even after all the misery, destruction and havoc they have caused worldwide through their varied lies, deceptions and schemes of talking out both sides of their mouth about investments sold in the US and around the world.

If corporations are people, it’s time Goldman Sachs were charged with the illegal use of financial weapons of mass destruction, tried, and if convicted, dissolved.

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Category: Corporatocracy, Economy

About the Author ()

imothy E. Hogan is a trial attorney, a husband, a father of two awesome children and a practicing Roman Catholic in St. Louis, Missouri. Mr. Hogan has done legal and political work in Jefferson City, Missouri for partisan and non-partisan social change, environmental and consumer protection groups. Mr. Hogan has also worked for consumer advocate Ralph Nader in Washington, DC and the members of the trial bar in the State of New York. Mr. Hogan’s current interests involve remaining a full time solo practitioner pioneer on the frontiers of justice in America, a good husband and a good father to his awesome children.

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  1. Tim Hogan says:

    Mario Draghi has just left as governor of the Bank of Italy to head up the European Central Bank (ECB). Before his tenure at the BOI, Mr. Draghi was at Goldman Sachs. Perhaps Mr. Draghi will do better for the ECB than at the BOI, eh? I, er, mean, at taking care of Goldman Sachs that is. And so it goes.

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