Under pressure from the U.S. and agrochemical industry lobbyists and amid ongoing negotiations for a controversial trade deal, the European Union dropped planned rules that could have led to the banning of 31 pesticides containing hazardous chemicals, a new investigative report has revealed.
The probe, led by the Brussels-based research and watchdog group Corporate Europe Observatory (CEO) and French journalist Stephane Horel, exposes how corporate lobby groups like the American Chemistry Council, CropLife America, and the American Chambers of Commerce, mobilized to stop the EU from taking action on hormone (endocrine) disrupting chemicals (EDCs)—known to have significant health and environmental impacts.
“Hundreds of documents … show unambiguously how science is being manipulated to defend vested interests, manufacture doubt and delay a pioneering regulation.”
—Nina Holland, Corporate Europe Observatory
According to the report—titled A Toxic Affair: How the Chemical Lobby Blocked Action on Hormone Disrupting Chemicals (pdf)—the examination of evidence “sheds light on how corporations and their lobby groups have used numerous tactics from the corporate lobbying playbook: scaremongering, evidence-discrediting, and delaying tactics as well as the ongoing [TransAtlantic Trade and Investment Partnership, or TTIP] negotiations as a leverage.”
Specifically, the Guardian reports: “Draft EU criteria could have banned 31 pesticides containing endocrine disrupting chemicals (EDCs). But these were dumped amid fears of a trade backlash stoked by an aggressive US lobby push.”
The newspaper adds:
On the morning of 2 July 2013, a high-level delegation from the US Mission to Europe and the American Chambers of Commerce (AmCham) visited EU trade officials to insist that the bloc drop its planned criteria for identifying EDCs in favour of a new impact study. By the end of the day, the EU had done so.
The TTIP is a corporate-friendly trade deal, currently being negotiated between the U.S. and the European Union, that is already opposed by environmental, food safety, and labor groups for its lack of transparency, corporate concessions, and negative implications for people and the planet.
Common Dreams has previously reported on efforts by pesticide lobby groups to use ongoing trade negotiations to align regulatory standards by lowering them to U.S. levels rather than increasing them to the stronger safeguards in the E.U.
The new revelations only add fuel to the fire.
“This is yet further evidence that the European Commission is more than willing to trade off, weaken, or delay much needed regulation and protections for the sake of completing this TTIP trade deal,” Samuel Lowe, of Friends of the Earth, told The Independent.
“This investigation tells the story of a major ongoing lobbying battle,” added Nina Holland, CEO campaigner and co-author of the Toxic Affair report. “Hundreds of documents released by the European Commission following freedom of information requests show unambiguously how science is being manipulated to defend vested interests, manufacture doubt and delay a pioneering regulation.”
EU proposals to regulate hormone-damaging chemicals linked to cancer, fertility problems and diabetes were allegedly dropped following pressure from US trade officials amid talks on the controversial Transatlantic Trade and Investment Partnership (TTIP).
Draft EU criteria could have banned some 31 pesticides containing dangerous endocrine disrupting chemicals (EDCs), but according to documents obtained by Pesticides Action Network (PAN) Europe and cited by The Guardian, they were cast aside amid fears of a trade backlash by a powerful US lobby.
According to the report, a high-ranking delegation from the US Mission to Europe and the American Chambers of Commerce (AmCham) visited European Union trade officials in July 2013 in a bid to urge the EU to drop its planned criteria for identifying EDCs in favor of a new impact study. The TTIP trade deal was at stake, and the EU allegedly agreed to the US demands.
TTIP is a highly controversial proposed EU-US free trade treaty that has been criticized for its secretiveness and lack of accountability.
AmCham representatives allegedly “complained about the uselessness of creating categories and thus, lists” of prohibited substances. The US trade representatives reportedly suggested taking a risk-based approach to regulation, and “emphasized the need for an impact assessment” instead.
The secretary-general of the commission, Catherine Day, allegedly sent a letter to the environment department’s director, Karl Falkenberg, telling him to drop the draft criteria, suggesting that “as other DGs [directorate-generals] have done, you consider making a joint single impact assessment to cover all the proposals” instead.
“We do not think it is necessary to prepare a commission recommendation on the criteria to identify endocrine disrupting substances,” she allegedly wrote.
The result, according to The Guardian, was that legislation planned for 2014 was “kicked back until at least 2016, despite estimated health costs of €150bn per year in Europe from endocrine-related illnesses such as IQ loss, obesity and cryptorchidism – a condition affecting the genitals of baby boys.”
On top of this, ahead of the meeting, AmCham had allegedly warned the EU of “wide-reaching implications” if the draft criteria came to be approved. According to The Guardian, AmCham wanted an EU impact study to set looser thresholds for acceptable exposure to endocrines, based on a substance’s potency.
Bas Eickhout, a Green member of the European Parliament, told The Guardian : “These documents offer convincing evidence that TTIP not only presents a danger for the future lowering of European standards, but that this is happening as we speak.”
The Environmental Audit Committee (EAC) of the UK House of Commons is currently carrying out an inquiry into the proposed TTIP and its impacts on the environment and the developing world.
“We are very concerned that the US government has a long history of lobbying against EU action on chemicals, and that TTIP could provide a method for them to institutionalise this,” EAC wrote in January, adding that the US approach to chemicals regulation is generally acknowledged to be “outdated and ineffective.”
“Our strong belief that the inclusion of chemicals within TTIP will lower protection in the EU, and will further slowdown efforts to protect human health and the environment from hazardous chemicals,” the committee warned.
Earlier this year, CHEM Trust (a UK charity whose aim is to prevent manmade chemicals from causing long-term damage to wildlife or humans) and around 150 other civil society groups signed up to a joint statement against regulatory cooperation in TTIP.
“Civil society groups denounce ‘regulatory cooperation’ in the TTIP negotiations as a threat to democracy and an attempt to put the interests of big business before the protection of citizens, workers and the environment,” the statement said.
According to the State of the Science of Endocrine Disrupting Chemicals 2012 report, many endocrine-related diseases and disorders are currently on the rise. Global rates of endocrine-related cancers (breast, endometrial, ovarian, prostate, testicular and thyroid) have been increasing over the past 40-50 years, researchers say.
“Close to 800 chemicals are known or suspected to be capable of interfering with hormone receptors, hormone synthesis or hormone conversion. However, only a small fraction of these chemicals have been investigated in tests capable of identifying overt endocrine effects in intact organisms,” the report stated.
Scientists warn that while numerous laboratory studies support the idea that chemical exposures contribute to endocrine disorders in humans, the “most sensitive window of exposure to EDCs is during critical periods of development, such as during fetal development and puberty.”
Four major banks—Citigroup, JPMorgan Chase, Barclays, and the Royal Bank of Scotland—have agreed to plead guilty in a Connecticut federal court to conspiring to manipulate the price of U.S. dollars and euros exchanged in the foreign currency market. But instead of sending those responsible for the crimes to prison, various government entities are fining the institutions a total of about $5.5 billion, the cost of which the banks will pass on to shareholders.
“For more than five years, traders in ‘The Cartel’ used a private electronic chat room to manipulate the spot market’s exchange rate between euros and dollars using coded language to conceal their collusion,” Attorney General Loretta Lynch said in announcing the settlements Wednesday morning.
In one of the chatroom conversations, a Barclays employee said: “If you ain’t cheating, you ain’t trying.”
Lynch said the currency manipulation “inflated the banks’ profits while harming countless consumers, investors and institutions around the globe — from pension funds to major corporations, and including the banks’ own customers.”
The Justice Department also announced that a fifth bank, Switzerland’s UBS, pleaded guilty to manipulating the London Interbank Offered Rate (LIBOR) and will pay a total of $545 million in fines, according to USA Today.
Legally, guilty pleas such as these would mean the banks would be restricted from conducting certain kinds of business, according to ThinkProgress. However the banks, as they have consistently in the past in other cases, received waivers from the Securities and Exchange Commission to continue business as usual.
The settlement by Lynch’s Justice Department follows the pattern of her predecessor, Eric Holder, who was criticized for not punishing Wall Street enough for its greedy and reckless behavior that caused the 2008 financial crisis.
To Learn More:
Banks to Pay Billions to Settle Charges (by Lorraine Bailey and Dan McCue, Courthouse News Service )
5 Banks Guilty of Rate-Rigging, Pay More than $5B (by Kevin McCoy and Kevin Johnson, USA Today )
Rigging of Foreign Exchange Market Makes Felons of Top Banks (by Michael Corkery and Ben Protess, New York Times )
Megabanks Fined $2 Billion For Criminal Activity, Will Be Able To Continue Business As Usual (by Alan Pyke, ThinkProgress )
Five Major Banks Agree to Parent-Level Guilty Pleas (U.S. Department of Justice)
Big Banks Fined Billions in Foreign Currency Scandal (by Noel Brinkerhoff, AllGov )
World’s Biggest Banks in Fresh Crosshairs of U.S. Justice Department…But Will Anyone Go to Jail? (by Noel Brinkerhoff, AllGov )
It took two seconds for a Cleveland police officer to shoot and kill 12-year-old Tamir Rice for playing with a pellet gun, claiming he was in fear for his life.
It took another week for police to charge the boy with “aggravated menacing” and “inducing panic,” according to documents published today by the Daily Kos.
But even six months after the controversial shooting that was captured on surveillance video last November, investigators have yet to interview the cop who shot and killed him, a man named Timothy Loehmann who has a history of emotional instability and disciplinary problems.
A man who should have never been hired.
However, that hasn’t stopped Loehmann and his partner, Frank Garmback, from asking a judge to delay a lawsuit filed by Rice’s family until after the “pending investigation” is complete.
Not that they’re doing anything to help that investigation along, refusing to speak to investigators about it.
Nevertheless, the Cuyahoga County Sheriff’s Office, which is handling the investigation, says it is almost done.
According to CNN:
Sheriff Clifford Pinkney provided what he said was a timeline of the investigation, which his department took over in December before beginning its investigation “in earnest” in mid-February. He told reporters that he and his investigators had resolved to leave “zero stones unturned” when the investigation is handed to prosecutors.
The Gray family’s legal team criticized what it said was the torpid pace of the investigation and said the drawn-out process is fueling suspicions that a coverup is in the works.
“It’s been now spanning three seasons, going up on 6 months, and sometimes justice requires just a little more diligence,” family attorney Walter Madison said. “What can be taking so long when you have the entire event there on video? A crime fighter’s dream.”
It is obvious that investigators are doing their usual coverup to protect themselves from any liability, trying to paint Rice as a dangerous menace to society when he was just a kid playing with a toy gun.
The real menace was the cop they hired, as Cleveland.com reported two weeks after the shooting.
A Nov. 29, 2012 letter contained in Tim Loehmann’s personnel file from the Independence Police Department says that during firearms qualification training he was “distracted” and “weepy.”
“He could not follow simple directions, could not communicate clear thoughts nor recollections, and his handgun performance was dismal,” according to the letter written by Deputy Chief Jim Polak of the Independence police.
The letter recommended that the department part ways with Loehmann, who went on to become a police officer with the Cleveland Division of Police.
“I do not believe time, nor training, will be able to change or correct the deficiencies,” Polak said.
Loehmann was forced to resign from the Independence Police Department in December 2012. He was then hired by the Cleveland Police Department in March 2014, which claims they never reviewed his personnel file, essentially placing the public at risk by handing him a badge and a gun.
Seconds after he shot Rice, his partner, Garmback, tackled the boy’s 14-year-old sister, who was running towards her brother, handcuffing her before stuffing her in the back of a patrol car.
Meanwhile, both cops did nothing to save the boy’s life.
Scottish Nationalists are hoping to use their new-found parliamentary leverage to block controversial Tory plans to introduce legislation that would see the further erosion of privacy rights across the UK.
As the first days of parliament get under way, Scottish Nationalist Party (SNP) MPs are planning to rail against Tory plans to revive a Data Communications Bill dubbed the Snoopers’ Charter.
SNP leader Nicola Sturgeon’s Westminster MPs plan to achieve this goal by lobbying moderate Tories, who previously opposed Home Secretary Theresa May’s surveillance agenda.
Among the Conservatives that Sturgeon’s party could court is David Davis, a senior Conservative backbencher who triggered a by-election in 2008 over Tory plans to introduce a policy shift that would see terror suspects detained for up to 42 days without trial.
Speaking to the Telegraph on Tuesday, an SNP MP said surveillance falls into a “tricky civil liberties space for the Conservatives where there are fault lines.
“We think the mass collection of data is wrong. There is a line beyond which it is unacceptable for civil liberties can be impinged,” he added.
On Friday, Home Secretary Theresa May told the BBC that ramped up surveillance powers are a “key example” of Tory policy that was blocked by the Liberal Democrats during the previous parliament.
May’s announcement angered privacy rights campaigners who warn of the erosion of civil liberties in an era of mass surveillance.
The Snoopers’ Charter would pave the way for internet and mobile phone firms to retain records of customers’ online browsing habits, use of social media, emails, text messaging and voice calls.
In a climate of increased terror threats, the Conservatives argue it would aid British security officials in monitoring online activity and protect the national interest in the process.
However, the European Court of Justice ruled against the legislation last April, warning it would result in human rights violations. The Court outlined a more moderate data retention program at the time that would aid criminal investigations.
Nevertheless, in July 2014 it emerged the government was seeking to push through emergency legislation, which would flout the Court’s judgment and re-legislate for the blanket retention of data.
As a single majority government – in the absence of the Liberal Democrats – the Conservatives are expected to ramp up online surveillance powers quickly.
The SNP’s opposition to these plans will likely be mirrored by Labour and the Lib Dems. Should a few dozen Conservative MPs back their thinking, May’s plans to revive the Snoopers’ Charter could be blocked.
Speaking to RT on Tuesday, Privacy International’s Legal Director Carly Nyst said the Snoopers’ Charter would give UK authorities some of the “broadest spying powers imaginable.
“These powers are nothing short of blanket, suspicionless surveillance of everyone who uses the internet,” she said.
“Should the Snoopers’ Charter be made law, Britons can expect to have every single website they visit, late night phone call they make and embarrassing Google search they enter logged and retained for 12 months,” she added.
On the question of whether SNP MPs would succeed in blocking the Snoopers’ Charter, Nyst predicted the party’s opposition to the legislation would prove troublesome for May.
“The government has declared its strong intention to see this legislation through; however, it must first overcome strong opposition, not only from the SNP, but from ordinary people across the country,” she said.
“It seems clear that the government is going to have a tough time selling to the British people the falsehood that in order for police in this country to do their job, the government needs to completely erode online privacy and expression.”
Privacy rights & privacy wrongs
Prior to the general election, Britain’s Open Rights Group lobbied stringently for parliamentary candidates to radically reform Britain’s mass surveillance policies.
They demanded the incoming government alter the legal framework governing surveillance to protect citizens from intelligence agencies’ routine snooping.
The group’s Executive Director Jim Killock told the Guardian last month he believes privacy rights could be nullified within a decade if the Conservatives and Labour don’t pursue a different approach to surveillance.
Killock also noted that NSA whistleblower Edward Snowden’s revelatory disclosures on GCHQ mass surveillance had little impact on snooping policy from London to Washington.
Classified US documents leaked by Snowden in 2013 caused international outrage when they uncovered the invasive nature of joint UK-US surveillance programs.
The NSA whistleblower’s disclosures revealed US and UK authorities’ ongoing scrutiny of Britons’ email activity, social network records, web browsing history and mobile phone data.
Tory plans to ramp up mass surveillance in Britain come almost 12 months after a poll revealed widespread opposition to state-sponsored snooping in Britain.
The research revealed the vast majority of those surveyed thought that citizens’ financial, medical, and credit information should remain private.
It also showed an overwhelming majority believed web browsing, mobile phone, telephone and email records should remain beyond the gaze of snoops.
This week the Sixth Circuit Court of Appeals ruled that the NSA’s metadata collection program was not authorized in US law. The PATRIOT Act, under which the program began, was too vague, the court found. But the truth is the Act was intended to be vague so that the government could interpret it in the broadest possible way.
But this is really more of a technicality, because illegality and unconstitutionality are really two very different things. Even if Congress had explicitly authorized the government to collect our phone records, that law would still be unconstitutional because the Constitution does not grant government the power to access our personal information without a valid search warrant.
Even though the court found the NSA program illegal, it did not demand that the government stop collecting our information in this manner. Instead, the court kicked the ball back in Congress’ court, as these provisions of the PATRIOT Act are set to expire at the end of the month and the Appeals Court decided to let Congress decide how to re-authorize this spying program.
Unfortunately, this is where there is not much to cheer. If past practice is any lesson, Congress will wait until the spying program is about to expire and then in a panic try to frighten Americans into accepting more intrusions on their privacy. Senate Majority Leader Mitch McConnell has already put forth a new bill as a stop-gap measure to allow time for a fuller debate on the issue. His stop-gap? A five year re-authorization with no changes to the current program!
The main reform bill being floated, the FREEDOM Act, is little better. Pretending to be a step in the right direction, the FREEDOM Act may actually be worse for our privacy and liberties than the PATRIOT Act!
One silver lining in the court decision is that it should exonerate Ed Snowden, who risked it all to expose what the courts have now found was illegal US government activity. That is the definition of a whistleblower. Shouldn’t he be welcomed back home as a hero instead of being threatened with treason charges? We shouldn’t hold our breath!
This week Snowden addressed a conference in Melbourne, Australia, informing citizens that the Australian government watches all its citizens “all the time.” Australia’s program allows the government to “collect everyone’s communications in advance of criminal suspicion,” he told the conference. That means the government is no longer in the business of prosecuting crimes, but instead is collecting information in case crimes someday occur.
How is it that the Australian government can collect and track “pre-crime” information on its citizens? Last month Australia passed a law requiring telecommunications companies to retain metadata information on their customers for two years.
Why do Australia’s oppressive laws matter to us? Because the NSA “reform” legislation before Congress, the FREEDOM Act, does exactly what the Australian law does: it mandates that US telecommunications companies retain their customers’ metadata information so that the NSA can access the information as it wishes.
Some argue that this metadata information is harmless and that civil libertarians are over-reacting. But, as Ed Snowden told the Melbourne conference, “under these mandatory metadata laws you can immediately see who journalists are contacting, from which you can derive who their sources are.”
This one example of what happens when the government forces corporations to assist it in spying on the people should be a red flag. How can an independent media exist in the US if the government knows exactly whom journalists contact for information? It would be the end of any future whistleblowers.
The only reform of the PATRIOT Act is a total repeal. Accept nothing less.
Police officers are more likely to be struck by lightning than be held financially accountable for their actions.—Law professor Joanna C. Schwartz (paraphrased)
“In a democratic society,” observed Oakland police chief Sean Whent, “people have a say in how they are policed.”
Unfortunately, if you can be kicked, punched, tasered, shot, intimidated, harassed, stripped, searched, brutalized, terrorized, wrongfully arrested, and even killed by a police officer, and that officer is never held accountable for violating your rights and his oath of office to serve and protect, never forced to make amends, never told that what he did was wrong, and never made to change his modus operandi, then you don’t live in a constitutional republic.
You live in a police state.
It doesn’t even matter that “crime is at historic lows and most cities are safer than they have been in generations, for residents and officers alike,” as the New York Times reports.
What matters is whether you’re going to make it through a police confrontation alive and with your health and freedoms intact. For a growing number of Americans, those confrontations do not end well.
As David O. Brown, the Dallas chief of police, noted: “Sometimes it seems like our young officers want to get into an athletic event with people they want to arrest. They have a ‘don’t retreat’ mentality. They feel like they’re warriors and they can’t back down when someone is running from them, no matter how minor the underlying crime is.”
Making matters worse, in the cop culture that is America today, the Bill of Rights doesn’t amount to much. Unless, that is, it’s the Law Enforcement Officers’ Bill of Rights (LEOBoR), which protects police officers from being subjected to the kinds of debilitating indignities heaped upon the average citizen.
Most Americans, oblivious about their own rights, aren’t even aware that police officers have their own Bill of Rights. Yet at the same time that our own protections against government abuses have been reduced to little more than historic window dressing, 14 states have already adopted LEOBoRs—written by police unions and being considered by many more states and Congress—which provides police officers accused of a crime with special due process rights and privileges not afforded to the average citizen.
In other words, the LEOBoR protects police officers from being treated as we are treated during criminal investigations: questioned unmercifully for hours on end, harassed, harangued, browbeaten, denied food, water and bathroom breaks, subjected to hostile interrogations, and left in the dark about our accusers and any charges and evidence against us.
Not only are officers given a 10-day “cooling-off period” during which they cannot be forced to make any statements about the incident, but when they are questioned, it must be “for a reasonable length of time, at a reasonable hour, by only one or two investigators (who must be fellow policemen), and with plenty of breaks for food and water.”
According to investigative journalist Eli Hager, the most common rights afforded police officers accused of wrongdoing are as follows:
- If a department decides to pursue a complaint against an officer, the department must notify the officer and his union.
- The officer must be informed of the complainants, and their testimony against him, before he is questioned.
- During questioning, investigators may not harass, threaten, or promise rewards to the officer, as interrogators not infrequently do to civilian suspects.
- Bathroom breaks are assured during questioning.
- In Maryland, the officer may appeal his case to a “hearing board,” whose decision is binding, before a final decision has been made by his superiors about his discipline. The hearing board consists of three of the suspected offender’s fellow officers.
- In some jurisdictions, the officer may not be disciplined if more than a certain number of days (often 100) have passed since his alleged misconduct, which limits the time for investigation.
- Even if the officer is suspended, the department must continue to pay salary and benefits, as well as the cost of the officer’s attorney.
It’s a pretty sweet deal if you can get it, I suppose: protection from the courts, immunity from wrongdoing, paid leave while you’re under investigation, and the assurance that you won’t have to spend a dime of your own money in your defense. And yet these LEOBoR epitomize everything that is wrong with America today.
Once in a while, the system appears to work on the side of justice, and police officers engaged in wrongdoing are actually charged for abusing their authority and using excessive force against American citizens.
Yet even in these instances, it’s still the American taxpayer who foots the bill.
For example, Baltimore taxpayers have paid roughly $5.7 million since 2011 over lawsuits stemming from police abuses, with an additional $5.8 million going towards legal fees. If the six Baltimore police officers charged with the death of Freddie Gray are convicted, you can rest assured it will be the Baltimore taxpayers who feel the pinch.
New York taxpayers have shelled out almost $1,130 per year per police officer (there are 34,500 officers in the NYPD) to address charges of misconduct. That translates to $38 million every year just to clean up after these so-called public servants.
Over a 10-year-period, Oakland, Calif., taxpayers were made to cough up more than $57 million (curiously enough, the same amount as the city’s deficit back in 2011) in order to settle accounts with alleged victims of police abuse.
Chicago taxpayers were asked to pay out nearly $33 million on one day alone to victims of police misconduct, with one person slated to receive $22.5 million, potentially the largest single amount settled on any one victim. The City has paid more than half a billion dollars to victims over the course of a decade. The Chicago City Council actually had to borrow $100 million just to pay off lawsuits arising over police misconduct in 2013. The city’s payout for 2014 was estimated to be in the same ballpark, especially with cases pending such as the one involving the man who was reportedly sodomized by a police officer’s gun in order to force him to “cooperate.”
Over 78% of the funds paid out by Denver taxpayers over the course of a decade arose as a result of alleged abuse or excessive use of force by the Denver police and sheriff departments. Meanwhile, taxpayers in Ferguson, Missouri, are being asked to pay $40 million in compensation—more than the city’s entire budget—for police officers treating them “‘as if they were war combatants,’ using tactics like beating, rubber bullets, pepper spray, and stun grenades, while the plaintiffs were peacefully protesting, sitting in a McDonalds, and in one case walking down the street to visit relatives.”
That’s just a small sampling of the most egregious payouts, but just about every community—large and small—feels the pinch when it comes to compensating victims who have been subjected to deadly or excessive force by police.
The ones who rarely ever feel the pinch are the officers accused or convicted of wrongdoing, “even if they are disciplined or terminated by their department, criminally prosecuted, or even imprisoned.” Indeed, a study published in the NYU Law Review reveals that 99.8% of the monies paid in settlements and judgments in police misconduct cases never come out of the officers’ own pockets, even when state laws require them to be held liable. Moreover, these officers rarely ever have to pay for their own legal defense.
For instance, law professor Joanna C. Schwartz references a case in which three Denver police officers chased and then beat a 16-year-old boy, stomping “on the boy’s back while using a fence for leverage, breaking his ribs and causing him to suffer kidney damage and a lacerated liver.” The cost to Denver taxpayers to settle the lawsuit: $885,000. The amount the officers contributed: 0.
Kathryn Johnston, 92 years old, was shot and killed during a SWAT team raid that went awry. Attempting to cover their backs, the officers falsely claimed Johnston’s home was the site of a cocaine sale and went so far as to plant marijuana in the house to support their claim. The cost to Atlanta taxpayers to settle the lawsuit: $4.9 million. The amount the officers contributed: 0.
Meanwhile, in Albuquerque, a police officer was convicted of raping a woman in his police car, in addition to sexually assaulting four other women and girls, physically abusing two additional women, and kidnapping or falsely imprisoning five men and boys. The cost to the Albuquerque taxpayers to settle the lawsuit: $1,000,000. The amount the officer contributed: 0.
Human Rights Watch notes that taxpayers actually pay three times for officers who repeatedly commit abuses: “once to cover their salaries while they commit abuses; next to pay settlements or civil jury awards against officers; and a third time through payments into police ‘defense’ funds provided by the cities.”
Still, the number of times a police officer is actually held accountable for wrongdoing while on the job is miniscule compared to the number of times cops are allowed to walk away with little more than a slap on the wrist.
A large part of the problem can be chalked up to influential police unions and laws providing for qualified immunity, not to mention these Law Enforcement Officers’ Bill of Rights laws, which allow officers to walk away without paying a dime for their wrongdoing.
Another part of the problem is rampant cronyism among government bureaucrats: those deciding whether a police officer should be immune from having to personally pay for misbehavior on the job all belong to the same system, all with a vested interest in protecting the police and their infamous code of silence: city and county attorneys, police commissioners, city councils and judges.
Most of all, what we’re dealing with is systemic corruption that protects wrongdoing and recasts it in a noble light. However, there is nothing noble about government agents who kick, punch, shoot and kill defenseless individuals. There is nothing just about police officers rendered largely immune from prosecution for wrongdoing. There is nothing democratic about the word of a government agent being given greater weight in court than that of the average citizen. And no good can come about when the average citizen has no real means of defense against a system that is weighted in favor of government bureaucrats.
So if you want a recipe for disaster, this is it: Take police cadets, train them in the ways of war, dress and equip them for battle, teach them to see the people they serve not as human beings but as suspects and enemies, and then indoctrinate them into believing that their main priority is to make it home alive at any cost. While you’re at it, spend more time drilling them on how to use a gun (58 hours) and employ defensive tactics (49 hours) than on how to calm a situation before resorting to force (8 hours).
Then, once they’re hyped up on their own authority and the power of the badge and their gun, throw in a few court rulings suggesting that security takes precedence over individual rights, set it against a backdrop of endless wars and militarized law enforcement, and then add to the mix a populace distracted by entertainment, out of touch with the workings of their government, and more inclined to let a few sorry souls suffer injustice than challenge the status quo or appear unpatriotic.
That’s not to discount the many honorable police officers working thankless jobs across the country in order to serve and protect their fellow citizens, but there can be no denying that, as journalist Michael Daly acknowledges, there is a troublesome “cop culture that tends to dehumanize or at least objectify suspected lawbreakers of whatever race. The instant you are deemed a candidate for arrest, you become not so much a person as a ‘perp.’”
Older cops are equally troubled by this shift in how police are being trained to view Americans—as things, not people. Daly had a veteran police officer join him to review the video footage of 43-year-old Eric Garner crying out and struggling to breathe as cops held him in a chokehold. (In yet another example of how the legal system and the police protect their own, no police officers were charged for Garner’s death.) Daly describes the veteran officer’s reaction to the footage, which as Daly points out, “constitutes a moral indictment not so much of what the police did but of what the police did not do”:
“I don’t see anyone in that video saying, ‘Look, we got to ease up,’” says the veteran officer. “Where’s the human side of you in that you’ve got a guy saying, ‘I can’t breathe?’” The veteran officer goes on, “Somebody needs to say, ‘Stop it!’ That’s what’s missing here was a voice of reason. The only voice we’re hearing is of Eric Garner.” The veteran officer believes Garner might have survived had anybody heeded his pleas. “He could have had a chance,” says the officer, who is black. “But you got to believe he’s a human being first. A human being saying, ‘I can’t breathe.’”
As I point out in my new book Battlefield America: The War on the American People, when all is said and done, the various problems we’re facing today—militarized police, police shootings of unarmed people, the electronic concentration camp being erected around us, SWAT team raids, etc.—can be attributed to the fact that our government and its agents have ceased to see us as humans first.
Then again, perhaps we are just as much to blame for this sorry state of affairs. After all, if we want to be treated like human beings—with dignity and worth—then we need to start treating those around us in the same manner. As Martin Luther King Jr. warned in a speech given exactly one year to the day before he was killed: “We must rapidly begin the shift from a ‘thing-oriented’ society to a ‘person-oriented’ society. When machines and computers, profit motives and property rights are considered more important than people, the giant triplets of racism, materialism, and militarism are incapable of being conquered.”
A True Blue liberal except for Iran and Palestine
Democratic Senator Ben Cardin of Maryland is not very well known to the public, overshadowed as he is by his own party’s more newsworthy and photogenic congressional leadership and the gaggle of Republicans that is currently lining up in a bid to take the White House. Cardin is, by most accounts, a conventional liberal. He was active in the civil rights movement and embraced every progressive cause in his pre-senatorial days while his voting record both as a congressman and a senator has been reliably left-of-center.
Ben Cardin is the scion of a Baltimore family heavily involved in Maryland state politics. He, his father and uncle all served in the State Assembly and his father was later a judge. All three are lawyers and all were closely connected to Maryland’s politically powerful Jewish community, concentrated in Montgomery and Baltimore counties, which has been traditionally aligned with the Democratic Party.
As an elected official, Cardin regards himself as personally responsible for delivering benefits to his Jewish constituents. He sponsors the Senator Ben Cardin Jewish Scholars Program and also has been active in steering Department of Homeland Security (DHS) grants to what he calls “high risk” Jewish organizations in Baltimore. Due to the assiduous efforts of Congressmen like Cardin fully 97% of all DHS grants go to Jewish groups.
Support for Israel is inevitably a sine qua non in Cardin’s circle and candidates for higher office in Maryland are routinely screened for the views on the Middle East. Donna Edwards, an African-American congresswoman who is currently running to fill the seat that will be vacated by incumbent Senator Barbara Mikulski in 2016, has, for example, fallen afoul of the Jewish community thought police on the Israel issue. Though repeatedly asserting her love and support for Israel she is being castigated because “she has regularly ducked resolutions and letters backed by the American Israel Public Affairs Committee (AIPAC), Washington’s dominant Israel lobby, which takes a harder line in support of the country’s self-defense.” She also voted “present” rather than “yes” when the House of Representatives passed its malicious 2009 resolution endorsing Israel’s right to use overwhelming firepower to defend itself against bottle rockets from Gaza. More recently she boycotted the speech by Israeli Prime Minister Benjamin Netanyahu because she believed it to be an affront to the President of the United States. Even though Edwards has never in any sense voted against Israel in any substantive way she is clearly regarded as not subservient enough by those who matter.
Cardin, who received donations of $218,000 from the Israel Lobby for his 2012 Senate race alone, is the ranking Democrat on the Senate Foreign Affairs Committee, a position he acquired when disgraced New Jersey Senator Robert Menendez was forced to step down. He has been in the news lately for taking on a seemingly uncharacteristic task in the Senate, having co-sponsored with Republican Bob Corker a bill that will require the Senate to vote on any agreement that President Obama makes with Iran. The bill, which passed out of the Foreign Relations Committee by a unanimous 19-0 vote, has been described as a watered down version of a more rigorous bill crafted by the Republican majority, enabling a number of Democrats to add their support.
Recognizing that it might be a less bad option, a reluctant President Barack Obama, perhaps unwisely, has even pledged not to veto the revised bill. The stated intention of Corker-Cardin is to permit the congress to have some voice regarding what is undeniably a major foreign policy issue. Supporters want the country’s legislature to be able to indicate their lack of support for a bad bill, if that should turn out to be the case.
Though the bill is being described as a compromise it does not really change very much. While the president can on his own authority suspend sanctions on Iran, the passage of the bill would delay his ability to do so until after Congress has between 30 and 82 days (depending on details) to review the deal and vote for or against it. And while the president can indefinitely suspend their implementation, only Congress can actually cancel the sanctions because they are mandated through legislative authority.
Thus Congress can hold up a final agreement but the bill does not actually require congressional approval for an agreement to be implemented. And though Congress could theoretically block any lifting of its own legislative sanctions on Iran, it would require a two-thirds vote of both the Senate and House to override the expected Obama veto. Nevertheless, Obama’s agreement to allow a vote does concede that Congress has a potential oversight role in foreign policy, something that the president would have chosen to avoid.
The assumption that Cardin, a loyal Democrat, was interested in producing a compromise to help the president attain a negotiated agreement to eliminate Iran’s nonexistent nuclear weapons program is intriguing but not completely convincing given the Senator’s demonstrated inclination to see U.S. foreign policy from the point of view of Israel. And interestingly enough, AIPAC also supports the Corker-Cardin bill as-is and has resisted attempts by Republicans to make it stronger.
Why would that be the case as AIPAC consistently calls for forceful action against Iran? It might be because, appearances aside, Cardin is not acting in good faith and is actually likely to be working hand-in-hand with AIPAC to accomplish two things. First, he almost certainly wants to reestablish complete congressional bipartisanship on any and all issues relating to Israel, countering the troubling Republican Party’s alignment of its own foreign policy interests with those of Benjamin Netanyahu. As an AIPAC official has expressed it, “Our fundamental view is that this bill is the first step of a number of different steps on the Iran deal. The first and foremost priority is to make sure the bill gets passed to make sure congress is guaranteed a chance to pass judgment on the deal.”
This means that both AIPAC and Cardin want the modified Corker bill to pass but they want that to happen in expectation that the Obama White House agreement with Iran will eventually fail in a bipartisan fashion with more than two-thirds of congressmen in opposition. By some estimates, AIPAC believes that it already has the votes in hand in the Senate at least to do just that and expects that a number of Democratic Senators to include Charles Schumer of New York, who regards himself as “Israel’s guardian” in the upper chamber, will join Republicans in voting against the president.
The AIPAC comment that the bill is a “first step” is critical to understanding what is going on while Senator Ben Cardin’s regard for Israel and its presumed interests should be taken as a given. In March Cardin spoke at AIPAC’s annual gathering where he promised to introduce legislation to block European attempts to boycott or sanction Israeli exports produced in the occupied territories. Cardin’s mixed-up view of a progressive world order combined with deference to what he regards as Israeli interests were notably on display one week after his agreement with Corker when he delivered on his promise.
On April 21 st Cardin and his House colleague Peter Roskam attached at the last minute AIPAC drafted amendments to an omnibus trade bill that committed the United States government to use its leverage in trade agreements to block European Union efforts to boycott or sanction products being produced in Israel’s illegal West Bank settlements. The issue is of some consequence as the EU is Israel’s largest export market. The Cardin-AIPAC amendment includes language making it a primary U.S. objective to protect both products from Israel and from what is referred to by the euphemism “Israeli-controlled territories,” a curious position for a U.S. Senator to be taking as United States policy has long been opposed to the settlements and has frequently declared them to be illegal.
Cardin hypocritically justified his amendment by stating “I think it’s critically important that the provisions that are included… for good governance and respect for international human rights need to be a principle trade objective.” Concerning Cardin’s stated respect for international human rights, it should be noted that he enthusiastically supported boycotting apartheid South Africa even though he is opposed to the Palestinians using the same legal and non-violent expedient to obtain their freedom from a brutal Israeli occupation. To that end Cardin characteristically is willing to put U.S. interests on a back burner so he can use American trade policy to protect Israel while perversely cloaking his turpitude in faux sentiments about doing the right thing.
Finally, it is the ultimate irony that the sanctimonious junior Senator from Maryland serves as the ranking member of the U.S.-Helsinki Commission on Human Rights. He recently traveled with his wife by way of military Gulfstream to Copenhagen for official meetings arranged by that organization, stopping for a couple of days in Paris where he stayed in a five star hotel and met with Jewish leaders. The issue of Palestine apparently did not come up.
As she bulldozes her way to the Democratic presidential nomination, former First Lady, New York Senator and Secretary of State Hillary Clinton is leaving no gold nugget unturned as she finances her campaign. Having amassed a wide variety of very wealthy friends throughout the global community, she is in an excellent position to call in favors and promise new ones in return for their financial assistance, as she purchases a four-year lease on the most exclusive real estate in the world.
One recent donation, not directly to her campaign, that has raised some eyebrows, although not in Democratic circles, where Mrs. Clinton, who has done little right can do nothing wrong, is money the Clinton Foundation accepted from a company owned by the government of Morocco. One might ask what the problem with such a donation might be. Cannot a foreign government donate funds to a charitable organization based in the United States?
Unfortunately, it isn’t quite as simple as that. This is not the American Red Cross we are talking about, but an organization operated by one of the most politically active and connected families in U.S. history. As late as 2011, when Mrs. Clinton was Secretary of State, the State Department accused the government of Morocco of ‘arbitrary arrests and corruption in all branches of government’. Now, we could discuss the concept of the kettle calling the pot black in terms of government corruption, but we’ll leave that for a later essay. Let’s look at some detail from the State Department report:
“The most significant, continuing human rights problems were the lack of citizens’ right to change the constitutional provisions establishing the country’s monarchical form of government, arbitrary arrests, and corruption in all branches of government.
“Other human rights problems reported during the year included police use of excessive force to quell peaceful protests, resulting in dozens of injuries and at least four deaths; torture and other abuses by the security forces; incommunicado detention; poor prison and detention conditions; political prisoners and detainees; infringement of freedom of the press; lack of freedom of assembly; lack of independence of the judiciary; discrimination against women and girls; trafficking in persons; and child labor, particularly in the informal sector.”
Following the announcement of the $1 million donation from the government-owned Office Cherifien des Phosphates (OCP), Mrs. Clinton announced that the money would be used to sponsor a conference for the Clinton Foundation in Marrakech. She called Morocco “a vital hub for economic and cultural exchange”, eliminating any mention of political prisoners, police violence or human trafficking. Might that sum of money have been sufficient to blind the former Secretary of State to facts she was aware of when she had that job?
The donation was made, and the conference announced, prior to Mrs. Clinton’s long-expected declaration of candidacy for president. But still one wonders what possible benefit there could be for the OCP in making this donation? Is this anything more than a sincere desire to help those who might benefit from the Clinton Foundation largesse?
Well, yes, there may be another beneficiary. The OCP is involved in the extraction of mineral resources from the Western Sahara, disputed territory often referred to as the ‘last colony in Africa’, that Morocco controls. It is illegal under international law for an occupying or controlling power to extract for profit the natural resources of the country in dispute. The OCP is owned by the Moroccan government. The U.S. has a long history of allowing occupying powers to exploit, in violation of international law, the natural resources of their victims: note Israel’s extraction of resources from the Dead Sea. The money that the American Israel Political Affairs Committee (AIPAC) funnels to U.S. politicians is sufficient to cause the U.S. to look the other way; there is no equivalent lobby group representing Morocco, so perhaps this donation will suffice.
Money talks in U.S. governance. The same State Department report that detailed Moroccan abuses also commented on Israel. The influence of AIPAC is clear in these so-called ‘findings’:
* “The law prohibits arbitrary arrest and detention, and the government generally observed these prohibitions for all citizens.” This, despite the almost constant arrests without charge and detention of countless Palestinian men, women and children, both in Palestine and those living in Israel.
* “Criminal suspects are apprehended with warrants based on sufficient evidence and issued by an authorized official. Authorities generally informed such persons promptly of charges against them.” See above.
* “Defendants enjoy the right to presumption of innocence and the right to consult with an attorney, or if indigent, to have one provided at public expense.” This, of course, does not apply to Palestinians.
* “Arbitrary Interference with Privacy, Family, Home, or Correspondence. The law prohibits such actions, and the government generally respected those prohibitions in practice.” Israel Defense Forces (IDF; read: Terrorists) break into Palestinian homes at any time of the day or night, search the homes, steal valuables and generally terrorize the residents. Palestinian homes are arbitrarily bulldozed to make room for illegal and internationally-condemned settlements.
The list goes on, but this should suffice to indicate the degree to which money runs roughshod over human rights in U.S. governance. One thinks that the executives of the OCP can now sleep peacefully, confident that there will be no U.S. interference in their rape of the Western Sahara.
What other foreign governments may see benefit to themselves in a future Hillary Clinton presidency? Since the U.S. is always ready to invade a nation that displeases it, often by some perceived threat to U.S. economic dominance, one would think that most nations will be running to Mrs. Clinton with checkbook in hand, wanting to please the fairy queen and appease the economic gods so worshiped by the U.S. Additionally, such homage would enable them to ignore human rights and exploit the poor for the benefit of the rich, without the U.S. complaining about such abuses. And who will the presumptive Democratic nominee turn away? Anyone? After all, with an alleged target of $2 billion dollars for her campaign, there really are no human rights abuses that can’t be overlooked. Perhaps Syria will make a substantial donation, and thus end U.S. aggression against it.
But are there not built-in protections against this sort of thing, government ‘watchdogs’, if you will, to assure that no such collusion exists? In an article published in The New York Times on May 3, Federal Election Commission (FEC) chairwoman Ann M. Ravel said that “…her organization is powerless to safeguard against misconduct in 2016 presidential campaign fundraising and spending”, mainly due to partisan gridlock. So no, there is nothing to stop Mrs. Clinton, and any and all other candidates, from taking donations from whomever and wherever those donations are offered. And it is unlikely that any of those proffering untold amounts of money have the best interest of the common U.S. citizen at heart. No, they will be foreign governments who wish to begin or continue the exploitation of oppressed people without interference from the U.S., or domestic corporations seeking to continue the vast profits their shareholders earn from war, or from manufacturing products with limited safety or environmental restrictions.
As each presidential election approaches, pundits from the right and left proclaim that this is the most important in the history of the U.S., and that the very survival of the country depends on the outcome. Yet following each election, the nation does not implode in a ball of flames, but continues on, mainly with business as usual. That business is war, disregard for human rights at home and abroad and the worship of the almighty dollar. Mrs. Clinton will usher in no change; her every action speaks volumes to that fact.
Robert Fantina’s latest book is Empire, Racism and Genocide: a History of US Foreign Policy (Red Pill Press).
The Wall Street Connection (1992 to 2016)
[This piece has been adapted and updated by Nomi Prins from chapters 18 and 19 of her book All the Presidents’ Bankers: The Hidden Alliances that Drive American Power, just out in paperback (Nation Books).]
The past, especially the political past, doesn’t just provide clues to the present. In the realm of the presidency and Wall Street, it provides an ongoing pathway for political-financial relationships and policies that remain a threat to the American economy going forward.
When Hillary Clinton video-announced her bid for the Oval Office, she claimed she wanted to be a “champion” for the American people. Since then, she has attempted to recast herself as a populist and distance herself from some of the policies of her husband. But Bill Clinton did not become president without sharing the friendships, associations, and ideologies of the elite banking sect, nor will Hillary Clinton. Such relationships run too deep and are too longstanding.
To grasp the dangers that the Big Six banks (JPMorgan Chase, Citigroup, Bank of America, Wells Fargo, Goldman Sachs, and Morgan Stanley) presently pose to the financial stability of our nation and the world, you need to understand their history in Washington, starting with the Clinton years of the 1990s. Alliances established then (not exclusively with Democrats, since bankers are bipartisan by nature) enabled these firms to become as politically powerful as they are today and to exert that power over an unprecedented amount of capital. Rest assured of one thing: their past and present CEOs will prove as critical in backing a Hillary Clinton presidency as they were in enabling her husband’s years in office.
In return, today’s titans of finance and their hordes of lobbyists, more than half of whom held prior positions in the government, exact certain requirements from Washington. They need to know that a safety net or bailout will always be available in times of emergency and that the regulatory road will be open to whatever practices they deem most profitable.
Whatever her populist pitch may be in the 2016 campaign — and she will have one — note that, in all these years, Hillary Clinton has not publicly condemned Wall Street or any individual Wall Street leader. Though she may, in the heat of that campaign, raise the bad-apples or bad-situation explanation for Wall Street’s role in the financial crisis of 2007-2008, rest assured that she will not point fingers at her friends. She will not chastise the people that pay her hundreds of thousands of dollars a pop to speak or the ones that have long shared the social circles in which she and her husband move. She is an undeniable component of the Clinton political-financial legacy that came to national fruition more than 23 years ago, which is why looking back at the history of the first Clinton presidency is likely to tell you so much about the shape and character of the possible second one.
The 1992 Election and the Rise of Bill Clinton
Challenging President George H.W. Bush, who was seeking a second term, Arkansas Governor Bill Clinton announced he would seek the 1992 Democratic nomination for the presidency on October 2, 1991. The upcoming presidential election would not, however, turn out to alter the path of mergers or White House support for deregulation that was already in play one iota.
First, though, Clinton needed money. A consummate fundraiser in his home state, he cleverly amassed backing and established early alliances with Wall Street. One of his key supporters would later change American banking forever. As Clinton put it, he received “invaluable early support” from Ken Brody, a Goldman Sachs executive seeking to delve into Democratic politics. Brody took Clinton “to a dinner with high-powered New York businesspeople, including Bob Rubin, whose tightly reasoned arguments for a new economic policy,” Clinton later wrote, “made a lasting impression on me.”
The battle for the White House kicked into high gear the following fall. William Schreyer, chairman and CEO of Merrill Lynch, showed his support for Bush by giving the maximum personal contribution to his campaign committee permitted by law: $1,000. But he wanted to do more. So when one of Bush’s fundraisers solicited him to contribute to the Republican National Committee’s nonfederal, or “soft money,” account, Schreyer made a $100,000 donation.
The bankers’ alliances remained divided among the candidates at first, as they considered which man would be best for their own power trajectories, but their donations were plentiful: mortgage and broker company contributions were $1.2 million; 46% to the GOP and 54% to the Democrats. Commercial banks poured in $14.8 million to the 1992 campaigns at a near 50-50 split.
Clinton, like every good Democrat, campaigned publicly against the bankers: “It’s time to end the greed that consumed Wall Street and ruined our S&Ls [Savings and Loans] in the last decade,” he said. But equally, he had no qualms about taking money from the financial sector. In the early months of his campaign, BusinessWeek estimated that he received $2 million of his initial $8.5 million in contributions from New York, under the care of Ken Brody.
“If I had a Ken Brody working for me in every state, I’d be like the Maytag man with nothing to do,” said Rahm Emanuel, who ran Clinton’s nationwide fundraising committee and later became Barack Obama’s chief of staff. Wealthy donors and prospective fundraisers were invited to a select series of intimate meetings with Clinton at the plush Manhattan office of the prestigious private equity firm Blackstone.
Robert Rubin Comes to Washington
Clinton knew that embracing the bankers would help him get things done in Washington, and what he wanted to get done dovetailed nicely with their desires anyway. To facilitate his policies and maintain ties to Wall Street, he selected a man who had been instrumental to his campaign, Robert Rubin, as his economic adviser.
In 1980, Rubin had landed on Goldman Sachs’ management committee alongside fellow Democrat Jon Corzine. A decade later, Rubin and Stephen Friedman were appointed cochairmen of Goldman Sachs. Rubin’s political aspirations met an appropriate opportunity when Clinton captured the White House.
On January 25, 1993, Clinton appointed him as assistant to the president for economic policy. Shortly thereafter, the president created a unique role for his comrade, head of the newly created National Economic Council. “I asked Bob Rubin to take on a new job,” Clinton later wrote, “coordinating economic policy in the White House as Chairman of the National Economic Council, which would operate in much the same way the National Security Council did, bringing all the relevant agencies together to formulate and implement policy… [I]f he could balance all of [Goldman Sachs’] egos and interests, he had a good chance to succeed with the job.” (Ten years later, President George W. Bush gave the same position to Rubin’s old partner, Friedman.)
Back at Goldman, Jon Corzine, co-head of fixed income, and Henry Paulson, co-head of investment banking, were ascending through the ranks. They became co-CEOs when Friedman retired at the end of 1994.
Those two men were the perfect bipartisan duo. Corzine was a staunch Democrat serving on the International Capital Markets Advisory Committee of the Federal Reserve Bank of New York (from 1989 to 1999). He would co-chair a presidential commission for Clinton on capital budgeting between 1997 and 1999, while serving in a key role on the Borrowing Advisory Committee of the Treasury Department. Paulson was a well connected Republican and Harvard graduate who had served on the White House Domestic Council as staff assistant to the president in the Nixon administration.
Bankers Forge Ahead
By May 1995, Rubin was impatiently warning Congress that the Glass-Steagall Act could “conceivably impede safety and soundness by limiting revenue diversification.” Banking deregulation was then inching through Congress. As they had during the previous Bush administration, both the House and Senate Banking Committees had approved separate versions of legislation to repeal Glass-Steagall, the 1933 Act passed by the administration of Franklin Delano Roosevelt that had separated deposit-taking and lending or “commercial” bank activities from speculative or “investment bank” activities, such as securities creation and trading. Conference negotiations had fallen apart, though, and the effort was stalled.
By 1996, however, other industries, representing core clients of the banking sector, were already being deregulated. On February 8, 1996, Clinton signed the Telecom Act, which killed many independent and smaller broadcasting companies by opening a national market for “cross-ownership.” The result was mass mergers in that sector advised by banks.
Deregulation of companies that could transport energy across state lines came next. Before such deregulation, state commissions had regulated companies that owned power plants and transmission lines, which worked together to distribute power. Afterward, these could be divided and effectively traded without uniform regulation or responsibility to regional customers. This would lead to blackouts in California and a slew of energy derivatives, as well as trades at firms such as Enron that used the energy business as a front for fraudulent deals.
The number of mergers and stock and debt issuances ballooned on the back of all the deregulation that eliminated barriers that had kept companies separated. As industries consolidated, they also ramped up their complex transactions and special purpose vehicles (off-balance-sheet, offshore constructions tailored by the banking community to hide the true nature of their debts and shield their profits from taxes). Bankers kicked into overdrive to generate fees and create related deals. Many of these blew up in the early 2000s in a spate of scandals and bankruptcies, causing an earlier millennium recession.
Meanwhile, though, bankers plowed ahead with their advisory services, speculative enterprises, and deregulation pursuits. President Clinton and his team would soon provide them an epic gift, all in the name of U.S. global power and competitiveness. Robert Rubin would steer the White House ship to that goal.
On February 12, 1999, Rubin found a fresh angle to argue on behalf of banking deregulation. He addressed the House Committee on Banking and Financial Services, claiming that, “the problem U.S. financial services firms face abroad is more one of access than lack of competitiveness.”
He was referring to the European banks’ increasing control of distribution channels into the European institutional and retail client base. Unlike U.S. commercial banks, European banks had no restrictions keeping them from buying and teaming up with U.S. or other securities firms and investment banks to create or distribute their products. He did not appear concerned about the destruction caused by sizeable financial bets throughout Europe. The international competitiveness argument allowed him to focus the committee on what needed to be done domestically in the banking sector to remain competitive.
Rubin stressed the necessity of HR 665, the Financial Services Modernization Act of 1999, or the Gramm-Leach-Bliley Act, that was officially introduced on February 10, 1999. He said it took “fundamental actions to modernize our financial system by repealing the Glass-Steagall Act prohibitions on banks affiliating with securities firms and repealing the Bank Holding Company Act prohibitions on insurance underwriting.”
The Gramm-Leach-Bliley Act Marches Forward
On February 24, 1999, in more testimony before the Senate Banking Committee, Rubin pushed for fewer prohibitions on bank affiliates that wanted to perform the same functions as their larger bank holding company, once the different types of financial firms could legally merge. That minor distinction would enable subsidiaries to place all sorts of bets and house all sorts of junk under the false premise that they had the same capital beneath them as their parent. The idea that a subsidiary’s problems can’t taint or destroy the host, or bank holding company, or create “catastrophic” risk, is a myth perpetuated by bankers and political enablers that continues to this day.
Rubin had no qualms with mega-consolidations across multiple service lines. His real problems were those of his banker friends, which lay with the financial modernization bill’s “prohibition on the use of subsidiaries by larger banks.” The bankers wanted the right to establish off-book subsidiaries where they could hide risks, and profits, as needed.
Again, Rubin decided to use the notion of remaining competitive with foreign banks to make his point. This technicality was “unacceptable to the administration,” he said, not least because “foreign banks underwrite and deal in securities through subsidiaries in the United States, and U.S. banks [already] conduct securities and merchant banking activities abroad through so-called Edge subsidiaries.” Rubin got his way. These off-book, risky, and barely regulated subsidiaries would be at the forefront of the 2008 financial crisis.
On March 1, 1999, Senator Phil Gramm released a final draft of the Financial Services Modernization Act of 1999 and scheduled committee consideration for March 4th. A bevy of excited financial titans who were close to Clinton, including Travelers CEO Sandy Weill, Bank of America CEO, Hugh McColl, and American Express CEO Harvey Golub, called for “swift congressional action.”
The Quintessential Revolving-Door Man
The stock market continued its meteoric rise in anticipation of a banker-friendly conclusion to the legislation that would deregulate their industry. Rising consumer confidence reflected the nation’s fondness for the markets and lack of empathy with the rest of the world’s economic plight. On March 29, 1999, the Dow Jones Industrial Average closed above 10,000 for the first time. Six weeks later, on May 6th, the Financial Services Modernization Act passed the Senate. It legalized, after the fact, the merger that created the nation’s biggest bank. Citigroup, the marriage of Citibank and Travelers, had been finalized the previous October.
It was not until that point that one of Glass-Steagall’s main assassins decided to leave Washington. Six days after the bill passed the Senate, on May 12, 1999, Robert Rubin abruptly announced his resignation. As Clinton wrote, “I believed he had been the best and most important treasury secretary since Alexander Hamilton… He had played a decisive role in our efforts to restore economic growth and spread its benefits to more Americans.”
Clinton named Larry Summers to succeed Rubin. Two weeks later, BusinessWeek reported signs of trouble in merger paradise — in the form of a growing rift between John Reed, the former Chairman of Citibank, and Sandy Weill at the new Citigroup. As Reed said, “Co-CEOs are hard.” Perhaps to patch their rift, or simply to take advantage of a political opportunity, the two men enlisted a third person to join their relationship — none other than Robert Rubin.
Rubin’s resignation from Treasury became effective on July 2nd. At that time, he announced, “This almost six and a half years has been all-consuming, and I think it is time for me to go home to New York and to do whatever I’m going to do next.” Rubin became chairman of Citigroup’s executive committee and a member of the newly created “office of the chairman.” His initial annual compensation package was worth around $40 million. It was more than worth the “hit” he took when he left Goldman for the Treasury post.
Three days after the conference committee endorsed the Gramm-Leach-Bliley bill, Rubin assumed his Citigroup position, joining the institution destined to dominate the financial industry. That very same day, Reed and Weill issued a joint statement praising Washington for “liberating our financial companies from an antiquated regulatory structure,” stating that “this legislation will unleash the creativity of our industry and ensure our global competitiveness.”
On November 4th, the Senate approved the Gramm-Leach-Bliley Act by a vote of 90 to 8. (The House voted 362–57 in favor.) Critics famously referred to it as the Citigroup Authorization Act.
Mirth abounded in Clinton’s White House. “Today Congress voted to update the rules that have governed financial services since the Great Depression and replace them with a system for the twenty-first century,” Summers said. “This historic legislation will better enable American companies to compete in the new economy.”
But the happiness was misguided. Deregulating the banking industry might have helped the titans of Wall Street but not people on Main Street. The Clinton era epitomized the vast difference between appearance and reality, spin and actuality. As the decade drew to a close, Clinton basked in the glow of a lofty stock market, a budget surplus, and the passage of this key banking “modernization.” It would be revealed in the 2000s that many corporate profits of the 1990s were based on inflated evaluations, manipulation, and fraud. When Clinton left office, the gap between rich and poor was greater than it had been in 1992, and yet the Democrats heralded him as some sort of prosperity hero.
When he resigned in 1997, Robert Reich, Clinton’s labor secretary, said, “America is prospering, but the prosperity is not being widely shared, certainly not as widely shared as it once was… We have made progress in growing the economy. But growing together again must be our central goal in the future.” Instead, the growth of wealth inequality in the United States accelerated, as the men yielding the most financial power wielded it with increasingly less culpability or restriction. By 2015, that wealth or prosperity gap would stand near historic highs.
The power of the bankers increased dramatically in the wake of the repeal of Glass-Steagall. The Clinton administration had rendered twenty-first-century banking practices similar to those of the pre-1929 crash. But worse. “Modernizing” meant utilizing government-backed depositors’ funds as collateral for the creation and distribution of all types of complex securities and derivatives whose proliferation would be increasingly quick and dangerous.
Eviscerating Glass-Steagall allowed big banks to compete against Europe and also enabled them to go on a rampage: more acquisitions, greater speculation, and more risky products. The big banks used their bloated balance sheets to engage in more complex activity, while counting on customer deposits and loans as capital chips on the global betting table. Bankers used hefty trading profits and wealth to increase lobbying funds and campaign donations, creating an endless circle of influence and mutual reinforcement of boundary-less speculation, endorsed by the White House.
Deposits could be used to garner larger windfalls, just as cheap labor and commodities in developing countries were used to formulate more expensive goods for profit in the upper echelons of the global financial hierarchy. Energy and telecoms proved especially fertile ground for the investment banking fee business (and later for fraud, extensive lawsuits, and bankruptcies). Deregulation greased the wheels of complex financial instruments such as collateralized debt obligations, junk bonds, toxic assets, and unregulated derivatives.
The Glass-Steagall repeal led to unfettered derivatives growth and unstable balance sheets at commercial banks that merged with investment banks and at investment banks that preferred to remain solo but engaged in dodgier practices to remain “competitive.” In conjunction with the tight political-financial alignment and associated collaboration that began with Bush and increased under Clinton, bankers channeled the 1920s, only with more power over an immense and growing pile of global financial assets and increasingly “open” markets. In the process, accountability would evaporate.
Every bank accelerated its hunt for acquisitions and deposits to amass global influence while creating, trading, and distributing increasingly convoluted securities and derivatives. These practices would foster the kind of shaky, interconnected, and opaque financial environment that provided the backdrop and conditions leading up to the financial meltdown of 2008.
The Realities of 2016
Hillary Clinton is, of course, not her husband. But her access to his past banker alliances, amplified by the ones that she has formed herself, makes her more of a friend than an adversary to the banking industry. In her brief 2008 candidacy, all four of the New York-based Big Six banks ranked among her top 10 corporate donors. They have also contributed to the Clinton Foundation. She needs them to win, just as both Barack Obama and Bill Clinton did.
No matter what spin is used for campaigning purposes, the idea that a critical distance can be maintained between the White House and Wall Street is naïve given the multiple channels of money and favors that flow between the two. It is even more improbable, given the history of connections that Hillary Clinton has established through her associations with key bank leaders in the early 1990s, during her time as a senator from New York, and given their contributions to the Clinton foundation while she was secretary of state. At some level, the situation couldn’t be less complicated: her path aligns with that of the country’s most powerful bankers. If she becomes president, that will remain the case.
Nomi Prins is the author of six books, a speaker, and a distinguished senior fellow at the non-partisan public policy institute Demos. Her most recent book, All the Presidents’ Bankers: The Hidden Alliances that Drive American Power (Nation Books) has just been released in paperback and this piece is adapted and updated from it. She is a former Wall Street executive.
Copyright 2015 Nomi Prins
For over two decades now, US planes have been dumping tons of pesticides over Colombian coca fields.
Originally the Colombian government wholeheartedly supported the ridiculous notion of mass killing all vegetation in attempt to cull the drug trade. However, it is no longer a secret that the health effects of long-term exposure to glyphosate are less than desirable.
Just last month, the World Health Organization was forced to admit that glyphosate is “probably carcinogenic to humans.”
The recent acceptance by the mainstream that Monsanto’s Roundup causes a slew of negative health effects has sparked fear and infighting among the Colombian government.
According to the AFP,
Health Minister Alejandro Gaviria said last week that Colombia should “immediately suspend” spraying — a move vehemently opposed by Defense Minister Juan Carlos Pinzon, who said it would “give criminals the upper hand.”
The row erupted just as US Deputy Secretary of State Antony Blinken paid a visit to Colombia, which the United States sees as one of its closest allies in the region.
The politicians who are fear-mongering about stopping the program are likely scared of losing the hundreds of millions in funds received annually from the US to combat the cultivation of this plant.
Daniel Mejia, the head of Colombia’s Center for Research on Security and Drugs explained why they are worried about the program. “We carried out a study that showed fumigating caused dermatological and respiratory problems and provoked miscarriages,” he said.
Even if dumping massive amount of carcinogenic pesticides from airplanes was a good idea, it’s not effective. According to the United Nations Office on Drugs and Crime, this program has aided Colombia in reducing its coca fields from more than 140,000 hectares (346,000 acres) in 2001 to 48,000 hectares in 2013. However, they conveniently left out the increase seen last year.
The amount of land under coca cultivation in Colombia jumped 39 percent in 2014 to 112,000 hectares (about 27,000 acres), according to the Office of National Drug Control Policy.
Cocaine trafficking in Latin American region has caused a slew violence and turmoil, including the Colombian civil war. However, this turmoil is a direct result of prohibition spearheaded by the United States.
Colombia never had a cocaine trafficking problem until the US-funded war on drugs began its destructive path across South America.
During the 1980s, Peru, Bolivia and Colombia were responsible for 65%, 25% and 10% of the world’s coca production respectively. By 2000, however, the US “war on drugs” in neighboring Andean countries had turned Colombia into the world’s largest cocaine producer by far, representing 90% of the total, according to a report from the from the Woodrow Wilson International Center for Scholars.
The coca plant is one of the most beneficial and astonishingly resilient plants in the world. Resistant to drought and disease, coca needs no irrigation and the alkaloids it contains provide a myriad of medicinal uses. From its analgesic effects to digestive aid, coca’s positive influence in medicine is vast.
The plant has played an important role in history dating back to the Pre-Inca period.
According to a study published by Harvard University in 1975, (Nutritional Value of Coca Leaf (Duke, Aulick, Plowman 1975)) chewing 100 grams of coca is enough to satisfy the nutritional needs of an adult for 24 hours. Thanks to the calcium, proteins, vitamins A and E, and other nutrients it contains, the plant offers even better possibilities to the field of human nutrition than it does to that of medicine, where it is commonly used today.
However, the state cares not about the benefit of such a plant, only that it can be turned into a white powdery substance and snorted to stimulate long and often nonsensical conversations. Instead of cultivating the plant for its benefits, the immoral war on drugs drops carcinogens from airplanes to stop its growth.
The president of Colombia, Juan Manuel Santos, is avoiding any stance on the aerial spraying program whatsoever. According to the AFP, his staff said the final authority on the matter is the National Narcotics Council, which falls under the Justice Ministry. In the meantime, however, the spraying continues.