Richard Fuld (1946- ), the former director of Lehman Brothers. This is the face of evil (it’s rather ordinary and banal, it’s why one must be vigilant). Mark it well. It’s why America lost its moral influence. Such monsters must be put in check or we’ll sink to the level of a banana-republic despotism.
______________________________
Economic cataclysms diverted the attention of the public and the media from a small thing that, at first glance, hardly deserves to dominate the first pages of the printed media and television news. Yet, this small thing conceals an answer to the question, “What caused the current crisis?” 158-year-old Lehman Brothers was the first Wall Street bank to declare bankruptcy. Its director general, the highly-influential Richard Fuld, was summoned to talk to a House oversight committee. He admitted he’d long fooled Lehman’s customers with false business reports and pocketed, whilst doing this, half a billion dollars (13.553 billion roubles. 394.197 million euros. 314.618 million UK pounds). When it became clear that Lehman Brothers Bank was about to go under, Fuld risked forgery. Driven into a corner, he admitted he’d violated existing legislation. Republican Representative John Mica told him he played the villain’s role in the Lehman drama. However late, lawmakers came to see that a Wall Street bank whose bankruptcy heralded the collapse of the American financial system had long been headed by a villain.
What makes things really bad is the pervasive presence of Fuld-like elements in the American corporate community. One of the biggest American financial corporations, Enron, was headed by a multibillionaire by the name of Kenneth Lay. A member of the inner circle of George W Bush’s friends, Lay grudged no expense in the course of Bush’s electoral campaigns and managed to cash in on his own generosity. According to government counts, 65 percent of President Bush’s team-mates come straight from Enron. However, even seasoned insiders are not immune to legal action. A court found Kenneth Lay and Enron’s chief executive officer Geoffrey Skilling guilty of fraud and placed both of them behind bars.
Another member of the inner circle of George W Bush’s friends, Paul Wolfowitz, held what big business sees as a position of crucial importance at the World Bank before being charged with financial fraud and kicked out of office. The former Republican leaders in the House of Representatives and Senate, Thomas DeLay and Bill Friest, also happened to transgress the law. DeLay was put in the dock for his role in illegal financial operations. Friest faces much the same charges. A legal inquiry has opened into his case. The White House saved the Number Two man of the Bush Administration, Vice-President Dick Cheney, from legal prosecution. Cheney’s chief-of-staff, Lewis Libby, was put in the dock instead of his boss. Yet, because Cheney’s Halliburton Corporation enjoys the right to develop the biggest oil fields of Iraq, the shadow of legal responsibility is still looming over the grey eminence of the Bush Administration. When his term in office is over next January, he’ll probably be indicted for abuse of his high position.
The American political and business élite got into the habit of ignoring existing legislation and the benchmark rules for ethical behaviour set by the founding fathers of their country. Commodore Cornelius Vanderbilt, who had, way before Richard Fuld did, learned to put money above law, doubted that he had any real use for law. Vanderbilt said, ”What do I care about law? Ain’t I got power?” The American credit crunch is rooted in many factors such as an unaffordable arms race, the enormous, 10-trillion-dollar (271.07 trillion roubles. 7.884 trillion euros. 6.292 trillion UK pounds) public debt, the huge budget deficit… but there’s more to it. A few days ago, the leading hierarchs of the world’s Orthodox Christian Churches declared in Istanbul that the current economic crisis was a result of two things, perversely-planned and inhuman economic policies that ignored the real needs of the people, and an often maniacal passion for a higher profit margin. Today’s generation of denizens on the Potomac would rather close their eyes to those things and keep silent. Just the wrong thing to do!
24 October 2008
Valentin Zorin
Voice of Russia World Service
http://www.ruvr.ru/main.php?lng=eng&q=34178&cid=170&p=24.10.2008
The “Not-so-Special” Relationship
Tags: banking, Barclays, Ben Bernanke, Bernie Madoff, Bob Diamond, BP, Bretton Woods Agreement, Business and Economy, Deepwater Horizon, Deepwater Horizon oil spill, DICK CHENEY, drug cartels, drug trade, drug trafficking, Economic, economics, economy, Great Britain, Halliburton, HSBC, Iran, iranian economy, Iraq, Iraq War, London, Mexico, New York, New York City, political commentary, politics, Special Relationship, Standard Chartered Bank, Tony Blair, United Kingdom, United States, US Federal government, US Federal Reserve, USA, Winston Churchill
______________________________
The Special Relationship is a phrase used to describe the exceptionally-close relation between the USA and Great Britain. Winston Churchill first coined it in a speech in 1946, and the Special Relationship covers the political, economic, diplomatic, cultural, military, and cultural spheres. The Special Relationship came into being at the same time as the Bretton Woods agreement, which, many believe (including me), is no longer relevant in the 21st century economy. Whilst we continue to hear that the USA and Great Britain still enjoy exceptionally close ties, much closer than with any other country, the evidence is mounting to suggest that the Special Relationship is, in fact, not so “special” anymore.
The latest episode in the not-so-Special Relationship is the attack on British banks by the Americans. The USA is accusing Britain’s Standard Chartered Bank of laundering some 250 billion dollars of transactions over 10 years for the Iranian régime, hiding some 60,000 transactions from American regulators. They did it with the help of American consultancies and accounting firms, but the most striking thing is that, throughout this 10-year period, the Special Relationship was continually held up as the basis for everything that’s gone on between the USA and Great Britain.
The Standard Chartered Bank affair comes hot on the heels of another British bank under immense pressure from the United States, HSBC. HSBC stands accused of laundering drug cartel money, specifically in Mexico. Rumours have long been abounded about banks laundering drug money, especially American banks. However, yet again, another British bank is getting all the limelight in the USA for all the wrong reasons, with no sign of the Special Relationship coming to the rescue!
Of course, another big British bank recently coming under the glare of publicity was Barclays; they blew the whistle on themselves over the Libor scandal. This time, Barclay’s American CEO Bob Diamond fell on the British Sword when it came time for heads to roll in the Libor scandal. Federal Reserve Chairman Ben Bernanke came out and said that he believed that Libor is structurally floored, which is true, yet, despite the Special Relationship, he was unable to voice his concerns prior to the scandal erupting or to work together to create a better system.
If we go back to the invasion of Iraq in 2003, Tony Blair used the Special Relationship to justify why he was so economical with the truth to the British cabinet about the legality of going to war. In fact, many would say that he simply lied under the cover of the Special Relationship. His premiership never recovered from this, nor it would seem has the Special Relationship.
In 2010, BP suffered a horrendous oil spill in the Gulf of Mexico on their Deep Water Horizon platform, which resulted in nearly 5 million barrels of oil flowing into the ocean. BP had partners on the platform, one of which was the American oil services company Halliburton, which had connections to former-Vice President Dick Cheney. Far from stepping in to offer support to BP and taking some of the responsibility, the USA and Halliburton did the opposite, ensuring that BP took the blame publicly. One of the results of the Gulf oil spill was that the CEO of BP changed. It went from being headed by a British national to being led by a US national. Far from the Special Relationship offering economic support, in fact, it did the opposite, and a prize British asset remains under the leadership of an American.
The latest rumour is that New York is trying to edge London out as a global financial capital. This could explain why British banks are coming under attack from the United States. This is despite the fact that in 2008 the American banking system gave us Bernie Madoff, AIG, “too big to fail”, subprime lending, a frozen derivatives market, and a nation full of underwater mortgages. A defaulting European Union would be a disaster for the American banks that have underwritten all the credit default swaps on European debt, of course. It’d be like a biblical moment, insofar as credit default swaps are like insuring against a flood in the desert, and, right now, the clouds over the desert are very, very dark.
Whatever the truth is, the shape of the financial system is changing, and the Special Relationship really isn’t so special anymore. Instead of all capital flows going via either London or New York, the 21st century market model will see capital flows going directly between trading partners, on a peer-to-peer basis, and the USA and Great Britain will have to compete with each other for a piece of these flows, whether they are with Russia/Eurasian Union, China, the Middle East, Africa, or South Asia.
It seems that the US/Anglo banking cabal already understands the changing world, and whatever the rules of the Special Relationship were in the past, they no longer hold in a world of not-so-Special Relationships.
16 August 2012
Sam Barden
RIA-Novosti
http://en.rian.ru/columnists/20120814/175212767.html