Rothschild loses libel case, and reveals secret world of money and politics

Thanks to billionaire's legal battle, we now know a lot more about how the super-rich work

With his long limbs and delicate gait,  Lord Mandelson could no doubt manage a quite convincing turn in Thunderbirds.

He'd find Jeff Tracy most convivial: a billionaire astronaut with his own Pacific island, and now, it seems, he even has his own camera-shy friend to pull the strings.

According to the High Court, Nathaniel Rothschild, scion of the banking dynasty and friend of seemingly everyone in the spheres of finance, business and politics, is indeed "puppet master" to the Baron of Hartlepool and Foy.

The banker and Bullingdon boy has lost his libel case against the Daily Mail, which he sued for "substantial damages" over its account of his and Mr Mandelson's extraordinary trip to Russia in January 2005.

Mr Rothschild claimed he was subjected to "sustained and unjustified" attacks in the May 2010 article, which portrayed him as a "puppet master", dangling his friend Lord Mandelson in front of the Russian oligarch Oleg Deripaska to ease the passage of colossal business deals.

Messrs Rothschild and Mandelson's Russian trip would certainly have made entertaining viewing, but maybe not for Thunderbirds fans. Nobody needed rescuing, that's for certain.

It began on Mr Rothschild's private jet from the World Economic Forum in Davos to Moscow, where they met Mr Deripaska, the aluminium plant manager who became the richest oligarch of them all, and continued on Mr Deripaska's private jet to his chalet in Siberia, where "to beat jet lag" they were whipped with birch leaves before plunging themselves into icy water – a traditional Siberian banya.

Less salacious, but seemingly more sordid, was an earlier dinner at Cantinetta Antinori, a fashionable Tuscan restaurant in Moscow. Mr Deripaska, the Mail had claimed, was dining with executives from the US aluminium giant Alcoa, negotiating a £250m deal to buy two of Mr Deripaska's aluminium plants, at which a stumbling block was an EU import tariff on Russian aluminium. Enter Lord Mandelson, then a lowly Mister, but at the time the EU Trade Commissioner. The deal is done, costing several hundred British jobs, and the tariffs come down.

Mr Rothschild claimed the trip was "purely recreational", and Associated Newspapers had to admit during litigation that it couldn't be sure that Mr Mandelson had joined Mr Deripaska at dinner or whether aluminium tariffs were discussed, and in fact the deal had been struck before Mr Mandelson and Mr Rothschild arrived in Moscow. But for Mr Justice Tugenhadt, recreation it was not.

"So far as Lord Mandelson was concerned the benefit was the trip and the hospitality itself. So far as Mr Deripaska was concerned it was a relationship with the EU Trade Commissioner," he said in his ruling. The judge rejected the notion that Mr Rothschild and Mr Mandelson had flown out as friends, not business associates, and said Mr Rothschild's behaviour had in part been "inappropriate". "That conduct foreseeably brought Lord Mandelson's public office and personal integrity into disrepute," the judge said.

Mr Rothschild's "different and developing" accounts of the Siberia trip were confusing, he continued, adding that on this subject the banker had not been entirely candid.

Mr Rothschild said he was disappointed with the judgement and intended to appeal. "The truth is, as the Daily Mail has now accepted, that I had nothing whatsoever to do with this deal and that it had in any event been completed before Lord Mandelson and I even arrived in Moscow," he said in a statement. Disputing the judge's findings, he added: "Lord Mandelson's trip to Russia was entirely recreational – as the court has accepted – and Lord Mandelson had obtained clearance for the trip from his office before undertaking it."

Puppet masters, of course, do not like the limelight, but when one pulls quite as many strings as Mr Rothschild would appear to, things will inevitably go wrong. Indeed, it is not the first time this seemingly unlikely trio has conspired to make the headlines. When Mr Deripaska moored his yacht next to the Rothschild family villa in the summer of 2008, they, along with George Osborne, managed to tie themselves up in an even more spectacular imbroglio.

Either on the yacht or in the villa, Lord Mandelson might have said unkind things about Gordon Brown and Mr Rothschild is alleged to have suggested that Mr Deripaska might be interested in making a donation to the Tories. Via the two politicians it all ended up in the press – the last place their two hosts like seeing themselves.

That leading politicians, bankers and businessmen associate with each other in fashions that blur the boundaries between work and pleasure is a secret too great to be maintained with any success, but it doesn't make the details, on the rare occasions they actually emerge, any more palatable.

A spokesman for the Daily Mail said: "This case is a reminder, at a time when newspapers are under attack for invading privacy, that the rich and powerful regularly use the law to prevent legitimate scrutiny of their activities. Had the Mail lost this case, it could have incurred costs of more than one million pounds.

"Not many news organisations, however committed they are to free speech, can afford to risk a loss of that magnitude. As Lord Justice Leveson's inquiry considers the balance between privacy and freedom of expression, the chilling effect on free speech that court cases like this one exert needs to be borne in mind."

http://www.independent.co.uk/news/uk/home-news/rothschild-loses-libel-case-and-reveals-secret-world-of-money-and-politics-6720015.html

The predatory lending industry had a partner in the White House: Why Eliot Spitzer was assassinated

Mortaging America's future
for a quick buck

This video was originally posted in March of 2008

It's one of the most amazing displays of journalistic incompetence and malpractice in recent memory.

The US news media failed to draw the obvious connection between the bizarre federal law enforcement investigation and leak campaign about the private life of New York Governor Spitzer and Spitzer's all out attack on the Bush administration for its collusion with predatory lenders.

While the international credit system grinds to a halt because of a superabundance of bad mortgage loans made in the US, the news media failed to cover the details of Spitzer's public charges against the White House.

Yet when salacious details were leaked about alleged details of Spitzer's private life, they took that information and made it the front page news for days.

To the 9/11 fiasco, the Iraq War, the travesty of the federal response to Hurricane Katrina, and the shredding of the US Constitution, we can now add a deliberate and reckless undermining of the credit and banking system of the US to the list of Bush administration "accomplishments."

No external enemy, or group of external enemies, could have done as much harm to the nation as this group has in less than eight years.

Hey, do you think it's a coincidence that a Bush was involved the last time the US banking industry fell into a black whole because of White House-facilitated fraud?

There's actually a lot of money to be made blowing up banks. Here's how Bush Sr. and his friends in the Mafia and CIA profited from it the last time:

Bush, the Mafia, the CIA and the Savings and Loan Scandal

http://www.brasschecktv.com/page/291.html

It's Time to Join the Resistance

"What country can preserve its liberties, if its rulers are not warned from time to time that this people preserve the spirit of resistance?"-- Thomas Jefferson

Over the past few months, I've heard from many Americans who feel they've lost the power to be heard by their government. From the repeated assaults on our civil liberties to the financial ruin brought about by irresponsible corporations and government officials, Americans feel helpless and beaten down.

Faced with a government that is not heeding their demands, many are simply giving up. But we are far from helpless, and this is not the time to surrender our rights.

Too often, we forget that America began with a revolution. America was born out of the sheer grit and determination of a rebellious group of colonists. These freedom fighters stood their ground. They knew they had rights. And when those rights were systematically violated, they resisted.

Thankfully, there are a growing number of Americans--what I like to refer to as "teaspoons of resistance"--who have not given up the fight and are choosing to exercise their First Amendment right to peaceably assemble and "petition the Government for a redress of grievances."

There are many examples. Let me cite a few. In more than 40 cities across the country, growing numbers of Americans have been taking to the streets and staging "tea party protests" to voice their objections to the government's out-of-control spending and its bailout of mega-corporations and bad mortgages. Although no tea is being tossed at these protests, they are gaining in popularity as a way for citizens to express their discontent with government spending gone haywire. In fact, organizers are planning a nationwide Tax-Day Tea Party protest.

Mindy McAlindon of Franklin, Tennessee, is taking a slightly different approach in voicing her discontent about the economy. She plans to bombard the White House with actual tea bags and protest notes. Protesters in other cities are planning to do the same for members of Congress.

More than 10,000 demonstrators in 100 locations across the country recently gathered at the offices of major banks whose behavior both before and since the government bailout "epitomize an era of CEO and corporate excess at the expense of broader prosperity that has weakened the economy."

Thousands will soon travel to Washington, DC, to protest the wars in Afghanistan and Iraq. The rally, which will take place the day after the sixth anniversary of the U.S. invasion of Iraq, will reportedly be the first national antiwar demonstration in the United States since President Barack Obama took office.

And then there is Concepcion Picciotto, a small woman in her late 60s who has carried on the longest continuous act of protest in the United States. Since 1981, Picciotto has staged a round-the-clock peace vigil across from the White House in Lafayette Park in the hopes of ending U.S. interventionist wars and banning nuclear weapons. She has thus far managed to outlast four presidents--Ronald Reagan, George Bush, Bill Clinton, and George W. Bush--and she's planning to outlast Barack Obama.

To fellow activists, Picciotto is a living symbol of resistance and an amazing example of grassroots democracy who understands that power is with the people. Unfortunately, her vigil has not been without its trials. Over the course of the past 28 years, Picciotto says she has been cursed at, spat on and beaten up, arrested and issued $50 citations for illegal "camping" in the park. Nevertheless, she persists in her solitary vigil.

We could use more tireless freedom fighters such as Concepcion Picciotto today. Yet she is merely one of a long and historic line of Americans to stage populist protests in the form of sleep-ins, sit-ins and marches to oppose government policies, counter injustice and bring about change.

For example, in May of 1932, more than 43,000 people--World War I veterans and their families-- marched on Washington. Out of work, destitute and with families to feed, the veterans set up tent cities in the nation's capital and refused to leave until the government agreed to pay the bonuses they had been promised as a reward for their services. The Senate voted against paying them immediately, but the protesters didn't budge. Congress adjourned for the summer, and still the protesters remained encamped. Finally, on July 28, under orders from President Herbert Hoover, the Army descended with tanks and cavalry and drove them out, setting their makeshift camps on fire. Still, the protesters returned the following year, and eventually their efforts not only succeeded in securing payment of the bonuses but contributed to the passage of the G.I. Bill of Rights.

Thus, while protests and acts of resistance may not always achieve immediate results, they're a good place to start. Time and again throughout our nation's history, real change has come at the urging of the people. After all, governments aren't proactive, they're reactive. They only move when you urge them to move. The Civil Rights movement of the 1960s is a perfect example. Just imagine how much longer it would have taken to gain equality for African-Americans without the efforts of Martin Luther King Jr., Rosa Parks and so many other fearless black Americans.

Clearly, this is no time to stand silently on the sidelines. It's a time for anger and reform. Most importantly, it's a time for making ourselves heard. And there is no better time to act than the present. As Robert F. Kennedy reminded his listeners in a speech delivered at the University of Cape Town in 1966, "Hand in hand with freedom of speech goes the power to be heard, to share in the decisions of government which shape men's lives. Everything that makes man's life worthwhile--family, work, education, a place to rear one's children and a place to rest one's head--all this depends on decisions of government; all can be swept away by a government which does not heed the demands of its people."

What can ordinary citizens do? Instead of sitting around and waiting for someone else to change things, take charge. Never discount the part that everyday citizens play in our nation's future. You can change things, but there can be no action without education. Get educated about your rights and exercise them. Start by reading the Bill of Rights. You can do so online at www.rutherford.org. Or, if you want a copy to keep with you, email me at johnw@rutherford.org and I'll send you a free one.

Most important of all, just get out there and do your part to make sure that your government officials hear you. The best way to ensure that happens is by never giving up, never backing down, and never remaining silent. To quote Dr. King, "If you can't fly, run; if you can't run, walk; if you can't walk, crawl, but by all means keep moving."

It doesn't matter whether you're protesting the economy, the war, the environment or something else altogether. What matters is that you do your part. As that great revolutionary firebrand Samuel Adams pointed out, "It does not require a majority to prevail, but rather an irate, tireless minority keen to set brushfires in people's minds."

Take some time right now and start your own brushfire for freedom. In the words of one Tea Party organizer, become "10-minute citizens. Take 10 minutes, six days a week and learn about the issues, and then call politicians, or email them, or call talk radio, or write letters to the editor and make your voice heard."

It's midnight in America right now. But the real question is, will there be a dawn? That's up to you and me. The future is in our hands.

http://www.huffingtonpost.com/john-w-whitehead/its-time-to-join-the-resi_b_176270.html

Was Eliot Spitzer Taken Out Because He Was Going to Bust AIG? YES!

Posted by Melina Ripcoco, Brilliant at Breakfast at 3:39 PM on March 19, 2009

America is known for its great second acts, and we may be witnessing the curtain rising on Spitzer's.

Eliot Spitzer is back and he's talking. The thought of this, no doubt, brings a small shiver to the boardrooms of some of the perps walking around trying to figure out how to hide the money this week. Today Edward Liddy testified that there have been death threats made to or about executives who received bonuses, so no names will be put on the record, but these anonymous players must know that the jig is up in the land of easy-money. Isn't what to do a no-brainer for these great Americans?

Spitzer may be as "disgraced" as any anonymous sex loving Republican loser, but America is known for its great second acts, and we may be witnessing the curtain rising on Spitzer's.

Today in Slate Eliot Spitzer has a short op-ed that speaks volumes about what is going on, and indirectly, if you follow the money, what happened to him. Plainly stated, Spitzer brings the AIG Ponzi Scheme one step closer to the revered establishment when he explains how the bailout money was funneled straight into the top players, with Goldman Sachs being the name that comes up again and again. These top players already got bailout money, and Goldman is looking at zero losses at this point, while regular Americans are being asked to make concessions or just plain losing everything. here are the biggest financial entities in the world, making billions on what appears to have been nothing but air traded back and forth, and having gutted the American people they are walking away with 100% return to their stockholders. In return AIG seems to think that its appropriate to pay themselves bonuses with the leftover funds. This leaves AIG still a wobbly shell with no plan of how to go forward, and the threat of the collapse of all of the world's financial markets still up in the air. So, what was all that bailout money for? Apparently to make sure that no one at Goldman or the other few top firms in the hand-out-line lost anything!

The relationship between AIG and Goldman goes back long enough that one would think that Goldman would know, having bought so much of this "insurance" or whatever it was, whether the "products" were ...er...real or feasible at all. Indeed, Goldman and AIG almost merged a few years ago, but Spitzer notes that the unknown black hole of AIG's business practices were probably what prevented it. Still, that didn't stop the incestuous dealings; it almost makes one think that this whole thing was a setup.

This is country that Spitzer is familiar with; he has been a terrible liability to entities that, under the Bush administration, were allowed to literally gut the country and its citizens. All of this seems to have been part of the Bush Administration's own Ponzi Scheme, which figured that the illusion of an ownership society, terrified of the "terraism" and steeped in the me, me, me, culture would look the other way while they finished clearing out the vault. Beyond that, it's clear that the media hyped housing bubble encouraged the house flip mentality and the idea that anyone could be rich. The idea of the lottery dropping on our own heads made us more protective of the rich, because we might one day be one....or look, we could be one with no money down, if we could just balance that on this, and flip that house!!

Every week came a new offer from our bank or credit card to just put the enclosed check into the bank for a $50,000 loan, unsecured and with a low APR!! Who would know that those same banks would go out of their way to cause a day or week default by changing the cycle or stopping refusing cards that went over-limit, in order to charge fees and raise the rates. Who could know that the fine print on all those little fliers talking about privacy rights and how they are selling all of our information, also said that by-the-way the interest rate is now 25% and the minimum payment has tripled! Default on that and likely AIG has sold insurance to your lending institution that should repay them for making the bad loan in the first place....no money down mortgages? No problem....its the same story. This is the ownership society and we all need to own alot of stuff. It is... what did he say?...uniquely American!

Spitzer was questioning this back in February 2008 when he wrote his Valentine to predatory lenders in the Washington Post. He detailed that Attorneys General across the country had entered into litigation in an attempt to protect the people of their states from predatory lending. The response from the federal government was astounding!

What did the Bush administration do in response? Did it reverse course and decide to take action to halt this burgeoning scourge? As Americans are now painfully aware, with hundreds of thousands of homeowners facing foreclosure and our markets reeling, the answer is a resounding no.

Not only did the Bush administration do nothing to protect consumers, it embarked on an aggressive and unprecedented campaign to prevent states from protecting their residents from the very problems to which the federal government was turning a blind eye.

In 2003, during the height of the predatory lending crisis, the OCC invoked a clause from the 1863 National Bank Act to issue formal opinions preempting all state predatory lending laws, thereby rendering them inoperative. The OCC also promulgated new rules that prevented states from enforcing any of their own consumer protection laws against national banks. The federal government's actions were so egregious and so unprecedented that all 50 state attorneys general, and all 50 state banking superintendents, actively fought the new rules.

But the unanimous opposition of the 50 states did not deter, or even slow, the Bush administration in its goal of protecting the banks. In fact, when my office opened an investigation of possible discrimination in mortgage lending by a number of banks, the OCC filed a federal lawsuit to stop the investigation.

Now, they will say that they fought the consumer protection laws to actually protect the consumers and assure that they could get credit in the future. But actually, Americans could get credit; just credit that they were able to handle and could, by reasonable standards, pay back. This was just more of the same in hindsight. Looking back that all that the Bush administration has done, the beginnings of this disaster looks almost quaint, and not like an institutionalized foray into the dirty underside of criminal activity. There were quotas passed by the government as to who got the loans and the focus was on certain populations who would be helped into homeownership even if they couldn't maintain the credit. It was treated as some sort of fulfillment of the American Dream for people to own something, but really had more to do with the insurance on the loans than the people involved. The American dream is dead, as we well know, but what it was, way back then, was that people could afford to own a house and put their kids in college!

AIG sold insurance to the biggest entities in the financial world to cover the proliferation of bad loans. This insurance became so common that it was impossible that the lions of finance didn't somehow have an inkling that something was wrong. Didn't Goldman and the rest of these huge firms know something about the stability of an impossible business plan? Hadn't Goldman gone over everything in their bid to merge? And what of the government and their mandating of certain loans that were bound to go bad. There were people involved in these things, and its not like regular people understand the ins and outs of the financial industry. They rely on brokers to explain it to them. But these brokers were being forced to see a certain product to an unqualified population. How could they? Why would they? Those are questions for another time.

Spitzer has been fighting these guys and asking questions all along.

Coincidentally, right after the WSJ editorial appeared on Valentine's Day 2008, Spitzer was caught up in what was an extremely unusual sting. So unusual is an investigation like this that it seems almost like it was a set-up; and considering where it all came from and how it all came down, it might well have been.

It seems that Spitzer's bank was investigating expenses under the auspices of the newer Homeland Security laws of the Bush administration.

Greg Palast wrote about this compellingly, and in light of how the whole thing is shaking out now, and what Spitzer said back then about this financial mess and what he tried to DO about it, Palast had a pretty good early grasp on what had gone down. So now, with Spitzer poking his head up from the underground of "healing his family," at this most compelling of moments, its probably worthwhile for Americans to screw their heads on straight and forget the details of the hooker, and look at what Spitzer was working on when he was taken down. We might all find ourselves wanting to thank the egotistical crime fighter who cant keep it in his pants.

I am no apologist for breaking the law, and usually its the highest and mightiest that fall the hardest. But when the mainstream is showing us the shiny object, we must resist the temptation to succumb to our base natures and try to see the bigger picture. There was never a real case against Eliot Spitzer, and no charges were filed. The release of embarrassing personal information was at the discretion of the Bush Administration's Justice Department.

Why was this information released? It wasn't that he was a crusader against such crimes, because many who have been caught were exactly the same and their information has been kept quiet. It wasn't that the press is all so great in their investigative journalism, either...because we know they're loathe to get off their asses if they can just read a talking point; as is evidenced by the reportage on this case.

Palast

Not all crimes lead to federal bust or even public exposure. It’s up to something called “prosecutorial discretion.”

Funny thing, this ‘discretion.’ For example, Senator David Vitter, Republican of Louisiana, paid Washington DC prostitutes to put him in diapers (ewww!), yet the Senator was not exposed by the US prosecutors busting the pimp-ring that pampered him.

Naming and shaming and ruining Spitzer – rarely done in these cases - was made at the ‘discretion’ of Bush’s Justice Department.

Or maybe we should say, 'indiscretion.'

Bush's Justice Department.

Its clear to me that all things being equal, this was at the very least, not a transsexual streetwalker a la Hugh Grant, and it was all very ho-hum and quiet. So, whatever the problem that leads to this sort of behavior, I don't want to know about it...its personal, so just walk on by...nothing to see here.

Welcome back Eliot Spitzer. I hope we hear more from you very soon...your voice is needed in this matter.

c/p RIP Coco

http://www.alternet.org/blogs/peek/132547/

Spitzer on AIG: I told you so

A.I.G. Sues U.S. for Return of $306 Million in Tax Payment

Spitzer on AIG: I told you so

The Associated Press

6:45 PM EDT, March 19, 2009

Eliot Spitzer has a few words to say about the AIG bonus brouhaha: I told you so.

The former New York governor battered American International Group with charges of corruption long before his own dizzying downfall in a prostitution scandal. He has used this latest financial scandal to strike his old populist, Sheriff of Wall Street themes and, just maybe, mend his reputation -- though critics contend that he bears a share of the blame for the insurance giant's historic near-collapse.

Spitzer says the AIG bonus issue is "penny ante" compared to the billions of the insurer's bailout money funneled to bad banks, and that Treasury Secretary Timothy Geithner owes America an explanation, quickly.

As for all those politicians piling on AIG this week? Been there. Done that.

Former Gov. Eliot Spitzer won't be facing federal charges in the prostitution case (political assassination for blowing the whistle on AIG corruption, Goldman Sachs and the connection to the US Government and Federal Reserve) he was linked to, officials said. (Patrick McCarthy, Freelance / March 15, 2008)

"We pursued AIG and Wall Street's structural failures in a way that others shied away from because it was politically unpalatable for them to address those issues," Spitzer told host Brian Lehrer Wednesday on WNYC Radio in New York City. "Now it is the flavor of the month. Everybody is jumping up and down serving subpoenas, beating their chests trying to be tougher than the next person."

On CNN Thursday, Spitzer said his initial probes came from AIG's "effort from the very top to gin up returns whenever, wherever possible and to push the boundaries in a way that would garner returns almost regardless of risk.

"Back then I said to people, AIG is the center of the web," he told CNN's Fareed Zakaria.

Spitzer pursued AIG for years when he was New York's attorney general. The company eventually announced in 2006 that it would pay $1.64 billion to resolve allegations that it used deceptive accounting practices to mislead investors and regulatory agencies.

AIG's veteran chief executive officer, Maurice "Hank" Greenberg, was forced to resign in 2005 after a long and contentious, sometimes ugly battle with Spitzer.

"He obviously believes history has vindicated him," said John Coffee, a professor of securities law at Columbia University, "and wants to remind America that he was there first."

The tough talk raises the question about whether Spitzer, who now tends to his family's real estate business, is mounting a comeback bid.

It would be a long shot. The trail for a married politician caught soliciting high-priced prostitutes would likely be prohibitively steep. For someone like Spitzer, who became governor largely because of his Mr. Clean reputation, it would be even tougher.

And anyway, when he resigned last March, Spitzer promised to work for the common good "outside of politics." Spitzer politely declined to talk about AIG or other issues when contacted Thursday by The Associated Press.

"I've got a day job now," he said.

Coffee suspects Spitzer is more concerned about reclaiming a legacy than mounting a comeback. Jeffrey Stonecash of Syracuse University's Maxwell School said the recent comments fit Spitzer, a natural crusader zealous about rooting out financial crimes.

"He really does have a strong moral streak, as weird as that may sound given what happened to him," said Stonecash, who teaches political science. "This provides him an opportunity not only to express that concern, but maybe to resurrect himself."

Clearly, Spitzer's year in the wilderness not dampened his appetite for a fight.

Writing for the online magazine Slate this week, Spitzer contended the real disgrace with the AIG bailout is not the $165 million in bonuses to executives, but the billions in AIG bailout money that was funneled to the insurer's trading partners -- that is, shaky banks that taxpayers are already bailing out.

"The appearance that this was all an inside job is overwhelming," Spitzer wrote in Slate. "AIG was nothing more than a conduit for huge capital flows to the same old suspects, with no reason or explanation."

Spitzer's comments have the side effect of highlighting controversies about his dogged pursuit of AIG and Greenberg.

Critics, mostly on the political right, claim that by forcing out Greenberg and creating turmoil at AIG, Spitzer laid the groundwork for the debacle roiling the country today. They note that Spitzer eventually dropped some of his charges against Greenberg, that Greenberg hasn't been found guilty of other charges, and that Greenberg continues to fight back in court.

Spitzer seems unconcerned. Even as he declined to talk to the AP, he indicated he was not done with AIG.

"I'll be writing more about it," he said.

In 2002, AIG gave $5,000 to Eliot Spitzer's second campaign for attorney general. State records show the company has given nothing to his successor in that job, Andrew Cuomo, who is now hitting AIG over the bonuses.

http://www.newsday.com/news/local/state/ny-stspit0320,0,7580345.story

A.I.G. Sues U.S. for Return of $306 Million in Tax Payments

AIG — There are Many Criminals Here

Was Eliot Spitzer Taken Out Because He Was Going to Bust AIG?

A.I.G. Sues U.S. for Return of $306 Million in Tax Payments

Katie Orlinsky for The New York Times

Demonstrators marched in New York’s financial district Thursday to protest corporate excesses.

 

By LYNNLEY BROWNING

Published: March 19, 2009

While the American International Group comes under fire from Congress over executive bonuses, it is quietly fighting the federal government for the return of $306 million in tax payments, some related to deals that were conducted through offshore tax havens.

A.I.G. sued the government last month in a bid to force it to return the payments, which stemmed in large part from its use of aggressive tax deals, some involving entities controlled by the company’s financial products unit in the Cayman Islands, Ireland, the Dutch Antilles and other offshore havens.

A.I.G. is effectively suing its majority owner, the government, which has an 80 percent stake and has poured nearly $200 billion into the insurer in a bid to avert its collapse and avoid troubling the global financial markets. The company is in effect asking for even more money, in the form of tax refunds. The suit also suggests that A.I.G. is spending taxpayer money to pursue its case, something it is legally entitled to do. Its initial claim was denied by the Internal Revenue Service last year.

The lawsuit, filed on Feb. 27 in Federal District Court in Manhattan, details, among other things, certain tax-related dealings of the financial products unit, the once high-flying division that has been singled out for its role in A.I.G.’s financial crisis last fall. Other deals involved A.I.G. offshore entities whose function centers on executive compensation and include C. V. Starr & Company, a closely held concern controlled by Maurice R. Greenberg, A.I.G.’s former chairman, and the Starr International Company, a privately held enterprise incorporated in Panama, and commonly known as SICO.

The lawsuit contends in part that the federal government owes A.I.G. nearly $62 million in foreign tax credits related to eight foreign entities, with names like Lumagrove, Laperouse and Foppingadreef, that were set up or controlled by financial products, often through a unit known as Pinestead Holdings.

United States tax law allows American companies to claim a credit for any taxes paid to a foreign government. But the I.R.S. denied A.I.G.’s refund claims in 2008, saying that it had improperly calculated the credits. The I.R.S. has identified so-called foreign tax-credit generators as an area of abuse that it is increasingly monitoring.

The remainder of A.I.G.’s claim, for $244 million, concerns net operating loss carry-backs, capital loss carry-backs, a general refund claim and claims for refunds of other tax-related payments that A.I.G. says it made to the I.R.S. but are now owed back. The claim also covers $119 million in penalties and interest that A.I.G. says it is due back from the government.

In part, A.I.G. says it overpaid its federal income taxes after a 2004 accounting scandal that caused it to restate its financial records. A.I.G. says in part that it is entitled to a refund of $33 million that SICO paid in 1997 as compensation to employees, which it now says should be characterized as a deductible expense.

A.I.G.’s lawyers in the case, at Sutherland Asbill & Brennan, referred calls to the company. Asked about the lawsuit, Mark Herr, an A.I.G. spokesman, said Thursday that “A.I.G. is taking this action to ensure that it is not required to pay more than its fair share of taxes.”

http://www.nytimes.com/2009/03/20/business/20aig.html?_r=3

Also read:

Spitzer on AIG: I told you so

AIG — There are Many Criminals Here

Moral Decay Swirls Around Banking Bailout: Time for a Criminal Investigation

By Robert Scheer, Truthdig. Posted March 19, 2009

Those who stole billions in 401(k)s of innocent victims were rewarded handsomely, rarely needing to break the laws their lobbyists purchased.

There must be a criminal investigation of the AIG debacle, and it looks as if New York's top lawman is on the case. The collusion to save this toxic company in order to salvage the rogue financiers who conspired to enrich themselves by impoverishing millions is being revealed as the greatest financial scandal in U.S. history. Instead of taking bonuses, the culprits should be taking perp walks. 

I'm not just referring to the swindlers in the Financial Products Subsidiary of AIG who devised and sold those insurance policies on derivatives that brought the world economy to its knees. They do seem deserving of a special place in hell, and presumably the same divine power that according to Scripture labeled usury a high moral crime and threw the money-changers out of the temple will consider that outcome.

However, the enablers are the AIG leaders who, as New York Attorney General Andrew Cuomo revealed Tuesday, signed those bonus contracts a year ago to reward the very people "principally responsible for the firm's meltdown." That's a cool $44 million divided among the top 10 shysters, even though the depth of their chicanery was well known to top management. 

As Cuomo noted in a letter to Rep. Barney Frank: "The contracts shockingly contain a provision that required most individuals' bonuses to be 100% of their 2007 bonuses. Thus, in the spring of last year, AIG chose to lock in bonuses for 2008 at 2007 levels despite obvious signs that 2008 performance would be disastrous in comparison to the year before."

The lame argument that those bonus-baby employees needed to be retained in order to sort out the mess they had created was also shot down by Cuomo, who revealed after his office's initial investigation had pierced AIG's veil of secrecy that "[e]leven of the individuals who received 'retention' bonuses of $1 million or more are no longer working at AIG, including one who received $4.6 million."

But the $165 million in taxpayer funds used to reward them is but a sideshow in a far larger drama of moral decay swirling around the banking bailout. It should not distract from the many billions, not paltry millions, of our dollars being diverted to reward the very folks who brought us such misery. Consider the $12.8 billion of the $170 billion that taxpayers gave AIG in bailout funds that AIG then secretly diverted to Goldman Sachs, a company that evidently has a lock on both the Treasury Department and the Federal Reserve no matter which political party is in power. It was the biggest payoff among those that AIG made to a score of foreign and domestic financial giants.

The bailout is a response to a banking crisis that resulted from the radical deregulation pushed by former Goldman Sachs honcho Robert Rubin when he was President Clinton's treasury secretary. Another Goldman Sachs chairman-turned-treasury-secretary, Henry Paulson, in the Bush administration designed the trillion-dollar bank bailout that will go down as the greatest swindle in U.S. history.

It was because of Paulson that AIG was saved from bankruptcy hours after Goldman rival Lehman Brothers was allowed to go down the drain. Why that reversal of strategy in a top-secret meeting called by then New York Fed Chair Timothy Geithner, a Rubin protégé and now Barack Obama's treasury secretary? Why was Goldman's Lloyd Blankfein the only financial industry CEO in attendance? When that news leaked out, his role was defended as that of a noninvolved concerned citizen with expert knowledge, and whose firm had no direct monetary stake in the outcome.

That was a lie. 

Goldman Sachs was into AIG insurance policies for at least $20 billion, which is why the firm got that $12.8 billion while Paulson was in charge. It took six months for the embarrassing facts to finally come out. The bailout program was administered by Neel Kashkari, a former Goldman Sachs VP; why are we not surprised at that?

Another pretend innocent in all this is AIG's CEO Edward M. Liddy, famed defender of the $440,000 AIG executive retreat in Monarch Beach, Calif., held on the heels of the taxpayer bailout. His actions now are defended as mistakes made by a well-intentioned outsider who decided to work for a dollar a year after Paulson appointed him head of AIG. That is just garbage. 

Liddy was complicit in Goldman Sachs' role in creating this mess. As a director of Goldman Sachs, he was paid $685,770 in 2007 and would have come in for some questioning if the firm had gone down. Liddy even headed its audit committee during the five years before he resigned that seat to take over AIG in September 2008. As for his salary sacrifice, not to worry; in 2005, when he was still CEO of Allstate Insurance, he received $26.7 million in compensation.

What we have here is a rare glimpse into the workings of the billionaires' club, that elite gang of perfectly legal loan sharks who, in only the most egregious cases, will be judged as criminals -- Bernard Madoff, former chairman of NASDAQ, comes to mind. These other amoral sharks, who confiscated billions from shareholders and the 401(k) accounts of innocent victims, were rewarded handsomely, rarely needing to break the laws their lobbyists had purchased. 

Robert Scheer is Editor in Chief of Truthdig and author of a new book, The Pornography of Power: How Defense Hawks Hijacked 9/11 and Weakened America.

http://www.alternet.org/workplace/132298/moral_decay_swirls_around_banking_bailout%3A_time_for_a_criminal_investigation/

More wallstreet bailout news:

13 firms receiving bailouts owe back taxes --Rep. John Lewis: Two companies owe over $100 million apiece 19 Mar 2009 At least 13 firms receiving billions of dollars in bailout money owe a total of more than $220 million in unpaid federal taxes, a key lawmaker said Thursday. Rep. John Lewis, chairman of a House subcommittee overseeing the federal bailout, said two firms owe more than $100 million apiece. "This is shameful. It is a disgrace," said Lewis, a Georgia Democrat. "We are going to get to the bottom of what is going on here." [No, you won't. DemocRATs are too afraid to mention, let alone, blame - Bush's deregulation and giveaway of the National Treasury. Due to Obama's cowardice on that front (and electronic 'voting' machines), the GOP may sweep the 2010 and 2012 elections. By next year, the corporate-run media will have the entire collapsed economy pinned to Barack Obama and the Democrats. Witness the vitriol directed at Sen. Chris Dodd of Connecticut - as if *he* was/is the architect of the Bush Depression and feed the critters in the AIG swamp! --LRP]

Auto parts suppliers to get $5 billion in taxpayer aid 19 Mar 2009 The Treasury Department, trying to stabilize the battered [because they refuse to make fuel-efficient vehicles] auto industry, said Thursday it will provide up to $5 billion in financing to troubled auto parts suppliers who are linked to Detroit's carmakers. The funds would be made available from the government's Troubled Assets Relief Program, or TARP, said members of the Obama administration's auto task force.

House approves bill to tax AIG bonuses at 90% 19 Mar 2009 Responding to the anger about bonuses paid to AIG traders, the House approved a bill Thursday that would impose a punitive 90% tax on bonuses paid by American International Group Inc. and other financial companies that receive federal help. The vote was 328-93. The bill would apply to bonuses of people making more than $250,000 a year, and would apply only to payments from companies getting more than $5 billion from the federal government.

ROME IS BURNING, NERO IS FIDDLING

By Lynn Stuter

March 17, 2009
NewsWithViews.com

Did you know that the White House is being bombarded by “minutiae?” That the president’s personal aid is a “hunk”? That his speech writer has a “buzz cut?”

While America slides precipitously toward an all-out economic depression, while Also Known As (AKA) Obama continues to break every promise he made on the campaign trail, this is what the New York Times thinks is important for people to know!

Wow, aren’t you just really impressed?

And the lamestream media wonders why people are turning off their television sets, terminating their newspaper subscriptions, and using their computers to access alternative media sources and joining news loops to learn what is really going on in this nation.

This past week the Senate passed HR 1105, the Omnibus Appropriations Act of 2009, complete with close to 9,000 earmarks, $410 billion in spending, the largest spending bill ever passed, appropriating money that the United States does not have. This on top of the $787 billion in pork (H.R. 1) passed by Congress and signed by AKA on February 17, 2009, appropriating money out of thin air to spend on favored projects like building a new overpass across Highway 520 in Redmond, Washington to ease congestion caused by Microsoft.

Payback to Bill Gates for his generous donations to the Obama campaign and inauguration party? Isn’t that the definition of pay-to-play — “You give me a donation and I’ll make sure you are compensated out of the coffers of the taxpayers?”

Every economist worth his salt and the American people told Congress not to pass either of these bills; they did it anyway. At a time when government needs to be seriously downsized and taxes need to be seriously cut, AKA’s answer to the economic situation is to grow government and increase taxes.

Hey, who cares if the government spends money it doesn’t have in the bank. If you or I did that, we would be headed for prison. But what’s good for the people obviously isn’t good for the government; a double standard that violates equal access and equal justice under rule of law.

And we haven’t even begun to talk about AKA’s $3.6 TRILLION proposed budget for 2010 while AKA proclaims,

“These kinds of irresponsible budgets — and inexcusable practices — are now in the past. For the first time in many years, my administration has produced a budget that represents an honest reckoning of where we are and where we need to go.”

Not to mention Peter Orszag, director of the Office of Management and Budget, who assisted the Russian Government from September 1992 through August 1993, who asserts the “[d]eficit [will be] $2 trillion higher this year and next because of [the] crisis we inherited.”

The way AKA is spending money, we have to ask, “What crisis? We don’t see no stinkin’ crisis!” If there were truly a crisis, wouldn’t they be spending less instead of more; wouldn’t they be downsizing government instead of growing government? AKA didn’t “inherit” a crisis, he helped create the crisis, while a Senator, by voting for bailout after bailout, and since becoming the usurper-in-chief, signing bill after bill spending money this country doesn’t have to spend!

And while promising the tax increases will be on “the rich”; don’t bet on it. AKA doesn’t dare bite the hand that feeds him; the rich have the means to do him in so he isn’t going after them; he’s going to go after the middle class, just as has always happened when more money was needed. The cap and trade agenda, based on global warming junk science, is but one way that will happen. Watch for skyrocketing energy prices as carbon taxes and offsets come into play.

Not long in the White House, it is reported that AKA and company are holding extravagant parties on a weekly basis. Wagyu beef steaks costing $100 a pound (is there beef worth that kind of money?) are just the tip of the iceberg, it seems. Not long on the job, it seems AKA and company are “lonely,” absent the night life afforded them by the Chicago underworld.

“My fellow Americans, [pause for effect] while we wine and dine at your expense [pause for effect] while you are losing your jobs, homes, cars [pause for effect] truly [pause for effect] read my lips [pause for effect] we feel your pain [pause for effect] you have to believe that! [pause for effect] That’s what hope and change are all about.” [pause for applause]

With apparently a lot of time on their hands, maybe a course in how not to insult visiting heads of state would be a worthwhile investment of time! “Prime Minister Brown: We, the American people, wish to apologize for the impudence displayed by the White House …”

But then, maybe insulting the leaders of other nations is AKA’s idea of the “new era of responsibility,” fitting right in with the lewd, crude, coarse Alinsky style of community organizing? Look out, Congress, if you don’t bow to AKA’s agenda, those pledging their support on AKA's brown-shirt website may well conduct a sit-in in your bathrooms in support of their “messiah” and his Marxist mentor, Saul Alinsky!

While the lamestream media yawned, AKA appointed “American Taliban” member John Walker Lindh’s defense attorney, Tony West, as assistant attorney general in charge of the U.S. Justice Department's Civil Division. Of course, the fact that Mr West raised $65 million for AKA had nothing to do with his appointment, you understand!

This is in keeping with the stream of corrupt, tax dodging, conflict of interest nominees, including those forbidden lobbyists, that just keep cropping up like bad pennies in the AKA administration that was going to have none of that sort of thing going on. But hey, the Marxist pool of talent is so limited, don’t you know?

And lest pornography be left out of the equation, the senate last week confirmed David Ogden to the second-ranking position of deputy-attorney general; Ogden best known for his defending those accused of pornography. Maybe he can do something about those pornographic pictures that appear to be Stanley Ann Dunham circulating on the internet!

And to round out the debauchery, it seems that AKA now has his sights set on veterans. He thinks it would be a grand idea if, after they get shot up, blown up, and injured while fighting illegal “police actions” in far off places, that their health care needs be taken care of by private insurance. What a swell guy! Veterans should feel privileged that AKA shows such appreciation for their service to this country!! You just gotta believe he truly feels your pain!

And lest we forget, AKA has set about to reward unions for supporting his candidacy. On February 6, 2009, AKA signed executive order 13502 “encouraging” government contracts over $25 million include costly project labor agreements (PLA’s). PLA’s require that contractors and subcontractors agree to recognize that the union represents their employees. As 84% of all construction workers do not belong to a labor union, such actually represents a windfall to the unions at taxpayer expense, increasing the cost of construction projects substantially. But hey, what’s a few million here and a few million there. No problem, the taxpayers can afford it!

AKA also believes in the First Amendment guaranteeing free speech so long as it is he speaking freely and everyone else listens. When people speak out against his Marxist ideology, that isn’t free speech, that’s destructive to progress and those people must be held accountable. AKA, you understand, doesn’t believe in discrimination! And I have a bridge to nowhere I’ll sell real cheap!

And just so no one is left out, AKA is working diligently to socialize healthcare so you only get the care the government decides you need, forbids alternative medicine, vitamins, minerals and supplements that would undoubtedly be far more beneficial. Having your healthcare completely under government control means you will conform to the Marxist line or be denied life-saving healthcare.

The same applies to food. AKA is moving to destroy small farms, organic farms and your right to have your own garden (HR 875 and S 425), all under the guise of “food safety.” The goal is not food safety, which is truly a problem with commercial concerns, but controlling your ability to eat. If you want to eat, you will conform to the Marxist philosophy.

If, by this point in the AKA debauchery, people have not figured out that this man is a liar who couldn’t tell the truth if it would serve him better; an empty suit dangling from puppeteers strings; a snake oil salesman; a smooth talking con man; then there is no hope for change!

Americans are watching as AKA, with the help of the Democrat-controlled Congress and the Progressive Caucus, spends money like it was water running from a tap at a time when Americans are losing their jobs, homes and ability to feed themselves; throws extravagant parties while the American people suffer; and works feverishly to implement laws in the name of helping people that do nothing but further oppress the people.

It is becoming increasingly clear to all but the most ardent obamanoids that AKA is a narcissistic Marxist who lusts after power and cares not one iota for the plight of the people of this country. In short, he is dangerous to the continued freedom, liberty and justice afforded the American people by our Constitution and Bill of Rights. While playing to the poor, the downtrodden, the minorities, they are being used by AKA to get what he wants. And if he gets what he wants, which is absolute power, he will laugh at their gullibility in believing he would help them just as Hitler laughed at the downtrodden, poor and minorities who helped him gain absolute power.

Some, looking at AKA’s obvious excesses since moving into the White House — the spendthrift bills that will push this country into a full-blown depression, his extravagant partying at the expense of the people, his insulting of foreign heads of state, wonder if this is just a man out of his element or if this is deliberate.

Make no mistake, while AKA is obviously a man out of his element, his actions with regard to running this country into the ground are deliberate.

Any individual who has worked for a living knows that you cannot spend more than you make and get ahead of the game; that writing checks with no money in the bank to cover them is a one-way street to bankruptcy; that living beyond your means is a fools game.

Yet that is exactly what AKA is doing. And he is being aided in that by Representative Nancy Pelosi and Senator Harry Reid and the Democrat-controlled Congress.

AKA was, and may still be, a member of the Democrat Socialists of America (DSA) New Party; a membership that both he and the New Party have attempted to deny.

AKA hates everything this nation stands for. He is a Marxist, through and through, right down to those he associates with, including William Ayres and Bernadine Dohrn. People are known by the company they keep, even when they try to deny that relationship after twenty years of attending a church where anti-American hate is spewed from the pulpit and the victimology of Black Liberation Theology is the course served up exclusively.

And while AKA told the people that he was about “hope” and “change”, he has filled his administration with the same old anti-American, pro-globalist crowd from the Council on Foreign Relations, Trilateral Commission and Bilderberg group. The more things change, the more they stay the same!

The people have requested AKA prove his eligibility to the office he holds. While claiming his administration would be “transparent” and “open”, he has refused, spending hundreds of thousands if not millions on attorneys to keep that information from being made public. In this endeavor, the courts have been complicit, right down the line, offering various excuses — from standing, to the cases being “moot” after the fact, to being frivolous, to the eligibility issue being the duty of Congress. Congresses says the courts must decide the issue; the courts say it’s the duty of Congress. The same old blame game we’ve seen so many times before.

The evidence that AKA is not natural born, is not even an American citizen, is over-whelming to all but ardent obamanoid worshippers who run on the mantra “don’t confuse me with the facts.”

AKA is what he is and if the American people plan on saving this nation, they better come to the realization of what he is and give him the boot; sooner rather than later.

The emperor truly has no clothes!

© 2009 Lynn M. Stuter - All Rights Reserved

Activist and researcher, Stuter has spent the last fifteen years researching systems theory and systems philosophy with a particular emphasis on education as it pertains to achieving the sustainable global environment. She home schooled two daughters. She has worked with legislators, both state and federal, on issues pertaining to systems governance, the sustainable global environment and education reform. She networks nationwide with other researchers and a growing body of citizens concerned with the transformation of our nation from a Constitutional Republic to a participatory democracy. She has traveled the United States and lived overseas.

Web site: www.learn-usa.com

E-Mail: lmstuter@learn-usa.com 

http://www.newswithviews.com/Stuter/stuter147.htm