Barack Obama
Identity Politics and Israel’s Agenda
July 16, 2009 by Jeff Gates · Leave a Comment
The nomination of Sonia Sotomayor to the Supreme Court brings identity politics sharply into focus. Senate Judiciary Committee members are rightly concerned that bias and personal sympathies not take priority over the law. Those concerns provide a useful portal to assess a strategy deployed to undermine national security.
The use of identity to shape judicial decisions creates precedents unintended by lawmakers. In practical effect, those sympathies become law. Once precedents appear in court opinions, they can be expanded—again without support from legislators. Judicial activism relies on the steady expansion of precedent to broaden its impact. In similar fashion, the steady deepening of U.S.-Israeli relations reflects the impact of identity politics based on bias and personal sympathies.
But for the Holocaust, Harry Truman would likely not have recognized an enclave of Jewish extremists as a nation state. Opposition arose on all fronts, including strong objections from his Secretary of State, General George C. Marshall. Yet Truman’s bias as a Christian Zionist and his sympathies from a fundamentalist upbringing in rural Missouri led him to identify with the Jews’ return to Palestine as a means to hasten the Second Coming of the Christian Messiah.
While Truman conceded that the Zionists proclaimed a Jewish state, that is not what he recognized on May 14, 1948. Instead, he crossed out “Jewish state” and wrote the “State of Israel.” In the lead-up to that date, Truman was repeatedly assured by Zionist leaders that Israel was not intended to become a theocratic state. Yet sympathetic White House aides prepared for his signature a proclamation that would have established that precedent.
How do sympathy and empathy—whether of presidents, judges or members of Congress—alter what lawmakers intend? Is this a natural process? Or can identity politics also be deployed to manipulate? In the case of Israel, history points to historic and ongoing emotional exploitation.
Dangers of Identity Politics
Truman was a product of Kansas City’s Pendergast political machine. After the National Crime Syndicate was formed at a 1929 meeting in Atlantic City, that machine evolved into a key node in the node-and-network system of organized crime. In 1931, the syndicate’s nationwide operations were formalized in a Jews-only conclave at the Franconia Hotel in Manhattan where 24 exclusive territories were sanctioned, including five in and around New York City.
Truman was profiled, picked and “produced” to be placed in office—where he then behaved consistent with his profile. Known as “assets,” such pliable operatives do not have the state of mind that consciously connects them to what the “producers” seek to achieve. That leaves assets innocent of the intent required for criminal wrongdoing—yet complicit in the underlying objective.
Assets need only possess the requisite personality for the position. Those qualifications for office include the sympathies required to support the goals of Jewish organized crime. Thus the key role played by a Christian Zionist president in granting nation state status to a Zionist enclave. Thus, more recently, the key role of another Christian Zionist president in enabling the provocation of 911 to lead the U.S. to war in Iraq—in pursuit of Zionism’s Greater Israel policy.
But for their personal sympathies and that perceived identity of interest, would these two assets have embraced policies helpful to Jewish extremists and harmful to the national interest? Therein lies the danger when the U.S. was induced to embrace—with its post-WWII sympathy—an entangled alliance with what Barack Obama in mid-June described as a “Jewish state.”
How did an Illinois state senator with two years experience in the U.S. Senate become president at this key juncture? Two of his top-three campaign funders from Westside Chicago—Pritzker and Crown (né Krinsky)—trace their family histories to Jewish syndicates of the 1920s. The third, Hungarian-Ashkenazi George Soros, made his billions from hedge funds.
What role does identity politics play in the decision-making of the nation’s first African-American president? Did his minority status provide Tel Aviv a sympathetic ear that induced his refusal to take a firm stance on settlements in the West Bank? Did his empathy for protests in Tehran change his mind about talks with Iran, a diplomatic initiative opposed by Israel?
Was Barack Obama profiled, picked and produced to assume this position? Are his personality—and his personal history—being exploited to advance an agenda of which he is not consciously aware? As organized crime in the U.S. grew in scope and scale, its operations became more sophisticated. As this Jewish syndicate gained more power, its influence became subtler.
Those closest to this latest president are using identity politics to shape an agenda consistent not with U.S. interests but with the goals of the theocratic state that Truman feared Israel would become. One of Barack Obama’s top two aides (both are Jewish) served with the Israeli Defense Forces during the Gulf War.
The sensitivities—and sympathies—surrounding identity politics have thus far kept such analyses beyond the scope of inquiry. Yet national security requires that the use of such sophisticated psy-ops now be assessed based on the consistency of this strategy from Truman to today.
Judiciary Committee member Charles Schumer, third-ranking in the Senate leadership, quizzed Judge Sotomayor to show that bias, sympathy and empathy played no role in her decisions. Yet not once did Schumer, a key advocate of U.S. identity with Israel, mention the role played by pro-Israeli bias and sympathies in reshaping U.S. law and jeopardizing national security
Identity politics help explain how Jewish organized crime can operate in plain sight and, to date, with impunity. As “Chosen,” those complicit view sympathy and empathy as emotions to be manipulated, not reciprocated. Only in this broader strategic context can a jurist’s support for identity politics be properly assessed.
Barack Obama
Did Obama Blink—Again?
June 17, 2009 by Jeff Gates · 1 Comment
Barack Obama’s June 4th speech in Cairo addressed a global population of 1.3 billion Muslims long outraged at the abuse that Israel has inflicted on its neighbors—with U.S. support. The potential positive impact of that speech was offset when he appeared the next day in Germany at the Buchenwald death camp. The timing of that Holocaust photo-op resolved all doubts about who stage-manages his presidency.
Attention then turned back to newly elected Israeli Prime Minister Benjamin Netanyahu. In mid-May, Obama’s handlers allowed this right-winger to proclaim—from the White House—that peace with the Palestinians was a distant second to Israeli concerns about Iran. In a mid-June speech, an emboldened Netanyahu grudgingly mentioned a “two state solution.” Obama quickly portrayed his use of that phrase as an “important step forward.”
In truth, that speech announced several giant steps backward. Rather than agree to negotiate a two state solution, he insisted on preconditions certain to preclude two states, leaving nothing to negotiate. Obama again countered the positive impact from Cairo when he praised a speech that directed Palestinians to recognize Israel as a “Jewish state” where Jerusalem as “Israel’s capital will remain united.”
Those remarks also proclaimed Israel’s right to continue its colonization of Palestinian land by expanding the very settlements that preclude a viable Palestinian state. By applauding Netanyahu’s defiant speech, a U.S. president helped inflame the very conditions that have precluded peace in the Middle East for more than four decades.
Anticipating pressure to change, Tel Aviv opened a three-front assault. Foreign Minister Avignor Lieberman (from Moldova) began talks in Moscow (in fluent Russian) to show that Israel could—and readily would—turn elsewhere for a “special relationship.” Second, the Israel lobby opened a domestic assault on Obama by announcing, “Jewish leaders are deeply troubled by his recent Middle East initiatives.” The lobby also reminded this political product of Chicago-Ashkenazi money where his presidential bread is buttered.
Third, as soon as Middle East envoy George Mitchell opened talks with Syria, the first since the U.S. withdrew its ambassador in 2005, Netanyahu gave a speech with no mention of the Golan Heights and with terms certain to ensure that peace would remain beyond reach.
With no need to cite the Holocaust photo-op, the official Syrian newspaper noted simply, “This is the principle that always guides Israel when approaching the Zionist-Arab conflict. The Israelis see themselves as victims rather than the aggressor.”
By again failing to stand up to Tel Aviv and its U.S. lobby, Obama enabled the very conduct that most endangers national security. While his words in Cairo promised a “new beginning,” his actions signaled business-as-usual. If this Chicago politician continues to appease Israeli extremists, his behavior may well induce another terrorist attack.
Should that happen, recent history suggests that an orgy of evidence will plausibly point to “Islamo” fascists while Israel again portrays itself as the perennial victim in need of protection in a hostile neighborhood. Absent Obama’s proven resolve to expunge “special” from this relationship, this entangled alliance will continue to make the U.S. look guilty by its association with Israel’s extremist behavior. There lies the greatest peril to national security.
With his unrepentant remarks, Netanyahu turned a two state solution back into a bargaining chip. By his insistence on terms that preclude a final settlement, he reconfirmed Tel Aviv’s commitment to sustain this conflict. Obama’s propensity to blink at time-critical moments suggests he will continue to encourage a course that invites more terrorism—either by Israelis or those provoked by their behavior.
Any objective ranking of this presidency would reveal its disproportionate pro-Israeli staffing. Democrat Harry Truman, a Christian-Zionist, offered nation-state legitimacy to this Zionist enclave. Republican G.W. Bush, also a Christian-Zionist, staffed his presidency the same as Democrat Obama.
This transpartisan insider operation shares an allegiance neither to party nor president but to a common covenant whose faith-based obligations take precedence over U.S. interests. The depth and duration of this disabling bias suggests that the only way to restore national security is to withhold funding for Israel, withdraw our diplomats and reshape our foreign policy around U.S. interests.
Should this president, like his predecessors, continue to perform inconsistent with the national interest, an informed citizenry must remind him why the Framers set a low evidentiary standard for proving treason, requiring only that the accused “adhere” (or grant “aid and comfort”) to an enemy—whether domestic or foreign.
Should Dennis Ross, a reliably pro-Israeli diplomat, be removed as U.S. envoy to Iran, that would be the first sign that Barack Obama may yet perform consistent with his constitutional oath to defend this nation. By his repeated refusals to stand up to the Israel lobby—and by reliably blinking under pressure from a tiny minority, this president risks not only U.S. national security but also a personal charge of treason.
Barack Obama
The Obama Presidency’s War in Iran
May 21, 2009 by Jeff Gates · 1 Comment
President Obama’s decision to release top-secret torture memos was reached in the office of Rahm Emanuel over protests from the Director of Central Intelligence. Former Vice President Dick Cheney defended the practice, claiming America is safer for it. Speaker of the House Nancy Pelosi then sought to defend her criticism despite early knowledge of it.
Caught lying, Pelosi attacked the CIA. Director Leon Panetta defended Agency briefers and their detailed records of what Pelosi was told. Needing the Speaker’s help to spearhead his ambitious legislative agenda, Obama’s team brokered a peace between Democrats Pelosi and Panetta.
Why did both Republican Cheney and Democrat Pelosi support the use of “enhanced interrogation techniques” on one particular “high value” detainee? Answer: the case for war required a plausible “high-level link” between the secular Saddam—who hated religious fundamentalists—and the religious fundamentalists of Al Qaeda—who hated him. After 83 waterboardings, the link emerged in a confession.
Akin to the Inquisition, this detainee was “put to the question.” When proposing to wage a global crusade on false pretenses (The Clash of Civilizations), war-planners required One True Faith in that linkage. As in the Dark Ages, the confession was later recanted and the case collapsed—but only after the war in Iraq was well underway.
Even now that link remains an article of faith—alongside weapons of mass destruction, meetings in Prague and mobile biological weapons laboratories. All were bogus. But without this key link, the case would have been exposed as phony, even treasonous. However, the worst was yet to come—a November 18 White House meeting with Israeli Prime Minister Benjamin Netanyahu.
In a two-hour Oval Office encounter with this hawkish right-winger, an untested U.S. commander in chief met his Monica Lewinsky. Distracted by a promiscuous White House intern, Bill Clinton found himself embroiled in impeachment proceedings when he should have been keeping a closer eye on Al Qaeda. The allure of Netanyahu differs in kind but not in its impact on national security—and potentially on the Obama presidency.
The day before their meeting, Netanyahu met with an ebullient American-Israeli Public Affairs Committee. Obama’s Justice Department had not only withdrawn its espionage case against two AIPAC spies, the lobby had also silenced Obama while they savaged Charles Freeman, forcing him to withdraw his acceptance as chairman of the National Intelligence Council. A known skeptic of Israeli designs on the region, Freeman would have overseen the National Intelligence Estimate, coordinating the views of all 16 intelligence agencies.
By the time Netanyahu appeared alongside Obama, a U.S. president looked like he was a visitor in the office of the Israeli Prime Minister. Rather than issue photographs of their meeting as he did days earlier with Israeli president Shimon Peres, Obama granted Netanyahu a widely reported press conference in which he failed to press Israel’s new prime minister to end the four-decade occupation of Palestine as the top priority for achieving peace in the region.
Instead, he allowed the Israeli leader to use the White House as a pulpit to announce that peace with the Palestinians was a distant second to the risks posed by Iran. Romanced by Netanyahu and the pro-Israelis who populate his presidency, Obama once again fulfilled AIPAC’s wish list. By allowing pro-Israelis to control the White House agenda and Israelis to control the message, Obama signaled a go-ahead to those long determined to expand to Iran the war in Iraq.
While Netanyahu met with Obama, Israelis were pouring the foundations for settlement expansion, that conduct sent a clear signal to those waiting to see who controls foreign policy in the Obama administration. Only the next day did Secretary of State Clinton call for a halt to the settlements.
When Israeli jets bombed Gaza the next day, that conduct reconfirmed who controls U.S. policy. Only after their meeting did CIA Director Panetta urge that Israel not attack Iran. By then it was too late. America’s commander-in-chief had tipped his hand: what AIPAC wants, Israel gets.
Within 24 hours of their meeting, a letter was delivered to Obama by 76 Senators warning, “We must take into account the risks (Israel) will face in any peace agreement.” Within 48 hours, a 90-6 Senate vote denied Obama the funds required to close detention facilities at Guantanamo Bay. In a resounding rebuke, both Democrats and Republicans decried his inexperience in national security—making the militaristic Netanyahu look “presidential” by comparison.
The vote tally was known well beforehand by White House chief of staff Rahm Emanuel and David Axelrod, Obama’s top political strategist. Both played key roles in producing this presidency. Both Obama and national security were victims of this sophisticated operation.
In stage-managing this series of back-to-back political debacles, Obama’s pro-Israeli advisers worked hand-in-glove with the Israel lobby to ensure he was left with few options but to support Israel’s designs on the region. Forced to prove his mettle, the commander-in-chief will find he has no hope of managing his way through the crises now awaiting him—except to back Israel’s expansionist agenda for the Middle East, ensuring more hatred for the U.S. while fueling The Clash. In the pursuit of Israel’s agenda, the Obama presidency is proving itself the missing link.
Barack Obama
Is Benjamin Netanyahu Waging War By Way of Deception?
May 17, 2009 by Jeff Gates · 2 Comments
May 18, 2009 marks the first meeting between Israel’s new prime minister and America’s new president. Israeli behavior suggests that the pre-staging for a terrorist attack may be underway to advance indirectly what Tel Aviv cannot achieve directly.
In the diplomatic shadow boxing that precedes such meetings, Benjamin Netanyahu took a page from the playbook of former Prime Minister Ariel Sharon. In 2002, the hawkish Sharon assured the U.S. that peace was achievable if only the U.S. would remove Saddam Hussein. The hawkish Netanyahu now assures the U.S. that the barrier to peace is Iran.
In practical effect, the U.S.-led invasion of Iraq handed that dominantly Shiite nation to Shiite Iran on a silver platter. Deputy Defense Secretary Paul Wolfowitz assured Americans they would be welcomed with flowers and sweets. Yet anyone familiar with the region knew that a violent overthrow of the Iraqi dictator—particularly if led by a nation allied with Israel—would create political dynamics certain to favor the Shiites and Iran.
If Barack Obama fails to comply, Israel has signaled its intention to continue this six-decade conflict. That would only further undermine U.S. national security as America would continue to be portrayed as guilty by its association with Israel’s thuggish behavior.
Citing the Jewish state’s “very close friendship” with the U.S., Defense Chief Ehud Barak declared Israel “ready for a process.” He proposes three years to hammer out an agreement between “two peoples” (versus two states) and another five years for implementation. That “process” puts peace safely beyond the reach of even a two-term U.S. president.
Though Netanyahu will press Obama to pressure Tehran, the “existential” threat he cites to justify an Israeli attack on Iran can be addressed by the Israelis themselves. Palestinian statehood has long been key to keeping Iran’s nuclear program peaceful.
Better yet would be a nuclear-free Middle East. President John F. Kennedy pressured Israel not to start a nuclear arms race in the region. In a June 1963 letter to David Ben Gurion, he insisted on knowing “beyond a reasonable doubt” that Tel Aviv was not building a nuclear arsenal. Before the letter could be delivered, Ben Gurion resigned. With Kennedy’s assassination, the Zionist state found in Lyndon Johnson a far more compliant president.
Secretary of State Hillary Clinton suggested that the U.S. may provide Israel with support “vis a vis Iran.” If President Obama in any way links the two-state solution to concessions on Iran, he is inviting a terrorist attack. If history is any guide, that attack will be accompanied by an orgy of evidence implicating Hezbollah, with Iran the plausible Evil Doer.
Nation state terrorism is a real threat. The problem lies in the misplaced focus. The U.S. was taken to war in Iraq by those skilled at displacing facts with what “the mark” could be deceived to believe: Iraqi WMD, substantive ties to Al Qaeda, mobile biological weapons, meetings in Prague and so forth. All were false. Yet all were widely believed.
No one has yet identified the stable nation state intelligence required to perpetrate 911 or to continue to run such a fact-displacing psy-ops program in plain sight almost eight years later. Who has the means, motivation and opportunity to operate inside the U.S. with such impunity? “Islamo” fascists?
More than 92 months have passed since the terrorist attack of 911 was cited by U.S. war-planners as a rationale to invade Iraq. The beneficiary of that attack was not the Arab world but Israel. Yet the chairman and vice-chairman of the 911 Commission reported overwhelming opposition to hearings on the motivation for that mass murder.
The barrier to peace in the Middle East is not Iran. The barrier is the false belief that Israel is (a) a democracy and (b) an ally of the U.S. The obstacle to peace is six decades of ongoing warfare waged by way of deception. The problem is a nuclear-armed theocratic people committed to an expansionist foreign policy and an apartheid domestic policy.
The threat is not to the Jewish state. The existential threat is the danger to world peace posed by the U.S.-Israeli relationship. And by those pro-Israelis who produced Barack Obama’s political career and now shape his policies.
If this U.S. president fails to insist on a peace that only the U.S. can force, he will be allowing foreign interests to shape U.S. foreign policy. By that decision, he will be inviting a terrorist attack. And for that decision he will be seen as advancing the interests of an enemy within—a treasonable charge.
Barack Obama
Does Barack Obama Offer Hope for New Mideast Dynamic?
November 29, 2008 by Jeff Gates · Leave a Comment
Does Barack Obama Offer Hope for New Mideast Dynamic?
By Jeff Gates
Those familiar with the pro-Zionist politics of John McCain breathed a sigh of relief at his defeat. With Barack Obama there’s a possibility of change where change is most needed: in U.S.-Israeli relations. The prospects, however, are not bright for several reasons.
First, he faces major hurdles in Congress where pro-Israelis chair key committees and subcommittees. Obama hails from Chicago, a major node in the node-and network system of organized crime. His senior in the Illinois delegation is Richard Durbin, a lawyer recruited by the Israeli lobby in 1982 to oppose 11-term Rep. Paul Findley who challenged the Israelification of U.S. foreign policy. First elected to the Senate in 1996, Durbin serves as assistant majority leader.
Durbin shares a house in Washington with Charles Schumer, a pro-Israeli senator from New York and third ranking in the Senate leadership. Both men are junior to Senate Majority Leader Harry Reid of mobbed-up Nevada.
Reid is a Zionist-inclined Mormon (aka the Lost Tribe of Israel). His assessment of the Israel lobby: “I can’t think of a policy organization in the country as well organized and respected.”
Obama proved on the campaign trail how readily he could yield to pressure from pro-Israelis. Malcolm Hoenlein, head of the Conference of Presidents of Major American Jewish Organizations, cited Obama’s promise of change as “an opening for all kind of mischief.”
To please and appease, Obama delivered a series of pro-Israel speeches. Though it was U.S. national security that was put at risk in pursuit of Israel’s agenda in the Middle East, Obama spent much of his spring campaign pledging his allegiance to Israel and portraying its security as “sacrosanct.”
Obama takes office in the midst of a perfect storm raging in a nation targeted by those skilled at waging war “by way of deception,” the Israeli Mossad’s operating motto. Those complicit are skilled at displacing facts with what people can be deceived to believe—whether a false belief in Iraqi WMD and mobile biological weapons laboratories, or a misplaced faith in the infallible wisdom of unfettered financial markets.
Though Americans know they were deceived, they do not yet know how, by whom or to what purpose. Those anticipating change need only watch who staffs an Obama administration.
When he convened his foreign advisory team, he placed pro-Israeli Madeleine Albright at the head of the table. She was secretary of state for President Bill Clinton.
When he convened his economic policy team, Lawrence Summers took
the lead. Recently forced out as president of Harvard University, former Treasury Secretary Summers handpicked the pro-Israeli advisory team that oversaw the oligarchization of Russia. The largest fraud in history, Mikhail Gorbachev estimated that the financial pillage exceeded $1 trillion. Eight of the top nine oligarchs qualify for Israeli citizenship.
Obama will be sworn in on the 100th anniversary of the founding of the National Association for the Advancement of Colored People. The NAACP was established six months after the Springfield race riot of 1908 that resulted in seven deaths in Abraham Lincoln’s hometown. From its outset, the NAACP leadership was dominated not by African-Americans but by Jewish-Americans. Not until 1975 did it have a black president.
By allying with those genuinely oppressed, the Jewish-American community enjoyed extraordinary economic and social progress, particularly when compared to blacks. Advancement in the financial arena was especially pronounced where 25 percent of the Forbes 400 richest Americans are now Jewish, compared to 1.7% of the U.S. population. Blacks, on the other hand, continue their disproportionate representation in the lower tiers of both wealth and income.
The subprime mortgage meltdown is the third financial “pump and dump” over just the past two decades. The savings and loan fraud of the late 1980s cost taxpayers $124 billion. The far more expensive “dotcom” bust of 2000 will be dwarfed by this latest financial fraud. Those who skimmed the financial cream as markets rose have routinely been well placed to buy assets at reduced prices as markets fell.
With foreign policy and economic policy the key challenges, watch who Obama picks for those areas. In this handoff from one party to another, the same pro-Israeli bias appears likely to remain intact. Unable to manipulate him with sex (as with Clinton) or beliefs (as with Bush), race may well come into play.
As the U.S. enters the most challenging period in its 232-year history, this president could determine whether freedom survives or oppression triumphs. If President Obama grasps the all-pervasive influence of the U.S.-Israeli relationship, he could become a transformational leader—by transforming that relationship. Should he continue on the course set by previous leaders of both parties, it would be wrong to charge “the fix is in” when the facts confirm that the fix never left.
Barack Obama
All Too Familiar
November 29, 2008 by Jeff Gates · 1 Comment
Is a multi-trillion dollar fraud being perpetrated on America by Lawrence Summers and the same transnational network that defrauded Russia of $1 trillion?
< ——- >
The appointment of Lawrence Summers as Barack Obama’s top economic adviser may herald a U.S. version of the loans-for-shares fraud that financially pillaged Russia, leaving in its wake a politically powerful oligarchy.
Shielded by the credibility of a Harvard advisory team handpicked by Summers, Moscow saw a mid-1990s credit crisis used to shift the ownership of state-owned assets to a handful of Russians. At the time, Summers was serving as Under Secretary for International Affairs, the U.S. Treasury’s senior financial diplomat.
When the government of Boris Yeltsin ran low on cash, advisers urged that funds be borrowed from oligarch-controlled banks. As collateral, Moscow pledged shares in state-owned oil companies, the crown jewels of the Russian economy.
When the loans defaulted, the shares were sold to those same oligarchs in rigged auctions. Portrayed as “privatization” by Summers and Harvard’s accommodating advisers, Russians called it simply “mafia-ization.” Mikhail Gorbachev estimates that the oligarchs stripped $1 trillion from Russia’s struggling economy. With an Ashkenazi population of less than two percent, eight of Russia’s nine richest oligarchs qualified for Israeli citizenship.
Summers succeeded Robert Rubin as Treasury Secretary in 1999, marking their success in repealing Depression-era laws that banned the merger of banks, brokers, insurance firms and investment banks. A former co-chairman of Goldman Sachs, Rubin joined CEO Sanford Weill at Citigroup, the first financial institution to fully embrace the Rubin-led repeal.
At Rubin’s urging, Citi thrived by bundling loans as securities (mortgages, credit card loans, auto loans, student loans, etc.) and selling them as collateralized debt obligations (”CDOs”). Meanwhile Summers championed the deregulation of financial derivatives, ensuring the globalization of losses from those securities. With “assets” of $2 trillion (largely troubled loans) and operations in 100 countries, Citi is now “too big to fail.”
Rubin protégés advised Obama that taxpayers should assume responsibility for $306 billion of Citi’s junk loans–$1,000 per American. Treasury’s bailout funds will cover $5 billion and $10 billion will be paid by the Federal Deposit Insurance Corporation (funded by banks). Additional losses will be paid by the Federal Reserve printing money as needed–with all that implies for inflation and stagnation. Summers is the leading candidate to succeed Fed chairman Ben Bernanke in 2010.
Obama picked Tim Geithner as Treasury Secretary. A protégé of Henry Kissinger and then of Rubin and Summers, Geithner and Summers often vacation together. Known to wilt in the presence of Summers’ notorious arrogance, Geithner will oversee bank shares given the government in return for the bailout.
In this funds-for-shares program, what happens if, as in Russia, the funds prove insufficient? If America’s debt-laden economy continues its decline, does government become the owner? If not, to whom will those shares be sold?
Look to private equity firms adept at acquiring companies with little cash and lots of debt. Is that the political role being played by former Republican National Committee chairman Ken Mehlman? Mehlman serves as chairman of public affairs for Kohlberg Kravis Roberts & Co., the nation’s leading leveraged buyout firm.
Americans have long shared a healthy aversion to concentrations of financial power. Was Mehlman hired to facilitate the bank consolidation we now see emerging? The Comptroller of the Currency announced in August that private equity firms could become banks–and acquire other banks. The bank bailout covers leveraged corporate loans, clearing their books to fund more leveraged buyouts.
If, as appears likely, today’s vast pyramids of debt continue to collapse, into whose hands will control of the financial sector shift? With banking already consolidated in four major institutions–each too big to fail–the American counterpart to the Russian oligarchs could be the senior partners in private equity firms: Kohlberg, Kravis and Roberts plus Stephen Schwarzman at Blackstone Group, David Bonderman at Texas Pacific Group, David Rubenstein at Carlyle Group and Leon Black at Apollo Group.
In Russia, state-owned assets shifted into a few private hands–in response to a credit crisis–when advisers urged that Moscow assume debts it could not repay. Those assets were then sold for cents on the dollar. In America, banks may well migrate into the hands of a few private equity firms, leaving in their wake a trail of socialized debts as junk loans are upgraded to gilt-edged bonds backed by the full faith and credit of the U.S.–undermining the nation’s credit standing worldwide.
As in Russia, both the advisers and the new owners qualify for Israeli citizenship. Summers had a hand in both bailouts. As President-elect Obama scrambles to stabilize the financial system, will his pledge of clarity and transparency include an account of how–and by whom–he was advised to capitalize a transnational Ashkenazi oligarchy?
