3 Fraud Probes Target Goldman, AIG: Is It ‘The’ Story of 2010?, Daily Kos, December 28, 2009 by Bob Swern, quoted verbatim:

It does not take much reading between the lines of recent news stories–although, technically, this is still just speculation–to come to a yet-to-be-confirmed conclusion that many executives from numerous Wall Street firms, including Goldman Sachs’ past and present CEOs Hank Paulson and Lloyd Blankfein,  respectively,  may be in the cross-hairs of  multiple fraud investigations by the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA),  and Congress. (See Gretchen Morgenson’s NY Times links, further down the page.)  Let me lay it all out for you…day-by-day over the past week…

Five days ago, I posted the following:

The AIG-Wall St. Bailout Corruption Story That Won’t Go Away.

Do economist, University of Missouri-Kansas City professor and white collar crime investigator William Black, former NY Governor and Attorney General Eliot Spitzer and University of San Diego professor of law Frank Portnoy have their eyes on the prize: federal indictments of former Treasury Secretary Henry Paulson and Goldman CEO Lloyd Blankfein? Or, saying it more accurately, finding the smoking gun that’s the difference between indicting or not indicting former Treasury Secretary Henry Paulson and his successor at Goldman Sachs, current CEO Lloyd Blankfein. What am I referencing you ask? That’d be the “potential” bailout fraud, corruption and malfeasance story about AIG (diarist’s note: and Goldman Sachs) that just won’t go away. More specifically, you may read all about it in a piece posted at Naked Capitalism, today; but, let’s start with an Op Ed piece Spitzer, Black and Partnoy published this past Sunday in the NY Times: “Show Us the E-Mail.”

From the NY Times (December 20, 2009 Op-Ed page):

Show Us the E-Mail

By ELIOT SPITZER, FRANK PARTNOY and WILLIAM BLACK
Published In Print: December 20, 2009…A.I.G. was at the center of the web of bad business judgments, opaque financial derivatives, failed economics and questionable political relationships that set off the economic cataclysm of the past two years. When A.I.G.’s financial products division collapsed — ultimately requiring a federal bailout of $180 billion — those who had been prospering from A.I.G.’s schemes scurried for taxpayer cover. Yet, more than a year after the rescue began, crucial questions remain unanswered. Who knew what, and when? Who benefited, and by exactly how much? Would A.I.G.’s counterparties have failed without taxpayer support?

–SNIP–

…we know where the answers are. They are in the trove of e-mail messages still backed up on A.I.G. servers, as well as in the key internal accounting documents and financial models generated by A.I.G. during the past decade…

–SNIP–

…Once the documents are available for everyone to inspect, a thousand journalistic flowers can bloom, as reporters, victims and angry citizens have a chance to piece together the story.

–SNIP–

Perhaps A.I.G.’s employees would also be judged not guilty. But we would like to see the record to find out. As fraud investigators, we would like to examine the trading patterns of A.I.G.’s financial products division, and its communications with Goldman Sachs and other bank counterparties who benefited from the bailout.

–SNIP–

Congress wants answers, too. This month, during hearings on Ben Bernanke’s nomination to a second term as chairman of the Federal Reserve, several senators fumed about being denied access to his A.I.G.-related documents…

More from my diary from five days ago…

Yves Smith, publisher of Naked Capitalism, was all over this story (before it even hit the newsstands) last Saturday evening, in: “Spitzer, Partnoy, Black Call for AIG Open Source Investigation (and Goldman Implications).”Putting it simply, the question is: How could our government let the monoline insurance companies–the insurers of most “agency” paper and state and municipal bonds in this country–collapse while choosing to make an exception to this practice as they singled-out AIG for the largest corporate bailout, by far, in our country’s history?

Spitzer, Partnoy, Black Call for AIG Open Source Investigation (and Goldman Implications)

December 20, 2009
Yves Smith
Naked Capitalism…While the subprime deals and CDOs were obviously going bad, an argument was made by many people at the time that the aggressive mark downs by AIG acelerated the death spiral for the market. It is pretty clear, here and elsewhere, that Goldman was the one that initiated the mark downs of collateral value. It would be interesting to explore this all the way through. Though not discussed in this article, Goldman shorted subprime through the Abacus deals, and perhaps elsewhere. This gave them an incentive to force mark downs. the intermediation deals described in the article, combined with AIG’s collateral posting, gave them another incentive to be agressive with mark downs. They were acting like they wanted to grab the money before anyone else could get their hands on it. This would have raised some issues in an AIGFP bankruptcy. (note – Hank Greenberg suggested that this was going on in his october 2008 testimony but there was a chorus of attacks on him for being a crook and unreliable, thanks to his problems with Spitzer.)

So here we have the pattern:

1. Goldman creates or sells $23 billion (or more) of CDOs and stuffs them into AIG.

2. Goldman proclaims to the world they have no exposure to CDOs and warns that banks and insurers with CDO exposure will get downgraded.

3. Goldman initiates the mark downs of CDOs with AIG and others, acelerating the market’s downward spiral.

4. Huge mark to market losses lead insurer and bank credit to freeze, short term markets to lock up, ABCP to collapse.

5. AIG posts as much collateral as it has to Goldman, who has more aggressively marked down the exposure.

6. Bond insurers are downgraded, banks begin commutations with them.

7. AIG fails, Fed steps in, Goldman gets bailed out at par.

Yves here. This looks like no accident. I suspect it was no accident…

Well, Yves made one statement in her diary that we’ve since learned was incorrect: “And no one in authority wants to find out…”

You see, a lot of people have been reading follow-up coverage on this story from the likes of Thomas Adams, whom I quoted in my previous diary on this matter, and further down the page from something he just posted a few hours ago over at Naked Capitalism. And, many people read Janet Tavakoli’s piece on HuffPo on December 22nd: “Janet Tavakoli: Treasury Cover-Up Of Goldman’s Role In AIG Crisis.”

Treasury Cover-Up of Goldman’s Role in AIG Crisis?

Huffington Post
Janet Tavakoli
President, Tavakoli Structured Finance, Inc.
Posted: December 22, 2009 07:20 AMIn November 2009, I wrote in the Huffington Post that Goldman Sachs Group nearly bankrupted AIG. In December, the Wall Street Journal explained to the general public that Goldman fueled AIG’s gambling and played a much bigger role in the mortgage bets that nearly felled American Insurance Group (AIG) than the Treasury, the Fed, or Goldman itself publicly disclosed.

The TARP Inspector General’s November 17 report missed the most damaging facts. Intentionally or otherwise, it was evasive action or just plain whitewash. The report failed to clarify Goldman’s role in AIG’s near collapse, and that of all the settlement deals, the U.S. taxpayers’ was by far the worst.

Goldman originated or bought protection from AIG on about $33 billion of the problematic $80 billion of U.S. mortgage assets that AIG “insured” with credit derivatives, about twice as much as the next two largest banks involved.

Goldman acted as middle-man on $14 billion of that amount, after it took the risk of mortgage assets originated by other banks and insured all of it with AIG. Goldman may wish to claim it “was only following orders,” but since Goldman also originated many of the mortgage assets ultimately protected by AIG, it should have been well aware of the risk posed to itself and to AIG. The risk was then Goldman’s. If AIG failed, Goldman Sachs would have had to make good on those trades…

Apparently, Pulitzer Prize-winning business journalist Gretchen Morgenson read Tavakoli’s piece, too. And, here’s an example as to why Ms. Morgenson’s been referred to by many as the best in the business here in the U.S.:  

Banks Bundled Bad Debt, Bet Against It and Won.

The day after my diary appeared, in Morgenson’s Christmas Eve Day piece, from this past Thursday, we learned that at least three major government and Wall Street entities (the SEC, FINRA and Congress, see detail in the opening paragraphs of this diary) are actively investigating these, and related issues.

(Diarist’s Note: If you read only ONE linked story in this diary, it should be this one!)

Morgenson tells us of  how Goldman trader Jonathan Egol rose to prominence in the firm by “…creating mortgage-related securities, named Abacus, that were at first intended to protect Goldman from investment losses if the housing market collapsed. As the market soured, Goldman created even more of these securities, enabling it to pocket huge profits.”

As Morgenson explains it to us, within just a few months of their sale, these CDOs began imploding…

Banks Bundled Bad Debt, Bet Against It and Won
By GRETCHEN MORGENSON and LOUISE STORY
New York Times
Published In Print: December 24, 2009…Pension funds and insurance companies lost billions of dollars on securities that they believed were solid investments, according to former Goldman employees with direct knowledge of the deals who asked not to be identified because they have confidentiality agreements with the firm.

Goldman was not the only firm that peddled these complex securities — known as synthetic collateralized debt obligations, or C.D.O.’s — and then made financial bets against them, called selling short in Wall Street parlance. Others that created similar securities and then bet they would fail, according to Wall Street traders, include Deutsche Bank and Morgan Stanley, as well as smaller firms like Tricadia Inc., an investment company whose parent firm was overseen by Lewis A. Sachs, who this year became a special counselor to Treasury Secretary Timothy F. Geithner.

How these disastrously performing securities were devised is now the subject of scrutiny by investigators in Congress, at the Securities and Exchange Commission and at the Financial Industry Regulatory Authority, Wall Street’s self-regulatory organization, according to people briefed on the investigations. Those involved with the inquiries declined to comment.

While the investigations are in the early phases, authorities appear to be looking at whether securities laws or rules of fair dealing were violated by firms that created and sold these mortgage-linked debt instruments and then bet against the clients who purchased them, people briefed on the matter say.

One focus of the inquiry is whether the firms creating the securities purposely helped to select especially risky mortgage-linked assets that would be most likely to crater, setting their clients up to lose billions of dollars if the housing market imploded…

Morgenson continues on to reiterate how many of these investments soured, almost immediately, while explaining that Goldman and other firms placed “unusually large negative bets that were not mainly for hedging purposes, and investors and industry experts say that put the firms at odds with their own clients’ interests.”

“The simultaneous selling of securities to customers and shorting them because they believed they were going to default is the most cynical use of credit information that I have ever seen,” said Sylvain R. Raynes, an expert in structured finance at R & R Consulting in New York. “When you buy protection against an event that you have a hand in causing, you are buying fire insurance on someone else’s house and then committing arson.”

You really should read Morgenson’s entire piece.  It’s comprehensive and quite compelling, to say the least.

Meanwhile, Janet Tavakoli received a communication from Goldman concerning her piece (noted above), from earlier last week. Here’s the link to her response: “Responding to Goldman Sachs.”

Responding to Goldman Sachs

Janet Tavakoli
President, Tavakoli Structured Finance, Inc.
Posted: December 25, 2009 10:19 AMThe New York Times published a Christmas Eve expose of Goldman Sachs’s so-called “Abacus” synthetic collateralized debt obligations (CDOs). They were created with credit derivatives instead of cash securities. Goldman used credit derivatives to create short bets that gain in value when CDOs lose value. Goldman did this for both protection and profit and marketed the idea to hedge funds.

Goldman responded to the New York Times saying many of these deals were the result of demand from investing clients seeking long exposure. In an earlier Huffington Post article, I wrote about Goldman’s key role in the AIG crisis; it traded or originated $33 billion of AIG’s $80 billion CDOs. AIG was long the majority of six of Goldman’s Abacus deals. These value-destroying CDOs were stuffed with BBB-rated (the lowest “investment grade” rating) portions of other deals. These BBB-rated portions were overrated from the start. Many of them eventually exploded like firecrackers.

–SNIP–

The answer is that they sold a lot of “hot air” disguised as valuable securities. Goldman claims this was prudent risk management. In reality, Goldman created products that it knew or should have known were overrated and overpriced.

–SNIP–

Earlier, Goldman denied it could have known this was a problem, yet acknowledged I had warned about the grave risks at the time. If Goldman wants to stick to its story that it didn’t know the gun was loaded, then it is not in the public interest to rely on Goldman’s opinion about the greater risk it now poses to the global markets.

Goldman excuses its participation by saying its counterparties were sophisticated and had the resources to do their own research. This is a fair point if Goldman were defending itself in a lawsuit with a sophisticated investor trying to recover damages. It is not a valid point when discussing public funds that were used to bail out AIG, Goldman, and Goldman’s “customers.”

From Thomas Adams, very early this morning, over at Naked Capitalism: “Is Blaming AAA Investors Wall-Street Serving PR?”

Is Blaming AAA Investors Wall-Street Serving PR?

Monday, December 28, 2009
Naked Capitalism
By Thomas Adams, at Paykin Krieg and Adams, LLP, and a former managing director at Ambac and FGIC.In my view, Goldman, and a host of other clever bankers, are deliberately obscuring one of the most important points…(by telling us that) everyone is a grown up and should have known what he was buying.

But that conveniently obscures a critically important fact: for so-called ABS CDOs (the kind made from asset backed securities, meaning tranches of either residential or commercial mortgage bonds), 75% to 90% of the deal was rated AAA. And these ratings did not depend on the insurance provided by AIG or monolines; those ratings were issued on the CDO as concocted by the packager/underwriter.

–SNIP–

Goldman Sachs and dozens of other banks and captured journalists want the story to be about the failure of the investors who were sophisticated and assumed the risk. They ignore the crucial fact that the bonds that blew up were AAA and were sold as virtually risk free…

–SNIP–

The reason that is most frequently cited as why AAA CDO bonds collapsed in value is that they had extreme cliff risk, or tail risk. However, the notion of “cliff risk” should be incompatible with a AAA bond – by definition. Any model that obscures or ignores or adjusts this issue away, is a form of sophisticated lying, as it relates to AAA bonds.

–SNIP–

From the very start, the market for AAA CDO bonds backed by ABS collateral was a fraud…

–SNIP–

…there is ample reason to believe a lot of the CDO packagers and underwriters knew exactly what they were doing…

–SNIP–

…the biggest responsibility lies with the sellers and the creators of the bonds – they were selling something that was supposed to be super safe but turned out to be worthless – and they knew this to be the case, one way or the other.

The title of this diary is: “Is This The Biggest Political Story of 2010?” Just a couple of months ago, perhaps without him realizing the details of it, Nate Silver told us that this may, in fact, be the case: “The Issue That Could Fracture Both Right And Left.”

At the end of the day, the ongoing investigations by the SEC, FINRA and Congress may make it so. After following this story all along, I would have to agree. It is ground zero (at least as far as it relates to everything that is distorted about our knowledge) of the mortgage meltdown, IMHO.

What are your thoughts?

Additional suggested reading: “Paulson’s Calls to Goldman Tested Ethics,” Gretchen Morgenson, New York Times (8/8/09)

Evans Liberal Politics, December 29, 2009, information by Wikipedia and America Speaks, largely quoted verbatim:

America Speaks, according to Wikipedia, is “a Washington, D.C.-based non-partisan, non-profit organization whose mission is to ‘engage citizens in the public decisions that impact their lives.’ America Speaks’ work is focused on trying to create opportunities for citizens to impact decisions and to encourage public officials to make informed, lasting decisions. AmericaSpeaks has developed and facilitated deliberative methods such as the 21st Century Town Hall Meeting, which enables facilitated discussion for 500 to 5,000 participants. Carolyn Lukensmeyer is the President and Founder of AmericaSpeaks. Its partners have included regional planning groups, local, state, and national government bodies, national and international organizations. Issues have ranged from Social Security reform, the redevelopment of ground zero in New York and rebuilding New Orleans.”

Wikipedia has the following information on Founder and President of America Speaks, Carolyn Lukensmeyer: “Dr. Carolyn J. Lukensmeyer, Ph.D., is a leader of deliberative democracy, a public servant and social entrepreneur. In 1995, she founded AmericaSpeaks, a non-partisan non-profit organization that strengthens citizen voice in decision making. Carolyn was Chief of Staff to Governor Celeste of Ohio from 1986 to 1991. She was Consultant to the White House Chief of Staff for nine months during the Clinton years. …(Carolyn) Lukensmeyer was born on May 13, 1945 in Hampton, Iowa. Ms. Lukensmeyer grew up in a four generation family and they instilled in her a strong sense of values, including: a strong ethos of fairness and justice, outrage over injustice, and a belief in standing up for the underdog.”

So you can see that America Speaks, insofar as Carolyn Lukenmeyer is the one running it, is coming from a thoroughly liberal, fairness and social justice oriented viewpoint.

Their Facebook page is here. Sign up for email newsletters from America Speaks here. Donate to America Speaks here. Go to their website and find out more here.

With that introduction, we present the America Speaks 2009 Awards, straight from their website (verbatim):

Dear Friend, Here in Washington we are still digging out from the biggest blizzard since 1996.  In my neighborhood, 24 inches of snow in 24 hours! So beautiful and peaceful. And, of course, everything came to a complete halt.Snowstorms really do create community. It was wonderful to be out with neighbors shoveling, sledding, building snowmen together in the park. So much laughter and good will – everybody in it together facing the challenge. Too bad the United States Congress doesn’t respond to challenges that way.  Hope you enjoy reviewing AmericaSpeaks/Global Voices Top 10 for 2009! Wishing you wonderful Holidays! And may 2010  begin a decade of transformational change whose foundation is inclusion, equity and justice for all. Wishing you and yours wonderful Holidays and may 2010 bring you all you wish for and more! P.S. You may have noticed that in our email to you yesterday there were only 9 out of 10 from our Top 10 List. Unfortunately we experienced a formatting error that resulting in number 1 disappearing from our list. Please accept our apologies for this mistake and for having to send this second email.

And now… Our Top Ten!

1. Innovative Multisite Meetings Advancing the Future of Adults with Autism National Town Hall. AmericaSpeaks coordinated 16 cities across the country in 2009 for a 21st Century Town Meeting®. More than 1,000 people from 33 cities participated in Advancing the Future of Adults with Autism National Town Hall. Three hundred of the participants were at the central site in Chicago, another 700 people participated at 15 additional satellite sites, and more than 50 people participated at virtual tables hailing from 17 additional cities. Some highlights include fastest key pad voting at a Town Meeting (and it was across 16 sites!), best response to our call for facilitators (thanks!), and participant call outs via Skype from 3 cities broadcasted live to all sites. Read the preliminary report here More

2. Largest-Ever Global Town Hall Seal the Deal Global Town Meeting. Global Voices, the international arm of AmericaSpeaks partnered with the United Nations Enviornment Program (UNEP) for Seal the Deal, the largest-ever truly global youth town hall on climate change, in Daejeon, South Korea. 700 young people from around the globe called on world leaders to stand up and take substantial measures against climate change. Participants gathered in Daejeon and were joined by young people in 15 sites around the world, who participated through an interactive online webcast program. Global webcast sites included Cuernavaca Mexico, Bangkok Thailand, London England, Pune India, and Nairobi Kenya. The ‘Seal the Deal’ campaign was spearheaded by UN Secretary-General Ban Ki-moon. He delivered the youths’ joint statement at the opening of the 64th session of the U.N. General Assembly in September and to global leaders this month in Copenhagen, Denmark, for the United Nations Climate Change Conference. Read the Final Report Watch the video UNEP created of the Global Town Hall (Let it download fully before you press the play button.)

3. Web 2.0 and Social Networking A Site for All Seasons. During the course of 2009, AmericaSpeaks worked with our technology partner, Fission Strategy, to develop a core framework for deploying sites on the internet for public engagement projects. The first of these was developed for the Envision Prince George’s project, and can be seen at www.envisionprincegeorges.org.Social Media. This year AmericaSpeaks expanded our capacity for recruiting and message amplification on various social networks this year accruing 478 followers on Twitter and 596 fans on Facebook. If your not a fan yet become one today! Online Organizing around the OGD. When the Obama Administration announced a three-phase online engagement to brainstorm, clarify, and draft language for the Open Government Directive, AmericaSpeaks organized a month-long effort to populate well-crafted ideas and drive support for ideas. Our efforts paid off. By the end of the brainstorming phase 6 of the top 10 ideas in the brainstorming phase were authored by AmericaSpeaks. Global Voices Website. Global Voices, AmericaSpeaks’ international arm, got a new online presence in 2009. Global Voices has led projects for the European Union, World Economic Forum, United Kingdom Ministry of Health and more. Visit the website to find out more about AmericaSpeaks‘ work overseas. A special thank you to all of you who made contributions to enable us to do this breakthrough work even during the recession. We are continuing to fund the work by donations and would be deeply appreciative of your continued support. Donate Here.

4. Federal Work to Strengthen Our Democracy Champions of Participation 2. AmericaSpeaks, Demos, Everyday Democracy and Harvard University’s Kennedy School of Government, joined forces with 34 federal managers representing 23 agencies and departments to provide input on the remarkable opportunity provided by the President’s Memorandum on Transparency and Open Government. Participants identified top opportunities for and barriers to greater participation and collaboration that must be addressed by the Open Government Directive. Read the Report  Senior Champions of Participation Meeting. Continuing our work with Federal Managers. AmericaSpeaks, Demos, Everyday Democracy, and Harvard University’s Kennedy School convened senior leaders from 13 different federal agencies and departments to offer concrete ideas to the Open Government Directive. Beth Noveck, the director of the White House Task Force responsible for creating the directive, participated in the discussions and responded to participant questions and ideas. More  Strengthening our Democracy 2. More than 100 advocates, scholars, federal managers and leaders in the democracy reform field came together this summer to outline an agenda for improving democracy in the United States. This conference, called Strengthening our Nations Democracy II, focused on developing and advancing a unified democracy movement agenda. Participants were scholars and leaders in electoral reform, deliberative democracy, community organizing, collaborative governance, and advocacy. Six members of the Obama Administration participated at critical points during the Conference, including Christina Tchen, director of Office of Public Engagement; Sonal Shah, director of Office of Social Innovation and Civic Participation; Beth Novack, Deputy Chief Technology Officer for Open Government; Julie Fernandes, Deputy Assistant Attorney General; and Buffy Wicks, Deputy Director, White House Office. Read the Report

5. Straus Award Dr. Carolyn J. Lukensmeyer was awarded the Straus Innovator Award from the College of the Atlantic (COA) for her focus and continued dedication to strengthening our democracy. The Straus Innovator Award is a yearly honor given by COA to highlight cutting edge practices that make a positive and tangible contribution to the health of our global civil society. More

6. The Written Word Transforming Governance Through Innovation. AmericaSpeaks’ report on innovative approaches for connecting citizen voices with decision-making approaches that are essential for transforming our nation’s governance. More (908KB) Public Impacts: Report on CaliforniaSpeaks. Report that summarizes three independent evaluations of CaliforniaSpeaks’ 2007statewide conversation. It assesses the Town Meeting’s impact on participants, the policy making process and policy makers themselves. More (pdf 1MB) Volunteer Recruitment Goals, Strategies and Materials. These tips have guided AmericaSpeaks’ work through the years and we hope they will be useful to you as well. Download (362KB) Data is Not Democracy. Dr. Carolyn J. Lukensmeyer’s latest article in the GSA’s Office of Citizen Services and Communications’ newsletter. Carolyn’s article can be found on page 14. Download Open Policy Making 101: 10 Questions To Ask Before Launching Your Online Public Consultation. AmericaSpeaks‘ Vice President of Civic Engagement Joe Goldman, and Joseph Peters from Ascentum wrote a list of ten key questions to consider before launching an online public consultation. More

7. Impact Video In 2009 AmericaSpeaks’ produced a new high impact marketing movie about engaging citizens in decision making. Considering the shouting matches that erupted at many health care town hall meetings this summer, and the necessarily adversarial nature of debates, many decision makers are left wondering: How can I convene a constructive conversation about important policy issues? If you know people in decision making positions, please think about introducing them to AmericaSpeaks and include the link to the impact movie: www.americaspeaks.org/intro. More

8. CommunityForums Rural People Rural Policy CommunityForum Training. AmericaSpeaks launched a new program, CommunityForum, with the Rural People Rural Policy (RPRP) initiative of the W.K. Kellogg Foundation. This new training program teaches rural leaders how to create and manage small versions of our 21st Century Town Meeting®. More Upcoming CommunityForum Trainings. Let us know if you or a team you know of would be interested in attending a CommunityForum Training or if you would just like to stay informed about the time, location and cost of upcoming trainings. Sign Up Here

9. Visioning Processes Envision Prince George’s. AmericaSpeaks partnered with the Maryland National Capital Park and Planning Commission and Prince George’s County Planning Department for an innovative and participatory countywide effort to develop a collective community vision for Maryland’s Prince George’s County. More Power of 32. AmericaSpeaks teamed up with the Power of 32 for a public engagement visioning process in which every resident of 32-counties in 4 states will have an opportunity to participate in creating a shared vision for creating a best future for the entire region. The 32 counties included in this initiative include 15 in southwestern Pennsylvania, 10 in northern West Virginia, five in eastern Ohio, and two in western Maryland. More

10. Welcome to Our Board of Directors Carol Wishcamper has three decades of experience as a leader in the education and non-profit sectors.  Carol is an organizational development specialist.  She is active in civic life in Maine, serving as Chair of the Maine State Board of Education and on the board of the Maine Philanthropy Center.Lee Hamilton is a former Congressman, representing Indiana’s 9th District for 34 years. Mr. Hamilton served as vice-chairman of the 9/11 Commission, and currently serves as President of the Woodrow Wilson International Center for Scholars, and as Director of The Center on Congress at Indiana University. More

As a new year looms ahead, let’s look at a new phenomenon which has begun to hopefully transform the face of American politics and society. What if I were to tell you that there is a rising political force in America, founded by a former leader of the Christian Coalition, Joseph McCormick, once a hated name to liberals and progressives, who now wants to “unite the U.S., one converstion at a time.” Perhaps, you wouldn’t think much of it, since the founder comes from a group fairly hated by liberals.

But what if I were to tell you that in alliance with (or networked with) “The Transpartisan Alliance,” now are groups and individuals such as MoveOn.org, the Green Party of the United States, Common Cause and Al Gore. Think you might have a listen to what they had to say, then?

The Transpartisan Alliance is an informal “network of networks” whose goal is to “motivate and inspire Americans to work together across divides by practicing and teaching the principles of transpartisanship”. These principles, from the Transpartisan Alliance website, are:

Principles and Values:

* Respect other points of view
* Value other points of view
* Open-minded to others
* Listen well to others
* Suspend judgment of others
* Build bridges with others
* Give others benefit of doubt
* Value cooperation

So what, you may ask, is this “transpartisanship”? From the Transpartisan Alliance’s home page:

Transpartisanship acknowledges the validity of truths across a range of political perspectives and seeks to synthesize them into an inclusive, pragmatic whole beyond typical political dualities. In practice, transpartisan solutions emerge out of a new kind of public conversation that moves beyond polarization by applying proven methods of facilitated dialogue, deliberation and conflict resolution. In this way it is possible to achieve the ideal of a democratic republic by integrating the values of a democracy — freedom, equality, and a regard for the common good, with the values of a republic — order, responsibility and security.

A list of the networks who have joined forces with the Transpartisan Alliance can be found here.

Mr. McCormick has a blog post titled Transpartisan Grassroots Up-wising!, from December 8, 2009, which can introduce us to where he is coming from and give us a little entertainment, too, given that it is a talk radio interview coming from both humorous and serious perspectives:

For six years I have been trying to communicate the vision and strategy of Reuniting America at the leadership and at the grassroots levels…

The other day I did a radio interview on KONK in the Florida Keys with political comedian Steve Bhaerman (aka Swami Beyond Ananda). With me coming from from the conservative point of view and Steve coming from a liberal perspective we both are seeing the need for a “transpartisan grassroots up-wising” to re-engage the citizens of America in a search for innovative, win-win policy solutions that 80% plus of us can say “Yes!” to.

Here’s the radio show. I think its both funny and insightful…hope you do too…

If you’re interested, please read Tranpartisan Core Concepts, Transpartisan Alliance, March 16, 2009.

Click the KONK Radio banner to listen to the interview. The interview starts out very irreverently and there is a good deal of humor throughout, but this is serious folks. American truly needs to not formulate its ideas and its political views and policy based on knee-jerk, partisan reactions. Here at Evans Liberal Politics, we’re guilty of doing that all too often. What is needed is a dialogue to pragmatically bring this country together, before hatred and divisiveness tear it apart.

For an oppositional, adamantly liberal and hostile point of view on the Transpartisan Alliance, read Libertarians and the New ‘Transpartisan Concensus?’ Oh, Really?, posted on Evans Liberal Politics on December 23, 2009.

//

The Guardian reports Nine deaths in bloody clashes at Ashura mourning ceremony in Tehran:

It was meant to be an event when Iranians unite to honour one of Shia Islam’s most revered martyrs. Instead, it turned into a day of bloodshed that left at least nine people dead, many more injured and the country facing a potentially unbridgeable political divide amid an escalating cycle of violence.

The Shia mourning ceremony of Ashura became a confrontation between Iran’s torn political factions when the government unleashed a furious crackdown on pro-opposition protesters that included orders to open fire.

Witnesses were still reporting the sounds of gunfire in Tehran last night after a day in which at least five protesters in the city were killed and many more injured in the most violent clashes between opposition supporters and security forces in months. Four more were killed in the northern city of Tabriz, a stronghold of the reformist leader, Mir Hossein Mousavi, whose nephew was among those reportedly shot dead in Tehran.

More than 300 arrests were confirmed, amid reports of violent clashes in cities and towns across Iran.”

Andrew Sullivan and his assistants are covering the issue at the Daily Dish.

Protesters killed in Iran clashes

Iran’s Quest for Freedom

For 17 years our colleagues Jeff Cohen and Norman Solomon have worked with FAIR to present the P.U.-Litzers, a year-end review of some of the stinkiest examples of corporate media malfeasance, spin and just plain outrageousness.

Starting this year, FAIR has the somewhat dubious honor of reviewing the nominees and selecting the winners. It’s a dirty job, but someone has to do it. So, without further ado, we present the 2009 P.U.-Litzers.

–The Remembering Reagan Award
WINNER: Joe Klein, Time

Time columnist Joe Klein (12/3/09), not altogether impressed by Obama’s announcement of a troop escalation in Afghanistan, wrote that a president “must lead the charge–passionately and, yes, with a touch of anger.”

He described the better way to do this:

Ronald Reagan would have done it differently. He would have told a story. It might not have been a true story, but it would have had resonance. He might have found, or created, a grieving spouse–a young investment banker whose wife had died in the World Trade Center–who enlisted immediately after the attacks…and then gave his life, heroically, defending a school for girls in Kandahar. Reagan would have inspired tears, outrage, passion, a rush to recruiting centers across the nation.

Ah, Reagan–now there was a president who could inspire people to fight and die based on lies.

–The Cheney 2012 Award
WINNER: Jon Meacham, Newsweek

Newsweek editor Jon Meacham declared (12/7/09) that Dick Cheney running for president in 2012 would be “good for the Republicans and good for the country.” He explained that “Cheney is a man of conviction, has a record on which he can be judged, and whatever the result, there could be no ambiguity about the will of the people…. A campaign would also give us an occasion that history denied us in 2008: an opportunity to adjudicate the George W. Bush years in a direct way.”

While the 2008 election might have seemed a sufficient judgment of the Bush years, it’s worth pointing out that at beginning of the year (1/19/09), Meacham was adamantly opposed to re-hashing Cheney’s record, calling it “the rough equivalent of pornography–briefly engaging, perhaps, but utterly predictable and finally repetitive.” The difference? That was in response to the idea that Cheney should be held accountable for lawbreaking. Apparently a few months later, the same record is grounds for a White House run.

–The Them Not Us Award
WINNER: Martin Fackler, New York Times

The New York Times (11/21/09) describes the severe problems with Japan’s elite media–a horror show where “reporters from major news media outlets are stationed inside government offices and enjoy close, constant access to officials. The system has long been criticized as antidemocratic by both foreign and Japanese analysts, who charge that it has produced a relatively spineless press that feels more accountable to its official sources than to the public. In their apparent reluctance to criticize the government, the critics say, the news media fail to serve as an effective check on authority.”

The mind reels.

–Thin-Skinned Pundits Award
WINNER: Dana Milbank, Washington Post

Washington Post reporters Dana Milbank and Chris Cilizza got into trouble when, in an episode of their “Mouthpiece Theater” web video series, they suggested brands of beer that would be appropriate for various politicians. What would Hillary Clinton drink? Apparently something called “Mad Bitch.” The video, unsurprisingly, was roundly criticized, and was pulled from the Post site. So what lesson was learned? Milbank complained (8/6/09) that “it’s a brutal world out there in the blogosphere…. I’m often surprised by the ferocity out there, but I probably shouldn’t be.”

Yes, the problem with calling someone a “bitch” is the “ferocity” of your critics.

–The Sheer O’Reillyness Award
WINNER: Bill O’Reilly, Fox News Channel–TWICE!

1) Asked by a Canadian viewer, “Has anyone noticed that life expectancy in Canada under our health system is higher than the USA?,” Fox’s O’Reilly (7/27/09) responded: “Well, that’s to be expected, Peter, because we have 10 times as many people as you do. That translates to 10 times as many accidents, crimes, down the line.”

2) Drumming up fear of Democrats’ tax plans: “Nancy Pelosi and her far-left crew want to raise the top federal tax rate to 45 percent. That’s not capitalism. That’s Fidel Castro stuff, confiscating wages that people honestly earn.”

Perhaps Castro was president of the United States in 1982-86, when the top rate was 50 percent. Or maybe all of the 1970s, when it was 70 percent. Or from 1950-63, when it was 91 percent.

–The Less Talk, More Bombs Award
WINNER: David Broder, Washington Post

Post columnist Broder expressed the conventional wisdom on Barack Obama’s deliberations on the Afghanistan War, writing under the headline “Enough Afghan Debate” (11/15/09):

It is evident from the length of this deliberative process and from the flood of leaks that have emerged from Kabul and Washington that the perfect course of action does not exist. Given that reality, the urgent necessity is to make a decision–whether or not it is right.

–The Racism Is Dead Award
WINNER: Richard Cohen, Washington Post

Post columnist Richard Cohen wrote (5/5/09): “The justification for affirmative action gets weaker and weaker. Maybe once it was possible to argue that some innocent people had to suffer in the name of progress, but a glance at the White House strongly suggests that things have changed. For most Americans, race has become supremely irrelevant. Everyone knows this. Every poll shows this.”

For the record, “every poll” does not actually show this; the vast majority of Americans continues to recognize that racism is still a problem. Cohen went on to write months later–still presumably living in his racism-free world–that he did not believe Iran’s claims about its nuclear program, because “these Persians lie like a rug.”

–The When in Doubt, Talk to the Boss Award
WINNER: Matt Lauer, NBC News

Today show host Lauer announced a special guest on April 15: “If you really want to know how the economy is affecting the average American, he’s the guy to talk to.” Who was Lauer talking about? Wal-Mart CEO Mike Duke. The ensuing interview touched on the Employee Free Choice Act, which Lauer noted was supported by many unions but opposed by some large corporations–leading him to ask Duke, “What’s the truth?” Yes, look for “the truth” about a proposed pro-labor bill from the new CEO of an adamantly anti-labor corporation.

–The Socialist Menace Award
WINNER: Michael Freedman, Newsweek

Newsweek’s “We Are All Socialists Now” cover (2/16/09) certainly turned heads, but one of the stories inside explained in more detail the real threat. As senior editor Michael Freedman asked: “Have you noticed that Barack Obama sounds more like the president of France every day?”

The real problem, though, is what that’s going to do to us Americans, says Freedman: “If job numbers continue to look dismal, or get even worse, an ever-greater number of people will start looking to the government for support…. It’s very easy to imagine a chorus of former American individualists demanding cushy French-style pensions and free British-style healthcare if their private stock funds fail to recover and unemployment inches upward toward 10 percent and remains there.”

Pensions and healthcare for all–this is worse than we thought!

–The Iraq All Over Again Award
WINNER: Too Many to Name

After the invasion of Iraq, countless journalists who had treated allegations about Iraq’s weapons of mass destruction as facts were embarrassed when there were no such weapons to be found. So you’d think they’d be more careful about thinly sourced claims that Iran is seeking nuclear weapons. But in 2009, many journalists are still willing to treat such allegations as facts.
-NBC’s Chris Matthews (10/4/09): “As if Afghanistan were not enough, now there’s Iran’s move to get nuclear weapons.”
-NBC’s David Gregory (10/4/09). “Iran–will talks push that country to give up its nuclear weapons program?”

-Fox News Channel’s Bill O’Reilly (9/25/09): “All hell breaking loose as a new nuclear weapons facility is discovered in Iran, proving the mullahs have been lying for years…. Iran’s nuclear weapons program has now reached critical mass. And worldwide conflict is very possible. Friday, President Obama, British Prime Minister Brown and French President Sarkozy revealed a secret nuclear weapons facility located inside Iran.”

Some even went further, turning allegations of a nuclear weapons program into the discovery of actual nuclear weapons:

-ABC’s Good Morning America host Bill Weir (9/26/09): “President Obama and a united front of world leaders charge Iran with secretly building nuclear weapons.”

–The Talking Like a Terrorist Award
WINNER: Thomas Friedman, New York Times

In a January 14 column, New York Times superstar pundit Tom Friedman explained Israel’s war on Lebanon as an attempt to “educate” the enemy by killing civilians: The Israeli strategy was to “inflict substantial property damage and collateral casualties on Lebanon at large. It was not pretty, but it was logical.” Friedman added, “The only long-term source of deterrence was to exact enough pain on the civilians–the families and employers of the militants–to restrain Hezbollah in the future.” That strategy of targeting civilians to advance a political agenda is usually known as terrorism; Osama bin Laden couldn’t have explained it much better.

–The It Only Bothers Us Now Award
WINNER: Wall Street Journal editorial page

When Barack Obama only called on journalists from a list during a press conference, the Wall Street Journal did not like the new protocol (2/12/09):”We doubt that President Bush, who was notorious for being parsimonious with follow-ups, would have gotten away with prescreening his interlocutors.”

Actually, Bush was famous for calling only on reporters on an approved list; as he joked at a press conference on the eve of the Iraq War (3/6/03), “This is scripted.”

–The No Comment Award
WINNERS: MSNBC’s Mika Brzezinski and Rush Limbaugh

When asked by Politico (10/16/09) to name her favorite guest, MSNBC host Mika Brzezinski named arch-conservative Pat Buchanan “because he says what we are all thinking.”

Rush Limbaugh on Obama (Fox News Channel, 1/21/09): “We are being told that we have to hope he succeeds, that we have to bend over, grab the ankles…because his father was black.”

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The month of January gets its name from Janus, the Roman god of gates, doorways, and transitions (beginnings/endings). Artists depicted Janus with two faces – or sometimes two heads – which looked both forward and back. At year’s end, we look behind us at the previous year, with lists of the best movies, best books, most important news stories, and so on. We also look ahead, with soon-to-be-forgotten lists of resolutions for the new year.

In the spirit of Janus, I’ve looked back and collected some memorable quotes from 2009, with two bonus quotes from previous years. I tried to pin down the exact dates, but I missed a few. Some of the quotes might inspire or disgust you. Others might make you laugh. I thought about explaining the quotes or putting the important parts in bold, but then I chose not to clutter up the list. So, here they are, memorable quotes from 2009, in no particular order:

“The first thing you need to know about Goldman Sachs is that it’s everywhere. The world’s most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.”

  – Matt Taibbi (Rolling Stone, 7/13/09)

“Let’s say this slowly: the Bush administration wanted to use 9/11 as a pretext to invade Iraq, even though Iraq had nothing to do with 9/11. So it tortured people to make them confess to the nonexistent link. There’s a word for this: it’s evil.”

  – Paul Krugman (NY Times, 4/22/09)

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“You’ll have lots of ‘splainin’ to do.”

  – Sen. Tom Coburn, doing an ill-considered impersonation of Desi Arnaz (Sotomayor confirmation hearings, 7/15/09)

“This is for my friend Ted Kennedy.”

  – Sen. Robert Byrd (after voting for the health care bill, 12/24/09)

“No matter what Michael wanted, someone would give it [to him]. The very rich, the very poor, and the very famous get the worst medical care.”

  – Dr Arnold Klein, Michael Jackson’s dermatologist (ABC News, 7/8/09)

“You give me a waterboard, Dick Cheney, and one hour, and I’ll have him confess to the Sharon Tate murders.”

  – Jesse Ventura (CNN, 5/11/09)

“If I could speak the language of rabbits, they would be amazed, and I would be their king. I would be kind to my rabbit subjects … at first.”

  – Raj (from the TV show “The Big Bang Theory”)

“Keep Your Government Hands Off My Medicare!”

  – Some teabagger (somewhere, whenever)

“I wouldn’t be here if it weren’t for the NHS [National Health Service]. I have received a large amount of high quality treatment, without which I would not have survived.”

  – Professor Stephen Hawking (The Guardian, 8/11/09)

“We are a nation of Christians and Muslims, Jews and Hindus, and nonbelievers.”

  – Pres. Barack Obama (inauguration speech, 1/20/09)

“Daddy, the plane turned into a boat.”

  – Four-year-old daughter of Martin Sosa (on board the USAir plane that ditched in the Hudson River, 1/15/09)

“Finally, a guy who says what people who aren’t thinking are thinking.”

  – Jon Stewart’s cogent summary of Glenn Beck (“The Daily Show”)

“I have trouble listening to what he [Cheney] says sometimes because of the blood that drips from his teeth while he’s talking.”

  – Rep. Alan Grayson (Hardball, 10/22/09)

“You lie!”

  – Rep. Joe Wilson (during Obama’s speech to a joint session, 9/9/09)

“I hope he fails.”

  – Rush Limbaugh, talking about Obama (1/16/09)

“I didn’t vote for him but he’s my President, and I hope he does a good job.”

  – John Wayne, talking about JFK (way back in 1960)

“We are the only advanced country in the world that has chosen to leave health care to the tender mercies of a panoply of for-profit businesses, whose purpose is to maximize income and not to provide health. And that’s exactly what they do.”

  – Marcia Angell (Bill Moyers Journal, 7/24/09)

“At least he died doing what he loved most: blogging on the Huffington Post.”

  – Kenneth (from the TV show “30 Rock”)

“We did not have a terrorist attack on our country during President Bush’s term.”

  – Dana Perino, Bush’s former Press Secretary (Fox News, 11/24/09)

“Arguing with you is like having an argument with my dining room table.”

  – Rep. Barney Frank (at a town hall meeting, after someone compared Obama to Hitler)

“Did he just say ‘revenge is a dish best served cold’ in Klingon?”

  – Wil Wheaton/Wesley Crusher (on the TV show “The Big Bang Theory”)

“I think it’s great that Americans are able to choose one or the other. We live in a land that you can choose same-sex marriage or opposite marriage and, you know what, in my country and my family I think that I believe that a marriage should be between a man and a woman.”

  – Carrie Prejean (Miss USA Pageant, 4/20/09)

“I believe marriage is meant to be a sacred institution between two unwilling teenagers.”

  – Tina Fey as Sarah Palin (“Saturday Night Live,” and yeah, I know it’s from 2008)

“It’s hard to talk when you’re teabagging.”

  – Anderson Cooper (CNN, 4/14/09)

“When I was 13 years old, my beautiful mother and my father moved me from a conservative Mormon home in San Antonio, Texas, to California and I heard the story of Harvey Milk. And it gave me hope. It gave me the hope to live my life, it gave me the hope to one day live my life openly as who I am and that maybe even I could fall in love and one day get married.”

  – Dustin Lance Black (acceptance speech after winning the Oscar for Best Original Screenplay, 2/22/09)

See The Lives They Lived, 2009, The New York Times Magazine, December 27, 2009:

Each year newspapers and magazines document the lives and deaths of hundreds of notable people. And each year we put together a special issue that peeks into some of those lives — an admittedly eclectic, idiosyncratic project, one driven by the passions, quirks and curiosities of our writers and editors. This year those interests led us to some very well known names but also to many lesser-known ones, each worthy, in one way or another, of exploration and appreciation.

A Patient’s View of the Senate Healthcare Gift, Common Dreams, December 24, 2009, by Donna Smith, quoted verbatim:

So, all the great fanfare and all the king’s horses.  The great and almighty U.S. Senate has spoken.  I will have to buy private health insurance — forever, amen.  The defective product that has left me wanting for real healthcare for all of my adult life is now a step closer to being the law of the land.

A lump of Christmas coal all polished up with sparkling rhetoric.

Here’s what the Chicago Tribune said this week, and I agree:

On Sunday, the Chicago Tribune published an exhaustive front-page analysis by Northwestern University‘s Medill News Service and the Center for Responsive Politics of how it was done. The main culprit: “a revolving door between Capitol Hill staffers and lobbying jobs for companies with a stake in health care legislation.”

The study found that 13 former congressmen and 166 congressional staffers were actively engaged in lobbying their former colleagues on the bill. The companies they were working for — some 338 of them — spent $635 million on lobbying. It was money extremely well spent — delivering a bill that, by forcing people to buy a shoddy product in a market with no real competition, enshrines into law the public subsidy of private profit.

As we approach the end of Obama’s first year in office, this public subsidizing of private profit is becoming something of a habit. It is, after all, exactly what the White House did with the banks. Just as he did with insurance companies, Obama talked tough to the bankers in public, but, when push came to shove, he ended up shoving public money onto their privately held balance sheets.

This is not just bad policy, it’s bad politics.

Now, back to my own thoughts as a patient:

I went broke while carrying health insurance, a disability insurance policy and a small healthcare savings account.  And if I get sick under this mess of a plan, it will happen to me again.  Little has changed except that millions more of my fellow citizens will join my ranks.

How does it happen to insured people under this plan? Easy.  Step-by-torturous-step.  Slowly.  Like water-torture.

1. Buy health insurance at work or on the new exchange;

2. Avoid using insurance due to co-pays, deductibles and out-of-pocket maximum exposures — not to mention lost work time and the worry about losing one’s job in a tough economy;

3. If symptoms are noticed, treat by internet medical site suggestions and over-the-counter drugs until no other option but going to a doctor are available;

4. Attempt to make appointment with doctor but first find one who accepts both new patients and your insurance;

5. Go to doctor and pay co-pay up front before ever speaking to anyone about medical problem;

6. Sit in outer waiting room for as long as required, missing work and worrying;

7. Sit in exam room waiting for doctor for as long as required;

8. See doctor for five or six minutes, if lucky, during which time you will either be prescribed some expensive drug to fix a problem the doctor isn’t sure you have, referred to another doctor who may have a month or two wait for appointments, be directed to get some tests done you aren’t sure your insurance will allow or pay for, and do it all sitting in your underwear or less;

9. Leave medical office owing more than what you thought your insurance and co-pay advertised (and never get an explanation for how that is possible)  and never sure if this experience was much different than being to a used car lot where the sales folks have assessed your financing mechanism before showing you anything at all and then only show you what fits the financing not what you need or want;

10. In the alternative, if you collapse or wait until symptoms get so severe that going for an office appointment is impossible, go to an emergency room — repeat steps five through eight — and either be admitted to the hospital if your insurance is adequate and you have any available sick-time from work (if not, beg for drugs and to be released) or go to number nine.

11. Need a dentist?  Too bad.  Have dental insurance?  Still too bad.  You might get a cleaning and some x-rays, but getting the care you may or may not need will be again totally related to your ability to pay whatever portion of the dental work is not covered (and amazingly, every penny of what dental insurance will cover will be eaten up by whatever problem you may or may not have) — in the alternative, avoid dentists or just pull teeth as they go bad;

12. When the bills roll in, try to pay some after trying to find out how you can possible owe hundreds if not thousands more than the insurance policy you have indicates is possible;

13. When the collectors call to collect all of the balances due, try to negotiate payments but endure threats of lawsuit, garnishment and worse as the collectors report back to the doctors you saw for a few moments in number eight;

14. Try to get your meds — if too costly, go without;

15. Try to get well — if you cannot, go back to work;

16. Try to act like this is all wonderful and you are grateful to have any insurance at all;

17. Get sued by a collection agency for a doctor bill or hospital bill you cannot cover;

18. Sell your house and use whatever proceeds you have to try to pay some of the debts;

19. Collectors for the doctors and hospitals are not happy if you don’t pay it all in full and up-front most of the time;

20. Feel stress, fear, anguish — but don’t gripe and don’t show it at work — buck it up, chump;

21. Sell keepsakes and anything valuable to try to stay afloat;

22. Stress, more stress.  Fear to answer the phone.  Friends and family fall away as they don’t want you to ask to borrow money;

23. Keep working — sick or not, keep working or you’ll lose that damn insurance if you cannot pay the premium — or you’ll be back out on the exchange trying to buy another policy that is cheaper and even worse;

24. Watch your elected officials claim victory and history as they work to make sure your kids and grandkids must suffer the same fate if they need healthcare in America;

25. Have a Merry Christmas, so says your U.S. Senate.

Don’t think this can happen to you because it hasn’t yet?  Count your blessings this Christmas.

I’d really like the gift of healthcare. Medicare for all, single-payer healthcare would remove so much of this awful process. That would be a gift.

Donna Smith is a community organizer for the California Nurses Association and National Co-Chair for the Progressive Democrats of America Healthcare Not Warfare campaign.