A "landmark" we still can't see

For the most part, the big media and housing nonprofits have bought the government’s hype on the recent foreclosure fraud settlement, lauding it with great fanfare as a historic landmark.

It’s a good thing that not all our national landmarks are as phony as that settlement has turned out to be.

If they were, none of them would still be standing.

If big media had taken a more objective view, rather than just copying the authorities’ press releases, they might have chosen another, much less dramatic description, such as “yet to be released.”

The best description might take a few more words: “designed to make the Obama administration and state attorneys general look like they’re doing something while letting banks off the hook and leaving homeowners out in the cold and taxpayers and investors holding the bag.”

The settlement continues to raise more questions than it answers. For example, California’s attorney general Kamala Harris announced that the state would get $18 billion in foreclosure relief from the national settlement.

But then a couple of days later, Jeff Collins of the Orange County Register reported that Harris hadn’t offered a complete explanation.

As it turns out, the state might get only $12 billion.

The amount, Harris’ people explained to Collins, depends on which of two methods you used to calculate it.

“There are two sets of numbers,” said Linda Gledhill, a Harris spokeswoman told Collins.

Hah! Who knew?

One method calculates the cost of the settlement to banks, which as explained in the settlement’s “executive summary” are required to provide $25.2 billion in a variety of forms of assistance to borrowers. But providing that assistance doesn’t actually cost them $25 billion.

Apparently the settlement only requires the banks to pay out $5 billion in cash, with the balance consisting of a yet to be released complex system of credits that the the government will give the banks credit for offering the assistance, with details yet to be announced.

Meanwhile, the Financial Times (registration required) has been parsing the sparse publicly available details about the settlement. Their prognosis: The settlement shifts the costs of modifying mortgages from the banks to the taxpayers and to investors who bought securitized mortgages. As a result, it resembles another bailout more than it does a settlement.

Neil Barofsky, the former Inspector-General of the Troubled Asset Relief Program told the FT:

“If the banks are doing something under this settlement, and cash flows from taxpayers to the banks, that is fundamentally an upside-down result.”

And keep in mind that the actual settlement agreement still hasn’t been released yet, more than ten days after it was announced. What exactly is the hangup?

Do the authorities really expect us to take their word for it? How gullible do they think we are?

Remember how the 2008 bank bailout started: a three-page document submitted by the treasury secretary.

As my colleague Harvey Rosenfield warned when the President first announced the settlement, we’ll be in for a lot of surprises when the actual settlement is actually released, whenever that will be.

And something tells me they won’t be the good kind of surprises.

California Attorney General Kamala Harris / Foreclosure / Martin Column / President Barack Obama / SIGTARP - 02/22/2012

The Supreme Court Shot the Sheriff

"Corporations are people." Two years ago, that's what five justices of the United States Supreme Court gaveled into our Constitution, ruling in the now-infamous Citizens United case that spending money is a form of "freedom of speech" and that when corporations put up money to elect people, they are just exercising their First Amendment rights.

Two months ago, the Montana Supreme Court said wait a minute. It upheld a state law, enacted by Montana voters through the initiative process in 1912, that bars corporations from trying to influence elections. The justices of the Montana Supreme Court argued that the Montana law is different than the federal law that the US Supreme Court threw out, relying on what they described as an especially disturbing history of corporate corruption in Montana government.

When it comes to constitutional law, you can't get closer to the Gunfight at the O.K. Corral than this, as I recently explained.

That's a better analogy than you think.

The campaign finance laws, designed over decades to slow down the accretion of political power by special interests, were like a lazy sheriff in a western gold rush town - barely able to keep up with the legal and illegal maneuverings of outlaw corporateers, while average citizens became increasingly like bystanders in their own democracy.

Then the Supreme Court rode into town and shot the sheriff.

Now we are back to the Wild West, with corporate gunslingers targeting anyone - officials and civilians – who are in the way of their profits and prerogatives. Corporate money, often disguised and hidden behind a fortress of deception, has charged through the Republican presidential primaries, not to mention an untold number of state elections throughout the country. The full fury of this greed-driven onslaught will become apparent in the fall, as Wall Street and the .01 percenters weigh in not just to defeat President Obama (who has not cooperated enough) but any number of other candidates on ballots nationwide, not to mention initiatives put on the ballot by real, live citizens detouring corrupt legislators by taking matters into their own hands.

You can already sense defeat among government officials trying to figure out what defenses, if any, are left against the corporate hordes - the CEOs in their sky-high boardrooms quietly counting dollars and deciding which politicians have earned their financial support (or can be bought); the lobbyists with unlimited expense accounts to wine, dine and drive the quid pro quo; the vast underground of consulting firms and PR flacks that follow corporate orders.

No one could have imagined that Montana, with a population barely larger than a big city, would rise to challenge the United States Supreme Court. The Montana court ruling is an inspiring attempt to evade the deathly embrace of Citizens United and, at the same time, inescapably a courageous challenge to the ideologues now re-writing the nation's laws. It can be found here (PDF).

"Western Tradition Partnership" – the shadowy entity that was caught violating Montana's anti-corrupt practices act – immediately challenged the Montana decision, and last Friday, United States Supreme Court Justice William Kennedy (chief author of the Citizens United decision) issued an order blocking the Montana court ruling from taking effect until the court decides what to do with the appeal.

At least two of the Supreme Court justices who disagreed with their colleagues in Citizens United are hoping the Court will reconsider that ruling. In Friday's order, Justices Ginsberg and Breyer stated:

Montana’s experience, and experience elsewhere since this Court’s decision in Citizens United v. Federal Election Comm’n, 558 U. S. ___ (2010), make it exceedingly difficult to maintain that independent expenditures by corporations “do not give rise to corruption or the appearance of corruption.” .... [The appeal] will give the Court an opportunity to consider whether, in light of the huge sums currently deployed to buy candidates’ allegiance, Citizens United should continue to hold sway.

Observers of the Court think that's a lost cause. Renowned constitutional scholar Erwin Chemerinsky believes that the U.S. Supreme Court will reverse the Montana Supreme Court by the same five to four majority in Citizens United. Still, Citizens United's impact on America's democracy has already been catastrophic, and support for proposals like ours to amend the Constitution has spread across the United States and transcends partisan labels. At the same time, Justices Scalia, Thomas and Alito are under fire for their close ties to conservative pro-business organizations, further undermining confidence in the impartiality of the nation's highest court. I would not underestimate the power of public opinion to affect the outcome of this showdown – if not now, then in the not too distant future of our country.

 

 

Citizens United / Harvey Column / Uncategorized - 02/21/2012

“There Oughta Be A Law” – Want to Play?

I wrote last week that until we change the Constitution to permanently kick corporate money out of politics, we can forget about Congress protecting us from cell phone company contracts that strip consumers of their right to go to court.

I got a lot of interesting email on that post, because most people who read “Where’s Our Money” and other blogs think there “oughta be a law” of some kind. But no matter what you believe in or where you stand on the ideological spectrum, anybody who is trying to make America a better place for human beings is going to have a hard time overcoming the corrupting effect of corporate money on public officials and the democratic process.

Think I’m wrong? Here’s my challenge:

Name a policy issue that involves our power as voters, consumers, workers, taxpayers or even shareholders and I will show you how corporate money has derailed any serious progress on the matter.

If you don’t want to post it publicly, just ask that your comment remain private, or send me an email.

The same day I mused on our new status as second-class citizens courtesy of the US Supreme Court’s Citizens United decision, President Obama’s re-election campaign endorsed a constitutional amendment to reverse that ruling. "The President favors action—by constitutional amendment, if necessary—to place reasonable limits on all such spending," the Obama campaign said. This came in the context of a another controversial move: the President had decided to encourage supporters to donate to one of the Super PACs supporting him. “Super PACs” are the shadowy groups that the Supreme Court freed of restraints on political spending in Citizens United. Tens of millions of dollars, most of it from unidentified corporations and wealthy donors, have poured into the Republican primaries. But that’s just a fraction of what Super PACs are expected to spend to unelect Barack Obama in November.

In a stark example of biting the hand that has fed it, Wall Street has made it clear that it is offended even by the timid financial reforms mustered by the Obama Administration over the last few years. Now that the taxpayers have resuscitated the Money Industry, it wants to go all the way back to the insane deregulatory policies that pushed the nation into a depression in 2008.

There was a lot of critical commentary about the announcement, not just by hypocrite Republicans like John Beohner, but also by commentators on the left who feel Obama betrayed his commitment to campaign finance reform.

I for one can’t see how any candidate from either party can afford not to play by the deregulated rules of legalized bribery blessed by the Supreme Court. Like Obama’s campaign manager said, “unilateral disarmament” in the face of a massive attack of big money makes no sense. Our electoral system now assures the survival only of the financially fattest.

But will Obama really fight for the 28th Amendment? It’s one thing to endorse the concept and quite another to press for a change in the Constitution that would strip the corporate establishment of its power to elect candidates and dictate laws. The President has the bully pulpit and phenomenal power, but like the rest of us, he can't hope to pass any laws if corporations maintain a hammerlock over the legislative branch. No one knows better than he how the powerful insurance lobby turned health care reform into a corporate boondoggle. If President Obama thinks there oughta be a law, any meaningful law, in his second term, he's going to have confront Citizens United.

 

Citizens United / Congress / Harvey Column / Supreme Court / Uncategorized - 02/13/2012

Second-Half Score Depends on Who Calls the Plays

Clint Eastwood’s Chrysler ad during the Super Bowl knocked me out.

It was stunningly effective piece of work. It resonated deeply with me as a skillfully crafted message – even as I knew it wasn’t telling the whole truth about the comeback of Detroit, my hometown.

Still, I wanted to believe, if only for a few minutes, that we could work together to confront our national problems, and millions of other Super Bowl watchers joined me in that yearning.

It reminded me of another inspired piece of highly distilled corn-pone football-inspired poetry: what Coach told his players on `Friday Night Lights,’ “Clear eyes, full hearts, can’t lose.”

With its irresistibly simple pep-talk pitch, the ad stirred up strong feelings, both for what it said and what it left unsaid about what’s actually going on in Detroit and the U.S.

It showed once again the power of plain language, delivered in Eastwood’s classic growl.

It reminded me how ineffective those of us who oppose corporate power have often been in claiming for our cause our deeply rooted patriotism and our pride in how every-day Americans have fought again and again, against terrible obstacles, to build a democracy that would work for everyone.

It also provoked deep feelings about Clint Eastwood, the ever-evolving artist.

He's been a great champion of Detroit. He made one of his finest films, “Gran Torino,” in the city. Released in 2008 in the wake of the financial collapse, it tells the story of the redemption of a retired autoworker, recently widowed and deeply racist.

Reviewing the film, Manohla Dargis wrote in the New York Times: “Melancholy is etched in every long shot of Detroit’s decimated, emptied streets and in the faces of those who remain to still walk in them. Made in the 1960s and `70s, the Gran Torino was never a great symbol of American automotive might, which makes Walt [Eastwood’s character’s] love for the car more poignant. It was made by an industry that now barely makes cars, in a city that hardly works, in a country that too often has felt recently as if it can’t do anything right anymore except, every so often, make a movie like this one.”

Eastwood made `Gran Torino’ under the generous tax breaks of a program designed to encourage filmmaking in Detroit, a program that has since been limited by the state’s current Republican governor, eroding the promise of the nascent film industry.

For the Chrysler ad, the auto company enlisted not only Eastwood, but hired a top ad agency, Wieden-Kennedy; the director of several terrific films, David Gordon Green; and two top-notch writers: Oregon-based poet Matthew Dickman and Texas-based fiction writer, Smith Henderson.

Even so, it’s an ad, meant to sell cars by inspiring hope and pride in Americans’ ability to get up and come back after a hard punch.

So the ad doesn’t quite tell you the real score at the end of the first half, nor does it come entirely clean on who's been playing on which team.

If the 99 percent were writing the script, not Chrysler, Eastwood might have something very different to say about our game plan as the second half gets underway.

It doesn’t mention that the majority owner of Chrysler is now Fiat, an Italian auto firm, or that Chrysler, newly profitable after it $12.5 billion taxpayer bailout, now pays new employees $14-$16 an hour, about half of what Chrysler employees used to be paid.

“The gratitude that many Detroit workers felt just after the bailout,” Reuters reported last October, “has given way to a frustrated sense that blue-collar workers have not shared equally in the industry's comeback.”

I wonder what Clint Eastwood’s characters might say about our current predicament.

Something tells me Eastwood’s iconic Dirty Harry character wouldn’t think much of our state attorneys general’s settlement with the big banks, which lets the bankers off the hook for fraud in the foreclosure process in exchange for ineffective and inadequate assistance for homeowners.

Describing the $26 billion settlement, the Times acknowledges it would “help

a relatively small portion of the millions of borrowers who are delinquent and facing foreclosure.”

Meanwhile, while it will be good for the banks to get the foreclosure fraud charges behind them, it remains unclear how much the settlement will help the “moribund” housing market, the Times reports.

The $26 million will be distributed to states according to a complex formula. Actual victims of foreclosure fraud are supposed to get about $1,500 apiece. An undetermined number of underwater homeowners will get their principals written down by about $20,000. Some funding will also go to further investigation into banker fraud and consumer education.

Unfortunately neither the Obama Administration nor the AGs’ credibility is very good in living up to previous promises to help homeowners. Previous administration efforts, as well as previous AG settlements, have delivered much less than they initially promised, plagued by inadequate oversight and relying on voluntary bank participation. For more details, check Naked Capitalism; for more critique, Firedoglake.

What would Eastwood’s Dirty Harry think?

Just another day at the office, with the thugs getting away with their crimes in a world gone awry.

I couldn’t help wondering: would Dirty Harry negotiate with an intruder who robbed your house? Would he suggest to the intruder, “OK, just give back 30 percent of what you took and clean out the rain gutters and we’ll call it even?”

Unlikely. Dirty Harry would track down the crooks, scowl and start blasting away with his trademark .44 Magnum.

One of our previous presidents, Ronald Reagan, understood the visceral power of Dirty Harry and evoked him in a fight with Congress, when it was threatening to raise taxes. Reagan said he would veto any tax increase. “Go ahead,” the former president said, quoting the Dirty Harry character, “make my day.”

You’ll find very little of that spirit among the Obama administration officials and lawmen and law women assigned to the big bank beat.

Walt, the character in  `Gran Torino,’ and Dirty Harry are very different characters, separated by age and experience. They both live in broken worlds, filled with violence and cynicism. But confronted with today’s bankers, they would recognize them for what they are: shameless bullies, terrifying our neighborhood. And they would recognize the Obama administration and the state AGS who negotiated with them rather than investigated them for what they have become: cowards.

 

 

California Attorney General Kamala Harris / Foreclosure / Martin Column / President Barack Obama - 02/10/2012

The Truth About the AG Mortgage Settlement...."Coming Soon"

The "settlement agreement" between state attorneys-general, the Obama Administration and five large banks over unlawful home foreclosures was front-page news everywhere this morning. Only one problem: you can't get a copy of the agreement itself.  All we have is a few hand picked details promising "relief" to defrauded borrowers, and pledges by the banks that they'll obey the law from now on.

Check out the special web site, which proudly trumpets the "landmark settlement," the "historic"agreement and the "landmark relief," but offers only a factsheet entitled "Servicing Standards Highlights" that purports to summarize the deal, and a bunch of phone numbers for the banks and the AGs.

Everything else is "coming soon."

This is an outrage, and frankly, the news media and all the rest of the pundits out there ought to have demanded the full and complete document before heralding the settlement as a major event. To my astonishment, most of the reports I read today failed to note that the actual settlement agreement has not been released to the public.

Ever heard of the lawyer's favorite maxim, "the devil's in the details"? The banks here were accused of failing to comply with legal technicalities like proving that they actually held the mortgage to the homes they foreclosed on.  When it comes to themselves, the bankers know those details matter: You can be sure that their lawyers have negotiated and reviewed every single comma. Shouldn't American taxpayers and homeowners, who have borne the terrible brunt of these banks' gross irresponsibility and greed for the last three years, had a chance to review the proposal before our elected officials signed on the dotted line?

I've seen this kind of stunt many times before - for example,  a settlement of a lawsuit that was described by the parties in a press release as returning $500 million in overcharges to insurance customers. Months later, the settlement agreement itself is quietly filed with the court, and surprise! You had to fill out a ten page claim form to get your money, and the insurance company got to keep whatever's left. (As a lawyer for one of the policyholders, I joined with Consumer Watchdog in an objection to the settlement.)

It is no little irony that many people lost their homes because they didn't read the fine print of the loans, or couldn't understand what it meant. But when it comes to the settlement of the fiasco, no one can read it even if they want to. We have nothing in print, fine or otherwise, beyond the press materials.

Remember you heard it first here: there'll be lots of surprises when we finally get to look at the details of this deal.

 

 

Foreclosure / Foreclosures / Harvey Column - 02/10/2012

Betrayals and Bailouts

In the latest betrayal from Freddie Mac, the same clever devils who helped bring us the financial collapse three years ago, there is unfortunately no surprise.

The high rollers who run the company, whose mission is supposed to be to support homeowners, apparently still think it’s a good idea to use our homes as a casino.

That’s the conclusion reached in an investigative report by NPR/Pro Publica, which found that Freddie Mac had placed billion-dollar investment bets that paid off when borrowers couldn’t refinance from high-interest mortgages into more affordable loans.

According to the NPR/Pro Publica report, Freddie Mac increased “these bets dramatically in late 2010, the same time that the company was making it harder for homeowners to get out of such high-interest mortgages.”

In effect, Freddie Mac combined high interest mortgages into packages of securities and sold some to speculators, but it kept the ones that would result in the biggest profits so long as the homeowner never refinanced. Freddie Mac stands to lose if its customers refinance and taske advantage of lower rates.

Freddie Mac was betting against homeowners even though taxpayers had bailed out it and its larger sister, Fannie Mae and the government placed the under a conservatorship after the housing bubble burst in 2008 and it faced mounting mortgage losses.

Though Freddie Mac and Fannie Mae are known as government-sponsored entities, they in fact have been private, profit-making entities for four decades.

Congress created Fannie and Freddie as private companies with a public mission ­– supporting homeownership, by insuring the mortgages issued by commercial lenders. But the companies had government officials sitting on their boards, and got breaks on taxes and recordkeeping requirements.

During the real estate bubble, the two firms adopted all the bad behavior of other big financial institutions – and worse. Authorities found that at Fannie Mae, senior executives cooked the books between 1998 and 2004, making it look like they hit profit targets in order to justify $115 million in bonuses. Three top executives eventually reached a $31.4 million settlement [with govt or private private pre-bailout] – without admitting guilt.

Executives at the Freddie Mac and Fannie Mae spent millions on campaign contributions and lobbying, courting both Democrats and Republicans (including presidential contender Newt Gingrich) in a successful campaign to ward off more stringent regulation and tighter reins on their bookkeeping, all the while taking on greater amounts of risk, establishing close ties with one of the worst offenders in spreading toxic loans, Countrywide Bank. Meanwhile executives at the two firms were paid lavishly, even after the bailout.

Republicans love to blame the GSEs for the financial collapse, labeling them do-gooder agencies who went wrong in pursuing too aggressively an agenda of providing housing to low-income people.

In his excellent autopsy of the financial collapse, “The Great American Stick-up,” Robert Scheer finds merit in much of the conservative critique. He labels the Fannie Mae and Freddie Mac “highly culpable” for causing the financial crisis – but not for the reasons Republicans say. While the GSEs used the rhetoric of helping people, their efforts to boost low-income and middle-class wasn’t their primary mission, or the reason for their downfall.

Fannie and Freddie didn’t go under because they were trying too hard to help people; it was because they were doing everything they could to super-charge their profits, just like the Wall Street firms.

Scheer quotes the testimony of a one-time regulator, Armando Falcon, who faced stiff opposition from Republicans as well as Democrats when he tried to rein in Fannie and Freddie. Falcon testified in April 2010 before the Financial Crisis Inquiry Commission, which investigated the causes of the meltdown. “The firms would not pursue any activity…unless there was a profit to be made,” Falcon said. “Fannie and Freddie invested in subprime and Alt A mortgages in order to increase profits and regain market share. Any impact on meeting affordable housing goals was a by-product of the activity.”

 

 

 

 

Executive Pay / Foreclosure / Martin Column - 02/07/2012

There Oughta Be A Law…. But There Won’t Be Unless We Change the Constitution

Are you one of those people who are constantly saying “there oughta be a law”? I am - which is probably why I ended up a consumer advocate.

Some pretty lofty assumptions about democracy are built into that quaint phrase, if you think about it. For one, it assumes that law is a good way to resolve disputes (as compared, say, to fists or guns). Also, that everybody will obey the law. Perhaps most obvious, when someone says, “there oughta be a law,” they’re asserting our right as Americans to make things better for ourselves by getting the legislative branch to address an issue of public importance.

Indeed, the "the right of the people...to petition the Government for a redress of grievances" is built into the First Amendment - the same amendment that five members of the United States Supreme Court pretty much erased from the Constitution in the Citizens United case two years ago.

By now, everyone understands that by giving corporations the same First Amendment rights as humans, and then ruling that spending money to influence elections is a form of “free speech,” the Supreme Court in Citizens United unleashed a tsunami of corporate money that will drown out the voices of 99% percent of Americans in favor of the 1% who have the wealth to determine who wins elections. “Free” speech can’t compete with hundreds of millions of dollars of paid propaganda.

What’s not been much discussed is how the Supreme Court decision actually conflicts with the rest of the First Amendment: it has negated our right to petition government for a redress of grievances.

Consider another Supreme Court-imposed debacle: in 2011, the high court ruled that consumers who sue big companies in class actions can be thrown out of court and forced to go into “arbitration” – a system in which the company hires private “judges” to determine whether the company broke the law. The Federal Arbitration Act specifically says that arbitration doesn’t apply if the arbitration clause violates a state’s consumer protection law. But the Supreme Court refused to recognize that exception. The case is Concepcion v AT&T Mobility. In that lawsuit, consumers challenged AT&T for adding extra charges to the purchase of a cell phone that the company had advertised as “free.” The decision – another enormous victory for big corporations – strips American consumers of their right to hold a company accountable for rip-offs big or small.

Unlike the Court’s ruling in Citizens United, which interpreted the US Constitution, Congress could easily amend the Federal Arbitration Act to reverse the Concepcion decision. But will it? Forget about the House of Representatives: it’s controlled by corporate Republicans who are owned by the cell phone companies. (The House was close to passing a bill that would have allowed  telemarketers and debt collectors to call consumers’ cell phones with recorded messages. A huge public outcry delayed the legislation.)

But in the Democrat controlled US Senate, a bill to override the Supreme Court’s arbitration ruling has only fifteen cosponsors.

In California, we are lucky to have the ballot initiative, which allows us to take matters into our own hands when state legislators are too beholden to special interests to deal with important issues. Using the initiative process, California voters passed Proposition 103 to restrain price gouging by auto, home and business insurance companies. My colleagues at Consumer Watchdog are now proposing an initiative to put health insurance premiums under Proposition 103’s controls. But even the people’s initiative process has been corrupted by corporate money. And attempts to ban corporate interference in ballot initiative campaigns ran smack into, once again, a decision by the United States Supreme Court.

Indeed, you don’t have to be an astute observer of politics to know that corporate money has long corrupted politics. Our report, “Sold Out: How Wall Street and Washington Betrayed America” (PDF), published in March 2009, got right to the bottom line in its title. Between 1998 and 2008, Wall Street invested $5 billion in Washington, a combination of money for lobbying and campaign contributions that won deregulation and other policy decisions that enabled the financial industry to do as it pleased. The ensuing orgy of unbridled speculation came to a halt in 2008 when the financial industry threatened to shut down the system unless they got trillions of dollars in loans, tax breaks and other taxpayer bailouts.

Laws regulating corporate spending in elections and lobbying were intended to limit the damage to democracy. Some, including me, would argue that they didn’t work anyhow. But Citizens United has eliminated any chance of righting the imbalance of political power between corporations and human beings short of changing the United States Constitution itself. We’re proposing exactly that: a 28th Amendment to the Constitution that reads “The protections of the First Amendment that apply to the spending of money on lobbying and elections, whether by contributions, expenditures or otherwise, shall extend only to human beings.” Join us right now.

Citizens United / Harvey Column - 02/06/2012

In new Hollywood role, former senator plays the heavy

Thanks to Hollywood lobbyist and former Senate banking chair Chris Dodd for telling it like it is.

Dodd warned that Hollywood’s big-money contributors, who have been very, very good to President Obama and his fellow Democrats, might withhold their cash after the president expressed reservations over a controversial Internet anti-piracy bill.

Who ever would have guessed it would be Dodd, who during his 21-year-long career in Washington collected more than $48 million in campaign contributions, much of it from the financial industry he was supposed to be overseeing, who would cut through all the lies and palaver to deliver the knockout punch to our Citizens United-poisoned political system?

“Candidly, those who count on quote  `Hollywood’ for support need to understand that this industry is watching very carefully who's going to stand up for them when their job is at stake,” Dodd told Fox News. “Don't ask me to write a check for you when you think your job is at risk and then don't pay any attention to me when my job is at stake.”

But who better than Dodd to make clear what contributors expect for their cash.  He knows exactly how the system works, from both sides of the revolving door.

It was Dodd, after all, who made sure that AIG executives got their bonuses in 2009 while taxpayers were bailing out the firm at the heart of the subprime meltdown. It was no coincidence that AIG executives had showered Dodd with  $56,000 in contributions.

Nobody knows this terrain as well as Dodd.

He was a “friend of Angelo,” one of those elected officials who personally got sweet mortgage deals – at below market rates– from Angelo Mozilo, the head of the Countrywide, the mortgage company that nearly sank under the weight of its subprime trash loans until Bank of America rescued it. (His colleagues on the Senate Ethics Committee dismissed a complaint against him.)

While he and his colleague, Rep. Barney Frank (House Financial Services Committee?), oversaw the watering down of financial reform legislation in the wake of the financial crisis, Dodd played the role of beleaguered public servant, wringing his hands in frustration over the army of lobbyists against whom he was claimed he powerless.

But now that’s he moved from Washington to Hollywood, he’s got a new script that calls for tough, public, bare-knuckled threats to the president of the United States.

And whatever he owes the American public for his perfidy as an elected official, we owe him a debt of gratitude for it. Because he has exposed the political system and the money that dominates it for what it is.

As Dodd has illustrated so eloquently, the Supreme Court got it wrong in their infamous Citizens United decision, which allows corporations to dump unlimited, unreported cash into our political system.

Money is not free speech. I don’t know whether Bob Dylan had Congress in mind when he sang nearly 30 years ago, “Money doesn’t talk, it swears,” but he was prophetic.

The impact of money in politics has put a curse on our democracy, and it won’t be lifted until we throw the corporations and the billionaires’ money out.

As Dodd’s remarks demonstrate, big money campaign contributions are a blunt force instrument, which corporate interests and the wealthy can use to control the politicians who depend on them for their livelihoods, as Dodd did when he was playing the part of the distinguished U.S. senator.

Rest assured, the people who gave him $48 million knew his real role was so serve them, whatever lines he was required to utter for the scene he was playing at the time.

 

 

AIG / Citizens United / Congress / Executive Pay / Financial Crisis / Financial Reform Legislation / Martin Column - 02/01/2012