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How do we eliminate the paradox of poverty & privation amid plenty & abundance?

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Author Topic: How do we eliminate the paradox of poverty & privation amid plenty & abundance?  (Read 6486 times)
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9/11 WAS AN INSIDE JOB! www.ae911truth.org


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« Reply #80 on: August 22, 2011, 11:52:45 am »

“There’s class warfare, all right, but it's my class, the rich class, that’s making war, and we’re winning.”

-- Warren Buffet, New York Times, November 26, 2006

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http://www.alternet.org/module/printversion/151935

Standard and Poor's: Just More Corrupt Wall Street Insiders Waging Class War on America

By Joshua Holland
AlterNet
August 7, 2011

Standard and Poor's decision to downgrade our public debt [.pdf] tells us absolutely nothing about the probability of the federal government meeting its future obligations. The move really only offers us some compelling evidence of the corruption eating away at the foundations of yet another key Wall Street institution.

I should say that it offers us additional evidence. According to a Senate investigation concluded earlier this year — a probe that was greeted with a collective "ho-hum" by the corporate media — S&P and Moody's, another leading agency, “issued the AAA ratings that made ... mortgage backed securities ... seem like safe investments, helped build an active market for those securities, and then, beginning in July 2007, downgraded the vast majority of those AAA ratings to junk status.” And when they did, it “precipitated the collapse of the [mortgage-backed securities] markets and, perhaps more than any other single event, triggered the financial crisis. (PDF)”

According to the Senate investigation, in the years leading up to crash, “warnings about the massive problems in the mortgage industry” — including internal warnings from their own analysts — had been ignored because of the “the inherent conflict of interest arising from the system used to pay for credit ratings” — the big “rating agencies were paid by the Wall Street firms” that were making a fortune selling that glossed-up garbage to credulous investors.

The almost surreal irony here is that it was the economic crisis that the ratings agencies facilitated which led to a massive drop in tax revenues, and it was that, more than any other single factor, which caused the large deficits the federal government has been running in recent years. In other words, the agencies themselves played a pivotal role in driving up the national debt. Yet, rather than doing the honorable thing and throwing themselves out of their high-rise windows in the wake of the crash, S&P's management had the nerve to start playing politics with that very same debt.

At the height of the debate over raising the debt ceiling, the elite ratings agency issued a remarkable warning: The firm said that it would downgrade U.S. treasuries even if the limit were raised. The only way the government could avoid such a move, the agency warned, was for Congress to rubber-stamp the ostensibly “balanced,” $4 trillion debt-reduction package — one that included largely unspecified “entitlement reforms” — that Barack Obama had offered the GOP (S&P insisted that it didn't favor any specific policy approach, but it did specify a “balanced approach” worth $4 trillion shortly after Obama floated the proposal).

Congress eventually raised the limit in exchange for a lesser figure of up to $2.7 trillion worth of deficit reduction, and late Friday, after the markets were safely closed and the world's traders had headed home for the weekend, S&P shot its hostage.

[Continued...]

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