Apr 022009
Authors: Alex Stephens

If you thought the past few weeks of banking scandals and bailout bonuses were pretty crummy, it’s far from over.

A new investigation into the bonuses paid to Merrill Lynch executives in December may uncover some unpleasant truths about who is really pulling the strings of America.

Before the bank Merrill Lynch was “given” to Bank of America in September of 2008, it received $10 billion in TARP funding — tax payer dollars provided by former Treasury Secretary Henry Paulson, Jr. of the Bush administration and Ben Bernanke, chair of the Federal Reserve. What’s now being investigated is the $3.62 billion 36 percent of that TARP donation — in bonuses awarded to executives of Lynch.

These bonuses were not retention bonuses nor were they contractual obligations like AIG’s. Instead, these bonuses, claimed as performance-based, were awarded at the eleventh hour before Lynch posted a $15 billion quarterly loss, which effectively ended the company.

As Matt Renner wrote in his investigation of the issue on Truthout.org, the timing of it was very suspicious. New York Attorney General Andrew Cuomo has filed suit against the former CEO of the company, and along with Dennis Kucinich, D-Ohio, is desperately trying to find answers.

The big red flag of the issue is that the bonuses would not have been payable if they hadn’t received TARP money. Was our government truly unaware of the dealings?

I doubt it.

Paulson worked it so Bank of America would buy up the stocks of Merrill Lynch backed by a $118 billion guarantee against any potential losses incurred during the transition. That money, too, comes from us.

Paulson was formerly the CEO of investment bank Goldman Sachs, a hefty beneficiary of federal bailout aid that was prevented, apparently at any cost, from going under. More to the point, though, is that Paulson was too clever to just write Lynch a $10 billion check without dictating how it was to be spent. Unless he didn’t care.

But how peculiar is it for a former banking CEO to come to the rescue of all his banking allies (except the degenerate Lehman Brothers), convincing us that the world will come crashing down if we didn’t save them.

Our current Treasury Secretary, Timothy Geithner, is no better.

He helped Paulson orchestrate last falls’ corporate handouts, as well as AIG’s unseemly bonuses, and has been a part of Wall Street and Federal Reserve dealings over the past decade.

But so what? We should have qualified professionals who know their field of expertise, right?

When Obama took office, a blind eye was turned by his administration to the executive bonus pay. Then someone blew the media whistle. Oddly, Geithner informed the president of the AIG bonuses before they were distributed, and with plenty of time to stop them, but still they went through.

Afterward, the duo skillfully feigned over the bonuses, and the American public cheered, “Go get em,’ Obama!”

Oh, the revolving door of politics. Take a look at some of the largest campaign contributors for Obama: Goldman Sachs, AIG, JPMorgan Chase, Bank of America, Citigrou — all major banks that received bailout money. On average, they donated twice as much to Obama than McCain, but amazingly still funded both sides.

I don’t like to believe in conspiracies — they are self-fulfilling and rely on the believer’s imaginations to be actualized.

This, however, is no case of self-indulging delusion. These are facts.

We elected a candidate on the platform of “change,” and yet all we see is more corruption than ever. When will we be delivered?

A charismatic fa/ade does its best to blind onlookers from the truth: Why should Obama spit in the faces of the banks that helped “elect” him?

I’d like to hope all is not yet lost. Can our political Messiah can still redeem himself and crucify the banks, or will he continue to be the puppet of Big Money like Bush was?

Alex Stephens is a senior political science major. His column appears Fridays in the Collegian. Letters and feedback can be sent to letters@collegian.com.

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