The Keating Scandal
Posted By: McCain's poor judgment on 2008-10-06
In Reply to:
Over the weekend, John McCain's top adviser announced their plan to stop engaging in a debate over the economy and "turn the page" to more direct, personal attacks on Barack Obama.
In the middle of the worst economic crisis since the Great Depression, they want to change the subject from the central question of this election. Perhaps because the policies McCain supported these past eight years and wants to continue are pretty hard to defend.
But it's not just McCain's role in the current crisis that they're avoiding. The backward economic philosophy and culture of corruption that helped create the current crisis are looking more and more like the other major financial crisis of our time.
During the savings and loan crisis of the late ྌs and early ྖs, McCain's political favors and aggressive support for deregulation put him at the center of the fall of Lincoln Savings and Loan, one of the largest in the country. More than 23,000 investors lost their savings. Overall, the savings and loan crisis required the federal government to bail out the savings of hundreds of thousands of families and ultimately cost American taxpayers $124 billion.
Sound familiar?
In that crisis, John McCain and his political patron, Charles Keating, played central roles that ultimately landed Keating in jail for fraud and McCain in front of the Senate Ethics Committee. The McCain campaign has tried to avoid talking about the scandal, but with so many parallels to the current crisis, McCain's Keating history is relevant and voters deserve to know the facts -- and see for themselves the pattern of poor judgment by John McCain.
The point of the film and the web site is that John McCain still hasn't learned his lesson.
And this time, McCain's bankrupt economic philosophy has put our economy at the brink of collapse and put millions of Americans at risk of losing their homes.
Watch the video to see why John McCain's failed philosophy and poor judgment is a recipe for deepening the crisis:
http://my.barackobama.com/keatingvideo
It's no wonder John McCain would rather spend the last month of this election smearing Barack's character instead of talking about the top priority issue for voters.
It's long (13 minutes) but information every voter should know.
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Like JOHN MCCAIN - Keating 5 Scandal
I guess JM is a crook, too
http://www.mahalo.com/Keating_5_Scandal
Keating Five
History, it is said, is written by the victors. Or alternatively by John McCain, who has proclaimed that his role in the 1989 Keating Five corruption and racketeering scandal -- which led to the Lincoln Savings and Loan (S&L) bailout, part of the larger United States S&L crisis of the late 1980's and 1990's -- is his "asterisk." Excuse me? His asterisk? This writer begs to differ.
But apparently the American corporate media agrees, judging by its all but collective failure to report on McCain's primary role in the one incident in American history where the exact same catalyst, government deregulation, led to a comparable financial shipwreck, albeit not on the same gargantuan scale as the present, historic economic collapse.
This is not to say that the S&L crisis was not big. To the contrary, the immensity of the Lincoln Savings and Loan collapse, indeed of the entire S&L sector--and John McCain's role in it--is impossible to overstate. At this point, a bit of historical context is in order.
It all began when Charles Keating's American Continental Corporation purchased Lincoln in 1984. In the span of five years, with Keating as chairman -- and with the S&L industry newly deregulated -- Lincoln's assets ballooned from 1.1 billion to 5.5 billion. Much of this booty was the result of using customers' federally insured deposits to engage in high risk, highly speculative real estate and junk bond dealings.
By 1986, Lincoln had $135 million in undisclosed losses, and they had surpassed the newly imposed cautionary 10 percent "direct investment" limit of institutional assets by $600 million dollars. It doesn't take a financial wizard to recognize that this did not bode well for Lincoln's individual depositors -- or for the government's insurance fund, the Federal Depositor Insurance Corporation (FDIC). In 1989, the Federal Home Loan Bank Board (FHLBB), growing increasingly alarmed by Lincoln's use of FDIC-insured funds for commercial real estate deals, initiated a probe into Lincoln's free-wheeling investment practices.
Once Keating got wind of the investigation, he decided to capitalize on his political investments, his estimated $1.3 million in campaign contributions to various U. S. Senators. And John McCain, the deregulator's deregulator, was the recipient of the most cash, $112,000 -- which may not seem like much by today's standards, but it was a bundle back in the 1980's.
And that doesn't include the other fringe benefits afforded to McCain, like private jet rides to Keating's opulent Bahamas estate, myriad fund raisers for McCain's House and Senate campaigns, or Cindy McCain's (and her father's) involvement with Keating in a "sweetheart" shopping mall deal in Arizona. As the Feds closed in, Keating decided to call in his markers.
Keating orchestrated at least two April 1987 meetings between several San Francisco FHLBB board members, including its chairman Edwin Gray, and five U. S. Senators -- The Keating Five -- including the good John McCain. In spite of this blatant obstruction of justice, the San Francisco regulators found Lincoln guilty of unsound lending practices and recommended its seizure. The Keating Five exerted pressure and the takeover was delayed for 2 years. Gray was replaced. Meanwhile, Lincoln's customers were steered into extremely risky, uninsured investments, junk bonds held by Keating's American Continental Corporation, which ultimately went belly-up in April 1989. Lincoln was finally seized by the FHLBB that same month.
Meanwhile, more than 21,000 mostly elderly depositors lost their life's savings in the sordid affair, to the tune of $285 million, prompting an approximate $2 billion federal government bail-out. Keating was found guilty of fraud and racketeering and served 50 months of a 12-year prison sentence. McCain was cleared of any wrongdoing and chided for "poor judgment" by the Senate Ethics Committee.
In the two decades since this disgraceful affair, McCain has maintained that he did not knowingly do anything wrong. All the money and graft did not influence his actions.
Not so, according to Keating who is quoted in the 2003 book, Philosophical Dimensions of Public Policy. When asked if his political donations amounted to quid pro quo, Keating reportedly said "I want to say in the most forceful way I can: I certainly hope so."
No such candor from John McCain. To let the senator from Arizona tell it, he was only helping Keating because he was one of the largest employers in his state. Besides that, Keating's accountants vouched for Lincoln's financial viability. Even Alan Greenspan authored a favorable report commissioned by Keating, McCain routinely deflects. How could anyone blame him for not knowing that Keating was looting Lincoln? (This is kind of like the Bush Administration's circular defense of the massive "intelligence failure" with regard to Saddam Hussein's nonexistent weapons of mass destruction.)
At any rate, that is McCain's story, and he has been sticking to it for almost two decades now. Not that he has had to talk much about it in recent years. He has been too busy straight-talking about ethics and campaign finance reforms, not unlike the burglar who repents and becomes an anti-theft crusader. And lo and behold, so far it has worked. In perhaps the ultimate self-fulfilling prophecy, it would seem that McCain has succeeded in making The Keating Five mess his self-proclaimed asterisk. And who can blame him for trying to sanitize this most shameful chapter of his political career? But the so-called Fourth Estate's silence is another story altogether.
It is nothing less that mind-boggling that most of the media establishment, America's supposed "watchdog" is ignoring this crucial chapter of the McCain story. Really, when you think about it, it is obscene; and an objective history will judge them harshly. Particularly when one considers that this is the same media that acted as drum majors in the run-up to the Iraq War, and were enthusiastically embedded with the military in the delusional days of "shock and awe." Or were they in bed with the Bush Administration?
This is the very same media that obsessed over Bill Clinton's sexual peccadilloes and savaged AL Gore for inconsequential things like visiting a Buddhist temple or kissing his wife too passionately after his acceptance speech at the Democratic National Committee...and who barely made a sound when the Supreme Court basically overturned an American Presidential election. And it is the same media that was basically complicit in the swiftboating of the decorated Vietnam veteran, John Kerry.
The same press corps that has rendered the Democrats spineless and, for the last eight years, afraid to act as a true opposition party (and too fainthearted to raise the Keating Five in this election cycle) lest they too be savaged by the Republicans who, with a wink and a nod, constantly rail against the "liberal media" who have now apparently taken a vow of silence about John McCain's "asterisk."
In a clear-eyed, reasonable, straight-talking society, the Keating Five would be the lead of any John McCain biography, second only to the Hanoi Hilton. Some might even argue that the monumental racketeering scandal should take a back seat to nothing in the story of this man who would be president -- particularly at a time when this nation's economic infrastructure is literally crumbling. Count this writer in that number.
AIG Scandal
Part of article on AIG and what they are really doing - pretty interesting.....for full excerpt goto: http://www.truthout.org/031809R
The Real AIG Scandal
Tuesday 17 March 2009
by: Eliot Spitzer | Visit article original @ Slate Magazine
Former US Treasury Secretary Henry Paulson (pictured), then-New York Fed official Timothy Geithner, Goldman Sachs CEO Lloyd Blankfein and Fed Chairman Ben Bernanke made the initial decision to bail out AIG. (Photo: Elizabeth Dalziel / AP)
It's not the bonuses. It's that AIG's counterparties are getting paid back in full.
Everybody is rushing to condemn AIG's bonuses, but this simple scandal is obscuring the real disgrace at the insurance giant: Why are AIG's counterparties getting paid back in full, to the tune of tens of billions of taxpayer dollars?
For the answer to this question, we need to go back to the very first decision to bail out AIG, made, we are told, by then-Treasury Secretary Henry Paulson, then-New York Fed official Timothy Geithner, Goldman Sachs CEO Lloyd Blankfein, and Fed Chairman Ben Bernanke last fall. Post-Lehman's collapse, they feared a systemic failure could be triggered by AIG's inability to pay the counterparties to all the sophisticated instruments AIG had sold. And who were AIG's trading partners? No shock here: Goldman, Bank of America, Merrill Lynch, UBS, JPMorgan Chase, Morgan Stanley, Deutsche Bank, Barclays, and on it goes. So now we know for sure what we already surmised: The AIG bailout has been a way to hide an enormous second round of cash to the same group that had received TARP money already.
SURPRISE! huh? http://www.truthout.org/031809R
Two words... KEATING FIVE!! nm
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Why don't you ever mention the other 4 in the Keating 5 were....
Democrats? Three of whom were much more than "rebuked." The Keating 5 was a small part of the article. The lead with the pic of the "indicted" guy has been refuted...and Obama also has an "indicted" friend..Rezko. But you did not bring that up either.
Google and look.....for instance the Keating 5....
one of those was also Senator John Glenn of Ohio, a Democrat. Did we see HIS name prominently in the letter? People love John Glenn and NO ONE ever mentions HE was one of the Keating 5. In fact, all the other 4 were Democrats. John Glenn and John McCain were the only 2 that the senate ethics committee said were NOT centrally involved and cleared of impropriety. Both ran for re-election the next year and both were re-elected. And John McCain has apologized for any involvement, said it was poor judgment, and mentioned that again at the Saddleback interview. At least he admits when he is wrong and takes responsibility. Yet another reason I like him.
THAT is what I mean about getting the WHOLE story.
Let's talk about McCain and the Keating Five or his
Let's talk about how he left his wife who waited for him while he was in prison for five years. Then he dumped her because she was disfigured in an accident. Now he has Cindy who makes life wonderful with $100 mil a year. He needs to be president to bring something to the table for HER because his war vet thing is nice but not really as prestigious as PRES and as PRES he could do a lot for rich people like wifey.
And he's related to Charles Keating!
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Scandal? That is hilarious! Everyone Obama
nm
Bush involved in leak scandal
Source to Stephanopoulos: President Bush Directly Involved In Leak Scandal
Near the end of a round table discussion on ABC’s This Week, George Stephanopoulos dropped this bomb:
Definitely a political problem but I wonder, George Will, do you think it’s a manageable one for the White House especially if we don’t know whether Fitzgerald is going to write a report or have indictments but if he is able to show as a source close to this told me this week, that President Bush and Vice President Cheney were actually involved in some of these discussions.
This would explain why Bush http://www.salon.com/opinion/feature/2005/08/17/bush_plame/index1.html>spent more than an hour answering questions from special prosecutor Patrick Fitzgerald. It would also fundamentally change the dynamics of the scandal. President Bush could no longer claim he was merely a bystander who wants to “get to the bottom of it.” As Stephanopoulos notes, if Bush played a direct role it could make this scandal completely unmanageable.
Dyncorp & Halliburton Sex Slave Scandal
Dyncorp and Halliburton Sex Slave Scandal Won't Go Away
Halliburton, Dyncorp lobbyists stall law banning human trafficking and sex slavery
Paul Joseph Watson & Alex Jones | January 1 2006
Almost a year after Representative Cynthia McKinney was told by Donald Rumsfeld that it was not the policy of the Bush administration to reward companies that engage in human trafficking with government contracts, the scandal continues to sweep up innocent children who are sold into a life of slavery at the behest of Halliburton subsidiaries , Dyncorp and other transnational corporations with close ties to the establishment elite.
On March 11th 2005, McKinney grilled Secretary Rumsfeld and General Myers on the Dyncorp scandal.
Mr. Secretary, I watched President Bush deliver a moving speech at the United Nations in September 2003, in which he mentioned the crisis of the sex trade. The President called for the punishment of those involved in this horrible business. But at the very moment of that speech, DynCorp was exposed for having been involved in the buying and selling of young women and children. While all of this was going on, DynCorp kept the Pentagon contract to administer the smallpox and anthrax vaccines, and is now working on a plague vaccine through the Joint Vaccine Acquisition Program. Mr. Secretary, is it [the] policy of the U.S. Government to reward companies that traffic in women and little girls?
The response and McKinney's comeback was as follows.
Rumsfeld: Thank you, Representative. First, the answer to your first question is, is, no, absolutely not, the policy of the United States Government is clear, unambiguous, and opposed to the activities that you described. The second question.
McKinney: Well how do you explain the fact that DynCorp and its successor companies have received and continue to receive government contracts?
Rumsfeld: I would have to go and find the facts, but there are laws and rules and regulations with respect to government contracts, and there are times that corporations do things they should not do, in which case they tend to be suspended for some period; there are times then that the - under the laws and the rules and regulations for the - passed by the Congress and implemented by the Executive branch - that corporations can get off of - out of the penalty box if you will, and be permitted to engage in contracts with the government. They're generally not barred in perpetuity.
McKinney: This contract - this company - was never in the penalty box.
Rumsfeld: I'm advised by DR. Chu that it was not the corporation that was engaged in the activities you characterized but I'm told it was an employee of the corporation, and it was some years ago in the Balkans that that took place.
Watch the video here.
Rumsfeld's effort to shift the blame away from the hierarchy at Dyncorp and onto the Dyncorp employees was a blatant attempt to hide the fact that human trafficking and sex slavery is a practice condoned by companies like Dyncorp and Halliburton subsidiaries like KBR.
What else are we to assume in light of recent revelations cited in the Chicago Tribune that Halliburton subsidiary KBR and Dyncorp lobbyists are working in tandem with the Pentagon to stall legislation that would specifically ban trafficking in humans for forced labor and prostitution by U.S. contractors?
Three years has now elapsed since President Bush's promise to bring an end to this disgrace and the Pentagon is still yet to actually bar the practice.
And the employees themselves that are burned for blowing the whistle, like Kathryn Bolkovac who was sacked for reporting on Dyncorp officials who were involved in the Bosnian sex trade.
Illinois Governor Rod Blagojevich is one of very few representatives in high office aside from Cynthia McKinney to demand answers on this issue.
We applaud Blagojevich's eforts. The iron curtain of official denial and soft-peddling is falling down.
What has happened to the children who were sold into slavery and forced to satisfy the demands of sick pedophiles working on behalf of the US government?
Where were the investigations and convictions in other cases of establishment orchestrated child slavery and prostitution? Like the NATO officials responsible for the mushrooming of child prostitution in Kosovo?
What happened to UN officials identified as using a ship charted for 'peacekeepers' to bring young girls from Thailand to East Timor as prostitutes?
In addition, we received an E mail from a person claiming to be a Dyncorp employee stating that a high level Dyncorp official is breaking the law by accepting payment from the US government and in turn the American taxpayer by falsifying timesheets and claiming pay for hours not worked.
The contact states that this was repeatedly brought to the attention of DynCorp program managers by Dyncorp employees but they were told it was none of their business.
It is important to stress that at the moment these are allegations and we have no proof of this other than the validity of the e mail.
The e mail is a reminder that we should always consider the fact that the vast majority of Dyncorp employees are just doing their jobs and have nothing to do with this scandal. It is a small faction at the head of the hydra that have authorized and engaged in these horrors.
We have a government that says it doesn't advocate torture and yet tries to block a law that would end torture. We have a government that repeatedly burns lower level minions to wash its hands of every major scandal that encompasses policies directly administered by the government itself, as in the case of Abu Ghraib and the Dyncorp sex scandal.
A government that covers-up for those who force children into prostitution and slavery is a clear danger to our very way of life.
We must demand answers and finally put an end to a process that exploits and wreaks terror on the lives of the most innocent and vulnerable members of society, whether they be in the Balkans, East Timor or here at home.
Our own children.
Ummm....what about that whole Iran-Contra Scandal...LOL (nm)
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Financial crisis a democratic scandal....sm
http://www.floppingaces.net/2008/09/16/financial-crisis-a-democrat-scandal/
Read all the comments underneath this, if you have time.
Keating 5 cost taxpayers $125 billion.
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McCain has spoke ad nauseam about Keating 5
Get over it already!
The corrupt ACORN bunch are still at it and Obama is backing them every inch of the way. They are his push into office don't ya know?
Emanuel Was Director of Freddie Mac During Scandal...
http://www.abcnews.go.com/Blotter/story?id=6201900&page=1
Emanuel Was Director Of Freddie Mac During Scandal
New Obama Chief of Staff, Others on Board, Missed "Red Flags" of Alleged Fraud Scheme
By BRIAN ROSS and RHONDA SCHWARTZ
November 7, 2008
President-elect Barack Obama's newly appointed chief of staff, Rahm Emanuel, served on the board of directors of the federal mortgage firm Freddie Mac at a time when scandal was brewing at the troubled agency and the board failed to spot "red flags," according to government reports reviewed by ABCNews.com.
According to a complaint later filed by the Securities and Exchange Commission, Freddie Mac, known formally as the Federal Home Loan Mortgage Corporation, misreported profits by billions of dollars in order to deceive investors between the years 2000 and 2002.
Emanuel was not named in the SEC complaint (click here to read) but the entire board was later accused by the Office of Federal Housing Enterprise Oversight (OFHEO) (click here to read) of having "failed in its duty to follow up on matters brought to its attention."
In a statement to ABCNews.com, a spokesperson said Emanuel served on the board for "13 months-a relatively short period of time."
The spokesperson said that while on the board, Emanuel "believed that Freddie Mac needed to address concerns raised by Congressional critics."
Freddie Mac agreed to pay a $50 million penalty in 2007 to settle the SEC complaint and four top executives of the Federal Home Loan Mortgage Corporation were charged with negligent conduct and, like the company, agreed to settle the case without admitting or denying the allegations.
The actions by Freddie Mac are cited by some economists as the beginning of the country's economic meltdown.
The federal government this year was forced to take over Freddie Mac and a sister federal mortgage agency, Fannie Mae, pledging at least $200 billion in public funds.
Freddie Mac records have been subpoenaed by the Justice Department as part of its investigation of the suspect accounting procedures.
Emanuel was named to the Freddie Mac board by President Bill Clinton in 2000 and resigned his position when he ran for Congress in May, 2001.
Freddie Mac Misrepresented Income, Says SEC
During the years 2000, 2001 and 2002, according to the SEC, Freddie Mac substantially misrepresented its income to "present investors with the image of a company that would continue to generate predictable and growing earnings."
The role of the 18-member board of directors, including Emanuel, was not addressed in the SEC's public action but was heavily criticized by the oversight group (OFHEO) in 2003.
The oversight report said the board had been apprised of the suspect accounting tactics but "failed to make reasonable inquiries of management."
The report also said board members appointed by the President, such as Emanuel, serve terms that are far too short "for them to play a meaningful role on the Board."
As a Congressman, Emanuel recused himself from any votes dealing with Freddie Mac until just this year.
In dealing with the nation's economic crisis, the new White House chief of staff will almost certainly be involved in discussions about the house and mortgage markets.
Emanuel's spokesperson said, "As White House chief of staff he will work with President-elect Obama and his economic advisers to help ensure we protect taxpayers and homeowners."
You have to excuse them, after Bill and Hill, scandal is just part
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You call Keating, Ayers, ACORN et all serious debate?
I don't. How about the economy, the wars, the exploding national debt, unemployment, homelessness. That's the issues I'd like to see discussed and your proposed solutions, not who can sling the most mud. Get it?
Senate scandal snares Obama Chief Aide...
http://www.timesonline.co.uk/tol/news/world/us_and_americas/article5337807.ece
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