Enough is Enough

By Vicky Davis

As a result of such ‘manufactured pressure and support’, the USCSI and USTR negotiators developed ‘a symbiotic relationship’.3 The USCSI would raise the necessary support on Capitol Hill, in return for privileged access to the trade policy-making process through the formal Industry Sectoral Advisory Committee on Services (ISAC 13)4 and through a profusion of informal consultations, strategy sessions, seminars and conferences.

There is ample proof that this attack on our economy was engineered.   Earlier this year, I watched an economist named Robert Lawrence give a presentation at the Peterson Institute for International Economics.  The speech was about a report he had written titled, 'Blue Collar Blues: Is Trade to Blame for Rising US Income Inequality'.  In that speech, he mentioned one critical piece of evidence to the engineering of this attack on our economy.  In 1992, U.S. tax law was changed.  The tax treatment for CEO stock options were changed to be treated as ordinary income rather than having the special tax treatment they'd had in the past.  That struck a chord with me because I rewrote the Keyman Stock Option Grant system for Phizer Pharmaceuticals for that tax change in 1992.  Two years later, the  dot.con stock market boom started which the market experts subsequently attributed to the Netscape IPO.  I attribute it to having all the ducks lined up for nuking our economy through stock market fraud and the exporting of a significant portion of the best part of our economy - the white collar knowledge jobs. 

The significance of that tax change was in the government statistics.  White collar workers were dropping like flies but the government statistics showed wages for white collar wages staying slightly ahead of inflation.  It is my belief that the inclusion of CEO stock options as wages in a fraudulent stock market run up covered the losses of white collar workers in the government statistical reports thereby masking the economic attack. 

In the audio clips of that House Budget hearing I've referred to several times, you can hear Douglas Holtz-Eakin describe how the tax revenue budget numbers are compiled for Congress.  Congress uses those CBO numbers to appropriate the money for government spending.  You don't even have to be an accountant to figure out how the CBO tax revenue numbers were manipulated to mask the lost tax revenues for a four year stretch of time - and how an infusion of big money would mask the numbers again for another four years.  It was a very clever scheme but it's easily proven as an intentional fraud. 

During another Congressional hearing on the subprime mortgage market meltdown, a very important question was posed to one of the mortgage company CEOs that was testifying.  I sent an email out out that hearing.  The following is the text of that email:

During the 1997-98 academic year, Mr. Zoellick was the John M. Olin Professor of National Security at the U.S. Naval Academy. From 1993 through 1997, he served as an Executive Vice President at Fannie Mae, the largest housing finance investor in the U.S., with a market capitalization of about $70 billion. He was responsible for the corporation's affordable housing business, the General Counsel, regulatory and government relations, and international financial services.

 

Mr. Zoellick received the Distinguished Service Award, the Department of State's highest honor. The German government awarded him the Knight Commanders Cross for his role in developing the U.S. Strategy toward German unification and service as the senior U.S. official in the "2 plus 4" negotiations.

 

From 1985 to 1988, Mr. Zoellick served at the Department of the Treasury in various positions, including Counselor to Secretary James A. Baker, III, Executive Secretary of the Department, and Deputy Assistant Secretary for Financial Institutions Policy. Mr. Zoellick received the Alexander Hamilton Award, the Department of Treasury's highest honor.

 

He currently serves on three for-profit boards: Alliance Capital, Jones Intercable, Inc., and Said Holdings. He is also a member of Enron Corp's Advisory Council.

 

Mr. Zoellick is the Director of the Aspen Institute's Strategy Group on Foreign Policy. He is a board member of the Council of Foreign Relations, the German Marshall Fund of the U.S., the European Institute, the Eurasia Foundation, the National Bureau of Asian Research, the American Council on Germany, the American Institute for Contemporary German Studies, and the Overseas Development Council. He serves on the governing council of the International Institute for Strategic Studies in London.

 

Mr. Zoellick is a member of the Advisory Board for Johns Hopkins School of Advanced International Studies (SAIS), the Board of Advisors of the Law & Economics Center at George Mason University, the Advisory Committee of the Institute for International Economics, the Brookings Institution's Advisory Committees for the Foreign Policy and Economic Programs, the Advisory Board of the Nixon Center for Peace & Freedom, the World Wildlife Fund's Advisory Council, the U.S. Executive Committee of the Trilateral Commission, the Advisory Board of the Centre for European Reform in London, the Australian-American Leadership Foundation, the Inter-American Dialogue, and the D.C. Bar.

• First, Congress passed something called the "Community Reinvestment Act" in 1977, resulting in the creation of bureaucratic regulations designed to encourage, or even compel, financial institutions to make loans to people with lower incomes. These regulations were then amended in 1995 and 2005 to create different rules for institutions of different sizes, so that various kinds of institutions would be better able to meet the government's goals for fostering home ownership in lower income communities.
• Second, the Federal Reserve starting making loans available to the banking system at extremely low interest rates.

Mr. Zoellick was the lead State Department official in the negotiations on the North American Free Trade Agreement, the Uruguay Round, and the launch of the Asia Pacific Economic Cooperation group.

Leveraging the Resources and Expertise of the Private Sector

The action plan builds on the President's New Compact for Development. As President Bush said last week before the Inter-American Development Bank, "Most of the money for development does not come from aid. It comes from domestic investment, foreign direct investment, and, especially, from trade." The action plan, therefore, seeks to leverage private sector resources and expertise.

 

Action Plan

The action plan includes projects to facilitate investment in small business, housing, agriculture, roads, ports, airports, and information technology.

Specific examples include:

 

l Increasing investment in housing. The U.S. Treasury Department will coordinate the provision of technical assistance to Mexico's Sociedad Hipotecaria Federal (SHF) to encourage securitization of mortgages and the creation of a secondary mortgage market in Mexico. In these efforts, Treasury will draw upon experts with experience in housing finance from private financial institutions, government-sponsored agencies (like Fannie Mae, Freddie Mac, and Ginnie Mae), and the U.S. Office of Federal Housing Enterprise and Oversight (OFHEO).

 

l Investing in infrastructure for commerce. The Partnership will lead an effort to spur the participation of U.S. companies in the development of Mexican infrastructure projects including: ports, an air cargo facility, and an expansion of Mexico's internet connectivity.

For the life of me, I can't figure out why criminal stupidity is acceptable from a Harvard MBA - allowing them to steal billions - while a shoplifter can get six months in jail for their stupidity of five-finger discounts.   We claim to be a relatively moral and just country.  It's time to start acting the part instead of just marketing it.  Enough is enough.

Vicky Davis

September 25, 2008