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Jun 25th
Home Columns Op-Ed Page Media Must Tell the Truth about the Democrats' Role in the Current Economic Crisis
Media Must Tell the Truth about the Democrats' Role in the Current Economic Crisis PDF Print E-mail
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Columns - Op-Ed Page
Sunday, 02 November 2008 13:35

Pooled Editorial (as reissued on Dec. 15, 2008)


T his online publication adopts the open letter of Orson Scott Card as a pooled editorial. We share Mr. Card’s sentiments one-hundred percent. He is telling the truth and the American mainstream media are not listening to the truth, as presented by Mr. Card. The open letter is entitled, “Would the Last Honest Reporter Please Turn ON the Lights?”

We are republishing this pooled editorial in view of the latest financial scandal in Wall Street, as written by Peter Cohan. Here is what he wrote: "But Madoff's scam (the $50-billion Madoff Securities scandal) also benefited from a hands-off policy towards Wall Street thanks to help from politicians such as Chuck Schumer (D-NY) who raised millions from Wall Street to do its bidding. As head of the Democratic Senatorial Campaign Committee between 2004 and 2008, he raised $240 million while increasing donations from Wall Street by 50%. In return Wall Street got free-market, deregulatory policies that helped them cook up the scandals that have helped wipe out $30 trillion in global stock market value in the last year" -- as reprinted from: “It takes a village to pull off a $50 billion investment scam” by Peter Cohan. Mr. Cohan's report is reprinted at the end of this article.


Here is, therefore, the pooled editorial:


Would the Last Honest Reporter Please Turn ON the Lights?
By Orson Scott Card

Editor's note: Orson Scott Card is a Democrat and a newspaper columnist, and in this opinion piece he takes on both, while lamenting the current state of journalism.

An open letter to the local daily paper — almost every local daily paper in America:

I remember reading 'All the President's Men' and thinking: That's journalism!  You do what it takes to get the truth, and you lay it before the public, because the public has a right to know.

This housing crisis didn't come out of nowhere.  It was not a vague emanation of the evil Bush administration.  It was a direct result of the political decision, back in the late 1990s, to loosen the rules of lending, so that home loans would be more accessible to poor people.  Fannie Mae and Freddie Mac were authorized to approve risky loans.  What is a risky loan? It's a loan that the recipient is likely 'not' to be able to repay.

The goal of this rule change was to help the poor — which especially would help members of minority groups.  But how does it help these people, to give them a loan that they can't repay? They get into a house, yes, but when they can't make the payments, they lose the house — along with their credit rating.  They end up worse off than before.

This was completely foreseeable, and in fact, many people 'did' foresee it.  One political party, in Congress, and in the executive branch, tried repeatedly to tighten up the rules.  The other party blocked every such attempt, and tried to loosen them.  Furthermore, Freddie Mac and Fannie Mae were making political contributions to the very members of Congress who were allowing them to make irresponsible loans.  Though why quasi-federal agencies were allowed to do so baffles me.  (It's the same as if the Pentagon were allowed to contribute to the political campaigns of Congressmen who support increasing their budget.)


The media have to tell the truth about the Democrats, including Barack Obama — and do so with the same energy they would use if the miscreants were Republicans.

     Isn't there a story here?  Doesn't journalism require that you, who produce our daily paper, tell the truth about 'who' brought us to a position, where the only way to keep confidence in our economy was a $700 billion bailout?  Aren't you supposed to follow the money, and see which politicians were benefiting personally from the deregulation of mortgage lending?

I have no doubt that if these facts had pointed to the Republican Party, or to John McCain, as the guilty parties, you would be treating it as a vast scandal.  "Housing-gate", no doubt. Or "Fannie-gate".

Instead, it was Senator Christopher Dodd and Congressman Barney Frank, both Democrats, who denied that there were any problems; who refused Bush administration requests to set up a regulatory agency to watch over Fannie Mae and Freddie Mac; and who were still pushing for these agencies to go even further in promoting sub-prime mortgage loans, almost up to the minute they failed.

As Thomas Sowell points out in a essay entitled, "Do Facts Matter?" ( ): "Alan Greenspan warned them four years ago.  So did the Chairman of the Council of Economic Advisers to the President.  So did Bush's Secretary of the Treasury."  These are facts.


This financial crisis was completely preventable. The party that blocked any attempt to prevent it was ... the Democrat Party. The party that tried to prevent it was ... the Republican Party.  Yet, when Nancy Pelosi accused the Bush administration and Republican deregulation of causing the crisis, you in the press did not hold her to account for her lie.  Instead, you criticized Republicans, who took offense at this lie and refused to vote for the bailout!


Editor’s Note: Please read also the articles about the same findings
that were printed in the MabuhayRadio website:


People Must Blame Greed, Sen. Obama and Themselves Instead of Blaming Mr. Bush for Mortgage Meltdown


Democrats Equally to Blame for Sad State of American Economy


American Economy Not As Bad as It Looks: U.S. Congress Must Share Blame, If Any, with President Bush


What?  It's not the liar, but the 'victims' of the lie, who are to blame?

Now let's follow the money ... right to the presidential candidate who is the number-two recipient of campaign contributions from Fannie Mae.

And after Raines, the CEO of Fannie Mae, who made $90 million while running it into the ground and was fired for his incompetence, one presidential candidate's campaign actually consulted him for advice on housing.

If that presidential candidate had been John McCain, you would have called it a major scandal, and we would be getting stories in your paper every day about how incompetent and corrupt he was.  But instead, that candidate was Barack Obama, so you have buried this story, and when the McCain campaign dared to call Raines an "adviser" to the Obama campaign — because that campaign 'had' sought his advice — you actually let Obama's people get away with accusing McCain of lying, merely because Raines wasn't listed as an 'official' adviser to the Obama campaign.

You would never tolerate such weasely (sic) nit-picking from a Republican.
If you (who produce our local daily paper) actually had any principles, you would be pounding this story, because the prosperity of all Americans was put at risk by the foolish, short-sighted, politically selfish (and possibly corrupt) actions of leading Democrats, including Obama.

If you (who produce our local daily paper) had any personal honor, you would find it unbearable to let the American people believe that somehow Republicans were to blame for this crisis.

There are precedents.  Even though President Bush and his administration never said that Iraq sponsored or was linked to 9/11, you could not stand the fact that Americans had that misapprehension — so you pounded us with the fact that there was no such link.  (Along the way 'you' created the false impression that Bush had lied to them, and said that there was a connection.)


If you had any principles, then surely, right now, when the American people are set to blame President Bush and John McCain for a crisis they tried to prevent, and are actually shifting to approve of Barack Obama because of a crisis he helped cause, you would be laboring at least as hard to correct 'that' false impression.

Your job, as journalists, is to tell the truth. That's what you claim you do, when you accept people's money to buy or subscribe to your paper.  But right now, you are consenting to, or actively promoting a big fat lie — that the housing crisis should somehow be blamed on Bush, McCain, and the Republicans. You have trained the American people to blame everything bad — even bad weather — on Bush, and they are responding as you have taught them.

If you had any personal honor, each reporter and editor would be insisting on telling the truth — even if it hurts the election chances of your favorite candidate.  Because that's what honorable people do. Honest people tell the truth, even when they don't like the probable consequences. That's what honesty 'means'.  That's how trust is earned.

Barack Obama is just another politician, and not a very wise one.  He has revealed his ignorance and naïveté time after time — and you  have swept it under the rug, treated it as nothing.  Meanwhile, you have participated in the borking (sic) of Sarah Palin, reporting savage attacks on her, for the pregnancy of her unmarried daughter — while you ignored the story of John Edwards's 'own' adultery for many months.  So I ask you now: Do you have any standards at all?  Do you even know what honesty means?  Is getting people to vote for Barack Obama so important, that you will throw away everything that journalism is supposed to stand for?

You might want to remember the way the National Organization of Women threw away 'their' integrity by supporting Bill Clinton, despite his well-known pattern of sexual exploitation of powerless women.  Who listens to NOW anymore?  We know they stand for nothing; they have no principles.  That's where you are right now.  It's not too late. You know that if the situation were reversed, and the truth would damage McCain and help Obama, you would be moving heaven and earth to get the true story out there.

If you want to redeem your honor, you will swallow hard, and make a list of all the stories you would print if it were McCain who had been getting money from Fannie Mae, McCain whose campaign had consulted with its discredited former CEO, McCain who had voted against tightening its lending practices.  Then you will print them, even though every one of those true stories will point the finger of blame at the reckless Democrat Party, which put our nation's prosperity at risk, so they could feel good about helping the poor, and lay a fair share of the blame at Obama's door.  You will also tell the truth about John McCain: that he tried, as a Senator, to do what it took to prevent this crisis. You will tell the truth about President Bush: that his administration tried more than once to get Congress to regulate lending in a responsible way.

This was a Congress-caused crisis, beginning during the Clinton administration, with Democrats leading the way into the crisis, and blocking every effort to get out of it in a timely fashion. If you (at our local daily newspaper) continue to let Americans believe — and vote as if — President Bush and the Republicans caused the crisis, then you are joining in that lie.  If you do not tell the truth about the Democrats — including Barack Obama — and do so with the same energy you would use if the miscreants were Republicans — then you are not journalists by 'any' standard.  You're just the public relations machine of the Democrat Party, and it's time you were all fired and 'real' journalists brought in, so that we can actually have a 'news' paper in our city.  # # #

Editor’s Note: This article first appeared in The Rhinoceros Times of Greensboro, North Carolina, and is used according to the journalistic practice of doing pooled editorials. Its URL

 Click here.


It can be accessed also in this link 

Would the Last Honest Reporter Please Turn On the Lights


Due to the popularity of this article on the Rhinoceros Times, it has been moved to a static HTML format. After reading this article, if you would like to ...


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* * * * *

It takes a village to pull off a $50 billion investment scam

Posted Dec 14th 2008 9:15AM by Peter Cohan

Filed under: Market matters, Scandals, Money and Finance Today, Personal finance, Politics, Financial Crisis


To paraphrase our next Secretary of State, it takes a village to keep an investment scam going. It takes an entrepreneur who's hungry, amoral, and clever; investors eager to believe that what's too good to be true is real; auditors who get paid not to audit; politicians who take money to keep regulation away; and regulators who do what the politicians tell them to do.


All these factors were in play with the $50 billion Madoff Securities scandal. As I posted, Bernie Madoff was able to scam investors by creating false financial statements and using a tiny, unknown auditor to persuade investors hungry for membership in his club that they could get regular 10% annual returns in any market.


But Madoff's scam also benefited from a hands-off policy towards Wall Street thanks to help from politicians such as Chuck Schumer (D-NY) who raised millions from Wall Street to do its bidding. As head of the Democratic Senatorial Campaign Committee between 2004 and 2008, he raised $240 million while increasing donations from Wall Street by 50%. In return Wall Street got free-market, deregulatory policies that helped them cook up the scandals that have helped wipe out $30 trillion in global stock market value in the last year.


And the SEC, which could have audited Madoff in September 2006 when it registered there, complied with Wall Street's wishes. Its defense is that it lacked the people to do the job -- claiming its investigations staff has dropped from 880 in fiscal 2006 to 796 in the fiscal year ending in September 2009.


The SEC could have nailed Madoff in 1992 when he was named in an SEC lawsuit brought against two Florida accountants, whom it accused of raising $441 million while selling unregistered securities -- money that Madoff managed. But Madoff claimed he did not know the money was illegally raised.


People forget about such scandals in a bull market -- but in the past eight years, that bull was a mirage floating on a sea of debt. In order to get investors back into the market, the next president will need to restore confidence in the system. And to do that he'll need to run the village differently. How so? Now we have a system where the politicians need money from the industry to get elected so they do the bidding of their paymasters -- so do regulators and auditors.


To fix this, the president will need to devise a way to pay the people who protect the public from scams that is independent of the industry they are supposed to regulate. The solution is to use money raised from many taxpayers so that no organized group -- such as industry lobbyists -- can exercise the power of its cash to dominate a politician's agenda.


But as I posted, the key to protecting the public is to create an independent group that produces the financial statements of all organizations that seek money from the public. As long as investment managers and companies produce their own report cards, we'll have investment scams.


Changing that one part of the system could create a village that would squelch any investment scam before it got off the ground.


Peter Cohan is president of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter.


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Last Updated on Monday, 15 December 2008 03:15
Comments (1)
1 Wednesday, 14 July 2010 13:19
Houses are not cheap and not everybody can buy it. However, loans was created to support people in such situations.

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