Today's Stories

September 15, 2009

Mike Whitney
The Real Lesson of Lehman's Fall

Marshall Auerback
Government Spending is the Solution--Not the Problem

Afshin Rattansi
The Deal That Led to the Srebrenica Massacre: Former UN Spokeswoman Fingers Holbrooke and the Clinton Administration

Jonathan Cook
How US Tax Breaks Fund Israeli Settlers

Gareth Porter:
Niger Redux? IAEA Conceals Evidence Iran Nuke Docs Were Forged

Dave Lindorff
Congress Needs More Catcalls

Winslow T. Wheeler
Obama and Pentagon Pork

Franklin Spinney
Bin Laden's Latest Message and the Nuttiness of the War on Terror

Karen Korenoski /
Michael Yates
Up in Wood Smoke: Boulder's Dirty Little Secret

David Macaray
Government Cheese

Susie Day
President Mao-bama's Little Red Primer

Website of the Day
The Cotton Pickin' Truth: the Persistance of Slavery in Mississippi

September 14, 2009

Paul Craig Roberts
The Health Care Deceit

M. G. Piety
The Danes Do It (Health Care) Better

Shamus Cooke
Wall Street Under Obama: Bigger and Riskier

Bouthaina Shaaban
Three Faces and a Homeland

Alvaro Huerta
In Defense of the Undocumented: Immigrants and Health Care

John Ross
Mexico Loses Its History

Harvey Wasserman
The Supreme Court and Corporate Money

Adam Federman
The Plight of the Bumblebee

Stephen Fleischman
The Federal Twist

Robert Jensen
Can Journalism Schools be Relevant in a World on the Brink?

Website of the Day
The Origin of Sex Offender Registries

September 11-13, 2009

Alexander Cockburn
Obama's Big Speech: Math Trumps Rhetoric

JoAnn Wypijewski
Trumka Takes Over AFL-CIO

Carl Ginsburg
The Patient as Profit Center

Leonard Peltier
I am Barack Obama's Political Prisoner Now

Franklin Lamb
Ted Kennedy's Changing Take on Israel

Benjamin Dangl
Throwing Bullets at Failed Policies

Mike Whitney
How to Fight Deflation

John Berger
In Search of Antonello

Saul Landau
Watergate and Modern Scandals

Russell Mokhiber
Disgraceful Democrats

Ricardo Alarcón de Quesada
Pryor's Judgment

Felice Pace
NPR's Linda Gradstein Has Done It Again on Gaza

Jordan Flaherty
The Battle Over Discriminatory Housing Laws in New Orleans

Ron Jacobs
It's Time to be Impolite About Afghanistan

David Macaray
The Utility of Boycotts

David Correia
Welcome to the Business-Friendly Carpenter's Union

Robert Bryce
Wind Turbines and Bird Kills

Christopher Brauchli
Defenders of the Classroom

Paul Krassner
Aha! A Few Words About the 9/11 Truth Movement

Charles R. Larson
Deracination

Kim Nicolini
"Extract:" An Exercise in Economic Realism

David Yearsley
Tall Buildings: the Sound and the Silence

Lorenzo Wolff
In Defense of the One Hit Wonder

Poets' Basement
McEnteer and Corseri

Website of the Weekend
Pizarchik: the Wrong Choice

September 10, 2009

Joshua Frank
Inside Hanford's B Reactor: a Tour of the World's Most Toxic Nuclear Site

Dean Baker
Bernanke's Bad Money

Brian M. Downing
The State of U.S. National Security

Franklin C. Spinney
Portrait of an Afghan Firefight: Up Close and Personal

Andy Worthington
No Escape From Guantánamo

Chase Madar
Samantha Power and the Weaponization of Human Rights

Farzana Versey
A Tale of Two Slums

Ronnie Cummins
Whole Foods, Fair Trade and Organics

Binoy Kampmark
Health Care, Obama and the System

Timothy Lebrón
The Conservative Case for Health Care Reform

Charles R. Larson
A Solution to the Health Care Dilemma

Website of the Day
The Debtor's Revolt Begins!

September 9, 2009

Richard Neville
Trigger-Happy in Afghanistan

Melissa Checker
Double Jeopardy: Carbon Offsets and Human Rights Abuses

Nadia Hijab
Settling for ... Settlements?

Robert Weissman
The Stakes at the Supreme Court

Jonathan Cook
Israeli Arabs Call for General Strike

Russell Mokhiber
Pollan, Mackey, Whole Foods and Single Payer

James Ridgeway
The Dotty Factor: Will Demented Geezers Wreck the Economy?

Richard W. Behan
Obama's Imperative in Afghanistan

James McEnteer
The Photo and the Secretary: How to Appall Robert Gates

Martha Rosenberg
Hatchery Horrors

Website of the Day
Belmondo Verité

September 8, 2009

Henry A. Giroux
The Corporate Stranglehold on Education

Stephen Soldz
Psychologist Accused of War Crimes Opposes Investigations

John Ross
Rituals of the Absurd

Jeff Leys
Health Care vs. Warfare: the Future of the Afghan War

Mike Whitney Ashcroft: Repugnant to the Constitution

Shamus Cooke
Obama's Empty Labor Day Speech

Ellen Brown
Did Lehman Brothers Fall or Was It Pushed?

Norman Solomon Men With Guns: In Kabul and Washington

Deepak Tripathi
The Axis of Evil and the Great Satan

Laray Polk
Personality Cults, Indoctrination and Inculcation

Charles R. Larson
Just Who Does He Think He Is?

Website of the Day
The President is Not a Guidance Counselor

September 7, 2009

Vicente Navarro
Obama's Mistakes in Health Care Reform

Bouthaina Shaaban
In Praise of Admiral Mullen

David Macaray
Obama's Labor Day Report Card

Paul Craig Roberts
Indefensible Nation

Jonathan Cook
Israeli Ads Warn Against Marrying Non-Jews

Conn Hallinan
Brazil Flexes Its Muscles

Walter Brasch
The Origins of Labor Day, the Unknown Holiday

Mark Weisbrot
IMF Gives Honduran Government $175 Million

Carl Finamore
China's Birthday Stimulation

C. G. Estabrook
Advance Text of Obama's Big Speech

Website of the Day
One Down, 20,000 to Go

September 4-6, 2009

Alexander Cockburn
Deeper Into the Tunnel

Carl Ginsburg
Saving New Orleans' Charity Hospital

Jonathan Cook
The Missing Link in Israeli Organ Theft?

George Wuerthner
The Unintended Consequences of Wolf Hunting

Marc Levy
The Bling They Curse and Carry

Ray McGovern
Holbrooke's Afghan Benchmark

Ricardo Alarcón de Quesada
It Happened in Miami

Joe Paff
Organizing the Mission

Gareth Porter
Taliban's Tank-Killing Bombs Came From CIA, Not Iran

Devin Beaulieu
Scaremongering About Bolivia and Islam

Anthony Papa
Why Leslie Crocker Snyder Should Not Become New York City's New DA

David Ker Thomson
Love and Dekes in Utopia

Don Fitz
The Case of the Biodevastation 7: What the Police Won't Apologize For

Lee Sustar /
S. Sepehri
The Fallout From Iran's Elections

Jim Goodman
Why Honor Organized Labor?

Wajahat Ali
Domestic Crusaders: Making Muslim American Theater

Ron Jacobs
Agitator Journalism: Remembering Ramparts

Helen Redmond
The Lion Sleeps Tonight: the Crimes and Misdemeanors of Teddy Kennedy

John V. Walsh
Obama to Cindy Sheehan: Get Lost

Charles R. Larson
Mandanipour's Masterpiece: Censoring an Iranian Love Story

Mark Scaramella
Ho-Bleeping-Hum: a Few Well-Chosen Words About Valerie Plame's Book

David Yearsley
Cameron Carpenter's Amazing Organ Transplants

Ben Sonnenberg
Hooking, Breaking Friendships, Cross-Dressing and, Above All, Delphine Seyrig

Poets' Basement
Davies, Orloski and Bready

Website of the Weekend
Architectural Semiotics with Glenn Beck

September 3, 2009

Marcus Rediker
Inside Auburn Prison

Ron Jacobs
Embedded With the Taliban

Mike Whitney
How Bad Will It Get?

Ricardo Alarcón de Quesada
Untold Story of the Cuban Five: Indictment À La Carte

Saul Landau
Moby Dick and Asian Typhoons

Anat Matar
Israeli Academics Must Pay a Price to End Occupation

Tanya Golash-Boza
How Immigration Enforcement is Weakening National Security

Dave Lindorff
Which Side Are You On?

Andy Worthington
The Story of Gitmo's Two Syrians

Website of the Day
Plundering Appalachia

September 2, 2009

John Ross
Mexico's Plagues

Vijay Prashad
Hey Ram, the Things the Financial Times Group Does!

Rev. Jim Rigby
Why is Universal Health Care "Un-American"?

Joanne Mariner
What the Inspector General Found

Missy Beattie
Hejira: At Martha's Vineyard with Cindy Sheehan

Soren Ambrose
Multilateral Money

Diane Farsetta
Water: the Newest Wave of Corporate "Social Responsibility"

Nadia Hijab
Mulling Mullen's Message

Shamus Cooke
How to Lower the Deficit Without Killing Social Security

Charles R. Larson
Is Dick Cheney Running Scared?

Website of the Day
Inside the Egg Hatchery

September 1, 2009

Jeffrey St. Clair
The Wolf at Trout Creek

Paul Craig Roberts
Why Not Sanctions for Israel?

Mark T. Harris
The Whole Foods Boycott: It's About More Than CEO Hypocrisy

Dean Baker
Bank Profits Are Up: Did You Hear Anyone Say, "Thank You"?

Jeffrey Buchanan
Ending the Human Rights Crisis in KatrinaRitaVille

Robin Mittenthal
A Sea of Monocrops: Old MacDonald Never Had a Farm Like This

Ellen Brown
Mercury Mischief

Martha Rosenberg
Vytorin Marketing is Back

Website of the Day
Crazy Town Hall Protester Interviews

August 31, 2009

Pam Martens
Madoff and the SEC's Revolving Door

Anthony DiMaggio
What Obama Isn't Telling You About Afghanistan

Bouthaina Shaaban
Israeli Bodysnatchers

Ray McGovern
The Press and Torture: Covering for Cheney?

Joseph Shansky
Scenes of Resistance in Honduras

Greg Moses
The Dying Dillos of Austin

Brian McKenna
Pig Sacrifice and Swine Flu Panic

David Macaray
The Tender Trap

Brenda Norrell
Uranium Mining in the Grand Canyon

Paul Craig Roberts
The Environment Loses a Champion

Beth Sherouse
Why I'm Going to the Big Gay March in Washington

Website of the Day
The Failure of the Left Antiwar Movement

August 28-30, 2009

Alexander Cockburn
Teddy Kennedy the Hollow Champion

Joshua Frank /
Jeffrey St. Clair
From the Ledge to the Edge: How Tre Arrow Became America's Most Wanted Environmental "Terrorist"

Steve Early
Kennedy's Sins Against Labor

Michael Hudson
Learning About Financialization the Hard Way

Carl Ginsburg
Bernanke in Obamatime

Saul Landau
The Nuclear Gang Rides Again

Dave Marsh
Trapped Again: Michael Jackson's Crossover Dream

Mike Whitney
Band-Aids for the Recession

Dave Lindorff
Obama's War

José Pertierra
A Decision in the Posada Case

Joe Bageant
Obama's Fake Fight for Reform

Ricardo Alarcón de Quesada
Spies Without Espionage

Lee Sustar
On Strike for Health Care Justice

David Ker Thomson
Life in the 'Shed

David Rosen
The Silent Slaughter: Sex Wars and Nation-Building in Iraq

Alison Weir
Israeli Organ Harvesting

Ron Jacobs
Will There be Free Speech in Pittsburgh?

David Swanson
Bush Tortured

Udi Aloni
An Appeal to Israeli Filmmakers

Charles R. Larson
Children During Wartime

Kim Nicolini
District 9: Science Fiction of the Now

David Yearsley
The Wagner Cult in Seattle

Lorenzo Wolff
Riding the Rails with King Curtis

Poets' Basement
Three Poems by Marc Beaudin

Website of the Weekend
The Hidden History of Katrina

August 27, 2009

Andrea Peacock
Bearly Making It: How Many Biologists Does It Take to Count a Dead Grizzly?

Ricardo Alarcón de Quesada
Incapacitating the Cuban Five

Ray McGovern
Closing in on the Torturers

Gideon Levy
The Last Refuge: Neve Gordon and the Boycott of Israel

Shamus Cook
World Bankers Agree: the Recession is Over ... Maybe

Norman Solomon
The Afghanistan Gap

Marshall Auerbach
We Already Have a Public Option

Benjamin Dangl
Reclaiming a Continent

Kathryn Gray
The Water Privateers

David Macaray
Please Buy Our Beer (And Join Our Union)

Website of the Day
Stop the Privatization of Ocean Fisheries

August 26, 2009

Gareth Porter
The Leaking Game: Planted News Stories About Iran and Nuclear Weapons

Dave Lindorff
Getting Away With Torture: Holder's Limited, Modified Hangout

Dean Baker
The Reappointment of Bernanke

Laura Carlsen
The Coup and Honduran Women

Paul Craig Roberts
When the Government Comes First

Laura Raymond /
Bill Quigley
Haiti One Year After the Hurricane

Jordan Flaherty
Still Homeless, Still Struggling in New Orleans

Jonathan Cook
The Long Struggle to Reclaim Beersheva's Great Mosque

Robert Bryce
Bamboozled About Energy

Danny Weil
The Future of Charter Schools

Cindy Sheehan
Farewell, Senator Kennedy

John V. Walsh
Cindy Sheehan's Lonely Vigil in Obamaland

Website of the Day
The President's Laugh Line

August 25, 2009

Gabriel Kolko
Israel: A Stalemated Action of History

Danny Weil
The Charter School Hype and How It's Managed

Martine Bulard
China's Wild West

Ricardo Alarcón de Quesada
The Cuban Five: The Face of Impunity

Bélen Fernández
Why Didn't the Leopard Eat Tom Friedman?

August 24, 2009

Danny Weil
Obama and Duncan's Education Policy: Like Bush's, Only Worse

Neve Gordon
Stopping the Apartheid State
Boycott Israel

John Ross
Mexico's Supreme Court Tosses a Bombshell into Chiapas

Open Letter to Kenneth Roth
Why Has Human Rights Watch Fallen Silent on Honduras?

Dan Bacher
A Burston-Marsteller Greenwash:
Westlands Hoards Surplus Water While Farmers Suffer

August 21-23, 2009

Alexander Cockburn
The Right Wing's Prince of Gonzo

Patrick Cockburn
The Truth About Afghan Election

Ray McGovern
Unwritten CIA Death Contract Awarded to Blackwater

Carl Ginsburg
Paycheck President

Dave Lindorff
American Justice is Not Blind, But it is Truly Sick

M. Shahid Alam
An "Abnormal" Nationalism

Ron Jacobs
The Continuing Story of Camp Ashraf

Eric Walberg
Russia/Georgia/U.S. One Year Later
Who Came Out Ahead

No War on the Moon!
In Defense of the Dark Side of the Moon

Gilad Atzmon
The Hostage Dream: Loving Oneself at the Expense of Another

Crawdad Nelson
What It's Like to Die

David Yearsley
Why I Chose to Play Scarlatti on Bainbridge Island

Justin Frew
Grim Times for Irish Travelers

Website of the Day
Picket Whole Foods Friday!

August 20, 2009

Eugenia Tsao
Inside the DSM:
The Drug Barons' Campaign to Make Us All Crazy

Dave Lindorff
The Worst and the Best Thing to Happen to the Democratic Party in Years

Yonatan Preminger
The Strategy Behind Israel's Migrant Labor Policies

Wajahat Ali
The Detention of Shah Rukh Kahn

Website of the Day
How to cope with flu pandemics

August 19, 2009

David Michael Green
Guess What? He's a Terrible President

Paul Craig Roberts
Americans: Serfs Ruled by Oligarchs

Marshall Auerback
Debt Revolt? Tax Strike? There are a Lot of Angry People Out There

Franklin Lamb
AIPAC Sends in the Clowns

John Ross
Three Amigos Summit

Marjorie Cohn
Legendary Lawyer Doris Brin Walker Dies; Represented Angela Davis, Smith Act Defendants

August 18, 2009

Michael Hudson
The Specter of Debt Revolt Is Haunting Europe?

Mary Lynn Cramer
Obama-Fraud: Don't Confuse Medicare with Single-Payer

Jonathan Cook
U.S. Turns Blind Eye to Israel's New Separation Policy

Uri Avnery
Whose Acre?

Ralph Nader
Block Obama's Abject Surrender to Insurance and Drug Companies

Bill Quigley & Davida Finger
Katrina Pain Index - 2009

August 17, 2009

Ray McGovern
Can the Washington Post Save Dick Cheney?

Andy Worthington
Bagram Isn't the New Guantánamo, It's the Old Guantánamo

Patrick Cockburn
Life and Death in Baghdad as Americans Leave

Don Fitz
The True Story of Fox's Hero, Kenneth Gladney

P. Sainath
Drought of Justice, Flood of Funds

Helena Cobban
Zionist Pioneer Renounces Zionism

August 14-16, 2009

Alexander Cockburn
Health Plans and Death Plans

Jeffrey St. Clair
The Fall of the House of Stanford

Peter Linebaugh
The Commons, the Castle, the Witch and the Lynx

Esam Al-Amin
What Actually Happened in Fatah's Elections?

Marshall Auerback
Why a Debtor's Revolt Would Work

Mike Whitney
Bulletins From Clunkerville

Paul Krassner
Woodstock at Forty

Saul Landau
Health Care and the Seeds of Disunity

Nikolas Kozloff
Colombian Elites Fear Bolivaran Revolution

Henry A. Giroux
Politics After Hope

John Ross
Sleepwalking Through the Minefield

Jonathan Cook
Israeli Land Sale

Isabella Kenfield
Monsanto's Man in the Obama Administration

David Rosen
Sexual Torture, Yet Again

Ron Jacobs
Unconditional Negotiations, Now!

Wajahat Ali
Obama's Immigration Reforms: Neither Humane Nor Thoughtful

David Macaray
Prison Games

Greg Moses
Down in South Texas: the Geometries of Bob Dylan

Charles R. Larson
Egyptian Economics 101

David Yearsley
Stalked by Bill Evans' Ghost: Kind of Blue at Fifty

Lorenzo Wolff
There Ain't Much to Country Livin': the Drive-By Truckers and the Fine Print

Kim Nicolini
Class, Race and Clint

Poets' Basement
Reiss, Ford and Moser

Website of the Weekend
Timidity and Transparency

August 13, 2009

Eduardo Galeano
I Hate to Bother You

Joanne Mariner
Letting Cheney Off the Hook

Michael Donnelly
Burning Forests for Electricity

Norman Solomon
When the Dead Have No Say

Russell Mokhiber
Boycott Whole Foods

Tim Wise
Sick Heil! The Hitlerizing of Obama

Brian M. Downing
Succession and the Pakistani Taliban

Dave Lindorff
Single-Payer and Medicare

David Manning / Miriam Cotton:
Iran Versus Honduras: a Subtle Difference

Martha Rosenberg
John Hughes, Gone With Only 59 Candles

Website of the Day
Congress Can't Find Their As-teroids

August 12, 2009

Michael J. Watts
Nigeria on the Brink

Bouthaina Shaaban
Where are the Arabs to Stand Up for the Hanoun and Ghawi Families?

Ricardo Alarcón
The Cuban Five: Justice in Wonderland

Binoy Kampmark
Terror Australis

Paul Craig Roberts
Concocting the Appearance of Recovery

Alan Farago
Going Down Absurd: the Future of Florida Bay

James Ridgeway
Ghostwriting Your Meds

Dave Lindorff
10 Questions to Ask If You Find Yourself at an ObamaCare Town Hall Meeting

David Macaray
Labor and the Conventional Wisdom

Niranjan Ramakrishnan
The Assimilation of Niranjan Ramakrishnan

Website of the Day
A Petition in Support of Janice Harper

August 11, 2009

Ricardo Alarcón
Forbidden Heroes

Marshall Auerback
America's Biggest Economic Problem?

Reza Yavari
Inside Iran's Most Infamous Prison

Winslow T. Wheeler
How Congress Pays For Its Pork

Tim Wise
Red-Baiting and Racism

Uri Avnery
A Moral Person

Deepak Tripathi
Getting Away With Torture

Greg Moses
Time to Plan for the Worst

Benjamin Dangl
Boycotting Big Beer

Dave Lindorff
Hecklers Unite! Why Aren't Progressives Disrupting ObamaCare Town Halls?

Website of the Day
What Bush Told Chirac About the Iraq War

August 10, 2009

David Price
Trial by FBI Investigation

Mike Whitney
There is No Recession; It's a Planned Demolition

Alan Farago
Seeds of Destruction: How the National Economy was Wrecked by the Politics of Deregulation in Florida

Conn Hallinan
The Honduran Coup: a U.S. Connection

Russell Mokhiber
Health Care: In Defense of Disruption

Paul Krassner
The Mystery Behind the Manson Murders

Sousan Hammad
Orgy of the Dead: the 2009 Fatah Conference

Jonathan Cook
Israeli School Apartheid

Ira Glunts
Netanyahu's Sister-in-Law Detained by Israeli Police; Calls Evictions an Unjustified Folly

George Wuerthner
Dead Tree Hysteria

Website of the Day
Conyers: ObamaCare is Crap

August 7 - 9, 2009

Alexander Cockburn
It Pays to Have a Nuke

Mike Whitney
Economy on a Scaffold

Elaine C. Hagopian
Obama's Israel Albatross

Carl Ginsburg
RX For Healthcare

Miguel Tinker Salas
Honduras is Only Part of the Story: the Conservative Counter-Attack in Latin America

Saul Landau
The Kidney Broker and the Money Laundering Rabbis

John Ross
The Mexican Genome: Big Science in the Service of Indian Genocide?

Anthony DiMaggio Obama and the Israel Lobby: Origins of Power

John Stanton
Expanding Human Terrain Systems?

Christopher Brauchli Legal Absurdities: Outing Three Strikes

Wajahat Ali
A Muslim American Hero: an Interview with Dave Eggers on "Zeitoun"

Ron Jacobs
As Long as the Wars Continue, We Must Resist Them

Franklin Lamb
Sunday Morning on the Dunes: Cleaning "Free Gaza Beach"

Bruce E. Levine
Protect Us From Our Friends

Michael Winship
Neighborhood Watch for Planet Earth

David Macaray
Glimmers of Hope for Labor?

Stephen Fleischman
Suicide Squad

Robert Bryce
Unplugging the Next Big Thing: the Hype Over Electric Cars

Robert Dodge, MD: Hiroshima and Nagasaki Remembered

Mark Seth Lender
The Message of the Glossy Ibis

David Yearsley
Vaucanson's Faun and the Duck in the Attic

Ben Sonnenberg
Chris Fuller's Brilliant Debut

Lorenzo Wolff
When Music's the Character

Poets' Basement
Dominguez and Corseri

Website of the Weekend
Warren Buffett's Betrayal

August 6, 2009

Ishmael Reed
Let's All Have a Beer

Paul Craig Roberts
The Expiring Economy

William Blum Assassinations and Coups: Keeping Track of the Empire's Crimes

Michael Donnelly
Rod Coronado: the Hardest Working Man in Animal Rights "Terrorism"

Jonathan Cook
Rabbis Ban Marriage for Israeli "Untouchables"

Dave Lindorff
The Health Care Reform Sell-Out

Ellen Brown
The Public Option in Banking

Website of the Day
Ellsberg on Hiroshima

August 5, 2009

Dedrick Muhammad /
Barbara Ehrenreich
The Destruction of the Black Middle Class

Norman Solomon
The Incredible, Shrinking Health Care Plan

William Blum
The Myths of Afghanistan: Past and Present

Gareth Porter
The ISI and the Taliban: US Officials Are Protecting Pakistani Aid to Taliban

Mary Lynn Cramer
The Myth of Medicare for All

Jim Goodman
Obama Needs to Take a Stand on Trade

Nadia Hijab
Playing From Strength in the Middle East

Gretchen Kroth
Guatemala's Garbage Dump Education System

Steve Macek /
Scott Sanders
Privatizing the Airwaves

Sarah Lazare
Inside G.I. Resistance

Website of the Day
The Locavore Myth

August 4, 2009

Mike Whitney
Bernanke's Shell Game

Dave Lindorff
The Recession Isn't Over, By a Long Shot

Patrick Cockburn
Did British Bomb Attacks in Iran Provoke Hostage Crisis?

Jonathan Cook
Israel's Campaign to Silence Human Rights Groups

Jeff Sher
Making a Mess of Health Care Reform

Dean Baker
Why Don't We Globalize Health Care?

Andy Worthington
Gitmo as Hotel California

Uri Avnery
A Jeremiad

Mark Weisbrot
U.S.-Brokered Mediation in Honduras Has Failed

Alvaro Huerta
Hold That Dustbin! So Much for the "End of Racism"

Website of the Day
Pentagon to Ban Facebook and Twitter?

September 15, 2009

The Real Lesson of Lehman's Fall

Lehman Died So TARP and AIG Might Live

By MIKE WHITNEY

"Lehman's fate was sealed not in the boardroom of that gaudy Manhattan headquarters. It was sealed downtown, in the gloomy gray building of the New York Federal Reserve, the Wall Street branch of the U.S. central bank."

-- Stephen Foley, U.K. Independent

Stephen Foley is on to something.  Lehman Bros. didn't die of natural causes; it was drawn-and-quartered by high-ranking officials at the US Treasury and the Federal Reserve. Most of the rubbish presently appearing in the media, ignores this glaring fact. Lehman was a planned demolition (most likely) concocted by ex-Goldman Sachs CEO Henry Paulson, who wanted to create a financial 9-11 to scare Congress into complying with his demands for $700 billion in emergency funding (TARP) for underwater US banking behemoths.  The whole incident reeks of conflict of interest, corruption, and blackmail.

The  media have played a critical role in peddling the official "Who could have known what would happen" version of events. Bernanke and Paulson were fully aware that they playing with fire, but they chose to proceed anyway, using the mushrooming crisis to achieve their own objectives. Then things began to spin out of control; credit markets froze, interbank lending slowed to a crawl, and stock markets plunged. Even so, the Fed and Treasury persisted with their plan, demanding their $700 billion pound of flesh before they'd do what was needed to stop the bleeding. It was all avoidable. 

Lehman had potential buyers--including Barclays--who probably would have made the sale if Bernanke and Paulson had merely provided guarantees for some of their trading positions. Instead, Treasury and the Fed balked, thrusting the knife deeper into Lehman's ribs. They claimed they didn't have legal authority for such guarantees. It’s a lie. The Fed has provided $12.8 trillion in loans and other commitments to keep the financial system operating without congressional approval or any explicit authorization under the terms of its charter. The Fed never considered the limits of its "legal authority" when it bailed-out AIG or organized the acquisition of Bear Stearns by JP Morgan pushing $30 billion in future liabilities onto the public's balance sheet. The Fed's excuses don't square with the facts.

Here's how economist Dean Baker recounts what transpired last September 15:

"Last September, when he (Bernanke) was telling Congress that the economy would collapse if it did not approve the $700 billion TARP bailout, he warned that the commercial paper market was shutting down.

This was hugely important because most major companies rely on selling commercial paper to meet their payrolls and pay other routine bills. If they could not sell commercial paper, then millions of people would soon be laid off and the economy would literally collapse.

What Mr. Bernanke apparently forgot to tell Congress back then is that the Fed has the authority to directly buy commercial paper from financial and non-financial companies. In other words, the Fed has the power to prevent the sort of economic collapse that Bernanke warned would happen if Congress did not quickly approve the TARP. In fact, Bernanke announced that the Fed would create a special lending facility to buy commercial paper the weekend after Congress voted to approve the TARP." ("Bernanke's bad Money", Dean Baker, CounterPunch)

The reason Bernanke did not underwrite the commercial paper market was, if he had, he wouldn't have been able to blackmail congress. He needed the rising anxiety from the crisis to achieve his goals.

Here's a clip from an editorial in the New York Times (admitting most of what has already been stated) that tries to put a positive spin on the Fed's behavior:

"Mr. Nocera says that almost everyone he’s ever spoken to in Hank Paulson’s old Treasury Department agrees that without the immediate panic caused by the Lehman default, the government would never have agreed to make the loans needed to save A.I.G., a company it knew very little about. In effect, the Lehman bankruptcy caused the government to panic, which in turn caused it to save the firm it really had to save to prevent catastrophe. In retrospect, if you had to choose one firm to throw under the bus to save everyone else, you would choose Lehman.....it is quite likely that the financial crisis would have been even worse had Lehman been rescued. Although nobody realized it at the time, Lehman Brothers had to die for the rest of Wall Street to live. ("Lehman Had to Die So Global Finance Could Live", Sept 14, 2009, New York Times)

So, according to the muddled logic of the NY Times, everything worked out for the best so there's no need to hold anyone accountable. (Tell that to the 7 million people who have lost their jobs since the beginning of the meltdown) This latest bit of spin is pure cover-your-ass journalism, an attempt to rewrite history and absolve the guilty parties. The fact is, Paulson and Bernanke deliberately created the crisis in order to jam their widely-reviled TARP policy down the public's throat.  The Times thinks the public should be grateful for that because, otherwise, the crooked insurance giant, AIG, would not have been bailed out and Goldman Sachs and other Wall Street heavies would not have been paid off.

The reason panic spread through the markets after Lehman filed for bankruptcy, was because the Reserve Primary Fund, which had lent Lehman $785 million (and recieved short-term notes called commercial paper) couldn't keep up with the rapid pace of withdrawals from worried clients. The sudden erosion of trust triggered a run on the money markets. Here's an excerpt from a Bloomberg article, "Sleep-At-Night-Money Lost in Lehman Lesson Missing $63 Billion":

"On Tuesday, Sept. 16, the run on Reserve Primary continued. Between the time of Lehman’s Chapter 11 announcement and 3 p.m. on Tuesday, investors asked for $39.9 billion, more than half of the fund’s assets, according to Crane Data.

“Reserve’s trustees instructed employees to sell the Lehman debt, according to the SEC.

“They couldn’t find a buyer.

“At 4 p.m., the trustees determined that the $785 million investment was worth nothing. With all the withdrawals from the fund, the value of a single share dipped to 97 cents.

“Legg Mason, Janus Capital Group Inc., Northern Trust Corp., Evergreen and Bank of America Corp.’s Columbia Management investment unit were all able to inject cash into their funds to shore up losses or buy assets from them. Putnam closed its Prime Money Market Fund on Sept. 18 and later sold its assets to Pittsburgh-based Federated Investors.

“At least 20 money fund managers were forced to seek financial support or sell holdings to maintain their $1 net asset value, according to documents on the SEC Web Site.

“When news that Reserve Primary broke the buck hit the wires at 5:04 p.m. that Tuesday, the race was on" (Bloomberg)

This is what a run on the shadow banking system looks like. Bernanke and Paulson pinpointed the trouble in the commercial paper market and used it to put more pressure on Congress to approve their bailout bill.

Bloomberg again:

"It was commercial paper and the $3.6 trillion money market industry that traded the notes that came close to sinking the global economy -- not a breakdown in credit-default swaps or bank-to-bank lending....

“Like ice-nine, the fictitious substance in Kurt Vonnegut Jr.'s  1963 novel Cat’s Cradle, a single seed of which could harden all the world’s water, commercial paper was the crystallizing force that froze credit markets, choking off the ability of companies and banks to borrow money and pay bills." (Sleep-At-Night-Money Lost in Lehman Lesson Missing $63 Billion,  Bob Ivry, Mark Pittman and Christine Harper, Bloomberg News)

Bernanke could have fixed the problem in an instant. All he needed to do was provide explicit government guarantees on money markets and commercial paper. That would have ended the bank-run pronto.  But he chose not to. He chose to wait until Congress capitulated so he could net $700 billion for his banking buddies.

According to the UK Telegraph:

"On Thursday night, the Treasury went literally down on his knees before Nancy Pelosi, speaker of the House of Representatives, begging her to agree taxpayer money to bail out the financial system. Bernanke, a scholar of the financial panic that caused the Great Depression, told fearful lawmakers there wouldn't be a banking system in place by Monday morning if they didn't act. Paulson talked openly about planning for martial law, about how to feed the American people if banking and commerce collapsed."

Despite their dire warnings, on Monday morning, the banking system was still in tact, just as it was a full month later when the first TARP funds were handed out to the big banks. It was all a hoax. The problem wasn't the banks toxic assets at all, but the commercial paper and money markets. The Fed and Treasury knew that they could count on Congress's abysmal ignorance of anything financial; and they weren't disappointed. On October 3, 2008, Congress passed the Financial Rescue Plan (TARP) Paulson's fear-mongering had triumphed.  

Here's a quick look at the Lehman chronology:

On Sept 15, 2008, Lehman Bros filed for bankruptcy sending the Dow plummeting 504 points.

On Sept 17, the Dow falls 449 points in reaction to AIG bailout.

On Sept 29, the Dow tumbles 777 points after House votes "No" on TARP.

On Oct 3, the House passes Financial Rescue Plan (TARP) The Dow falls 818 points.

On Oct 7, the Fed creates the Commercial Paper Funding Facility to backstop the commercial paper market. Two weeks later, Bernanke announces the Money Market Investor Funding Facility to make loans of longer maturities.

These are the two facilities which relieved the tension in the markets, not the TARP funds. It's clear that Bernanke knew exactly how to fix the problem, because he did so as soon as the TARP was passed. Here's economist Dean Baker in The American Prospect:

"Bernanke was working with Paulson and the Bush administration to promote a climate of panic. This climate was necessary in order to push Congress to hastily pass the TARP without serious restrictions on executive compensation, dividends, or measures that would ensure a fair return for the public's investment.

“Bernanke did not start buying commercial paper until after the TARP was approved by Congress because he did not want to take the pressure off, thereby leading Congress to believe that it had time to develop a better rescue package. ("Did Ben Bernanke Pull the TARP Over Eyes?", Dean Baker, The American Prospect)

The American people have been ripped off by industry reps working the policy-levers from inside the government.  That's the real lesson of the Lehman bankruptcy. Happy anniversary. 

Mike Whitney lives in Washington state. He can be reached at fergiewhitney@msn.com

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