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Octafish's Journal
Octafish's Journal
March 2, 2014

''...he's doing what he's always done best: talking out of both sides of his mouth...''

By their works shall Thee know them. Dr. Froman's the guy tapped to do Big Things.

Michael Froman and the revolving door

By Felix Salmon
Reuters, DECEMBER 11, 2009

Michael Froman is one of those behind-the-scenes technocrats who never quite makes it into full public view. But according to Matt Taibbi, he’s one of the most egregious examples — up there with Bob Rubin, literally — we’ve yet seen of the way the revolving door works between business and government generally, and between Citigroup and Treasury in particular.

I’m not sure how much of this information is new, but a lot of it was new to me, especially the bit about Froman “leading the search for the president’s new economic team” — while he was still pulling down a multi-million-dollar salary at Citigroup, no less. Apologies for quoting at length:

Leading the search for the president’s new economic team was his close friend and Harvard Law classmate Michael Froman, a high-ranking executive at Citigroup. During the campaign, Froman had emerged as one of Obama’s biggest fundraisers, bundling $200,000 in contributions and introducing the candidate to a host of heavy hitters — chief among them his mentor Bob Rubin, the former co-chairman of Goldman Sachs who served as Treasury secretary under Bill Clinton. Froman had served as chief of staff to Rubin at Treasury, and had followed his boss when Rubin left the Clinton administration to serve as a senior counselor to Citigroup (a massive new financial conglomerate created by deregulatory moves pushed through by Rubin himself).

Incredibly, Froman did not resign from the bank when he went to work for Obama: He remained in the employ of Citigroup for two more months, even as he helped appoint the very people who would shape the future of his own firm. And to help him pick Obama’s economic team, Froman brought in none other than Jamie Rubin, a former Clinton diplomat who happens to be Bob Rubin’s son. At the time, Jamie’s dad was still earning roughly $15 million a year working for Citigroup, which was in the midst of a collapse brought on in part because Rubin had pushed the bank to invest heavily in mortgage-backed CDOs and other risky instruments…

On November 23rd, 2008, a deal is announced in which the government will bail out Rubin’s messes at Citigroup with a massive buffet of taxpayer-funded cash and guarantees… No Citi executives are replaced, and few restrictions are placed on their compensation. It’s the sweetheart deal of the century, putting generations of working-stiff taxpayers on the hook to pay off Bob Rubin’s fuck-up-rich tenure at Citi. “If you had any doubts at all about the primacy of Wall Street over Main Street,” former labor secretary Robert Reich declares when the bailout is announced, “your doubts should be laid to rest.”

It is bad enough that one of Bob Rubin’s former protégés from the Clinton years, the New York Fed chief Geithner, is intimately involved in the negotiations, which unsurprisingly leave the Federal Reserve massively exposed to future Citi losses. But the real stunner comes only hours after the bailout deal is struck, when the Obama transition team makes a cheerful announcement: Timothy Geithner is going to be Barack Obama’s Treasury secretary!

Geithner, in other words, is hired to head the U.S. Treasury by an executive from Citigroup — Michael Froman — before the ink is even dry on a massive government giveaway to Citigroup that Geithner himself was instrumental in delivering. In the annals of brazen political swindles, this one has to go in the all-time Fuck-the-Optics Hall of Fame.

Wall Street loved the Citi bailout and the Geithner nomination so much that the Dow immediately posted its biggest two-day jump since 1987, rising 11.8 percent. Citi shares jumped 58 percent in a single day, and JP Morgan Chase, Merrill Lynch and Morgan Stanley soared more than 20 percent, as Wall Street embraced the news that the government’s bailout generosity would not die with George W. Bush and Hank Paulson.

[font color="green"]How much influence did Froman have over the appointment of Geithner as Treasury secretary? Geithner, who wanted to become Treasury secretary and who as New York Fed president was a central (if not the central) figure in orchestrating the massive Citigroup bailout just after the election, knew what Froman’s job was in the Obama transition team, and knew that Froman was a senior executive at Citigroup.[/font color]



Thanks for the heads-up, Ichingcarpenter. I'd always wondered what happened to Stiglitz and Galbraith the Younger.
March 1, 2014

If TPP is so good for us, why does Wall Street pay negotiators millions in bonuses?

For Services Rendered? Wall Street’s Big Paydays For Trade Negotiators

by Richard Eskow
Published on Friday, February 28, 2014 by Campaign for America's Future Blog


Here’s one possible answer: You negotiate trade deals like NAFTA and the Trans-Pacific Partnership (TPP), the new pact that the administration is currently trying to ram through Congress. A recent report confirms that some of the officials crafting this latest agreement were paid handsomely by the Wall Street institutions that stand to benefit from it.

As the United States trade representative, Michael Froman has primary responsibility for the TPP. A new investigation from Republic Report reveals that Froman received more than $4 million in payouts from his then-employer Citigroup as he was leaving to join the Obama administration.


The New York Times reports that Froman also had a half-million dollars in a Cayman Island account managed by Citigroup, which used the infamous Ugland House tax dodge. This modest building houses more than 18,000 legal entities. Republican Sen. Charles Grassley (R-Iowa) called Ugland House “the biggest tax scam in the world.”

Froman also reportedly invested in funds that took advantage of the “carried interest” loophole. It’s a political embarrassment for an administration appointee to profit from tax deals that the White House opposes. Perhaps that’s why Citigroup also paid him a multimillion-dollar bonus to cash out of these funds.

Consider the sequence of events. First, the taxpayers created Citigroup, then it shafted the taxpayers. And meanwhile, its CEO has been trying to convince Americans that their government can’t afford to pay Social Security benefits or pay for other important programs, through his membership in the Wall Street front group known as “Fix the Debt.”



March 1, 2014

There isn't enough money in the world for some people.

So, they hire henchmen to help them steal more.

They can afford publicists, hacks and disinformationists, too.

They can't afford you or me, though, Rex.

There isn't enough money to pay you or me to help them get away with their various treasons, from Congo to the present day. There isn't a share big enough to give you or me to help them pass and carry their loot off to Switzerland via the Caymans, as the rest of the nation gets poorer and hungrier and colder and sicker and dumber and servile.

Such characters are in service to what passes for the STASI of the national security state, lapdogs to the Have Mores. Pointing that out is weird to them. They've even intimated that I and the people at the Duquesne JFK conference do it "for the money" as if they don't know that the only people who get to sell their books on tee vee say "Oswald did it."

February 28, 2014

Know your BFEE: Behind the Curtain -- Booz Allen Hamilton and its Owner, The Carlyle Group

Behind the Curtain: Booz Allen Hamilton and its Owner, The Carlyle Group

Written by Bob Adelmann
The New American; June 13, 2013

According to writers Thomas Heath and Marjorie Censer at the Washington Post, The Carlyle Group and its errant child, Booz Allen Hamilton (BAH), have a public relations problem, thanks to NSA leaker and former BAH employee Edward Snowden. By the time top management at BAH learned that one of their top level agents had gone rogue, and terminated his employment, it was too late.

For years Carlyle had, according to the Post, “nurtured a reputation as a financially sophisticated asset manager that buys and sells everything from railroads to oil refineries”; but now the light from the Snowden revelations has revealed nothing more than two companies, parent and child, “bound by the thread of turning government secrets into profits.”

And have they ever. When The Carlyle Group bought BAH back in 2008, it was totally dependent upon government contracts in the fields of information technology (IT) and systems engineering for its bread and butter. But there wasn't much butter: After two years the company’s gross revenues were $5.1 billion but net profits were a minuscule $25 million, close to a rounding error on the company’s financial statement. In 2012, however, BAH grossed $5.8 billion and showed earnings of $219 million, nearly a nine-fold increase in net revenues and a nice gain in value for Carlyle.

Unwittingly, the Post authors exposed the real reason for the jump in profitability: close ties and interconnected relationships between top people at Carlyle and BAH, and the agencies with which they are working. The authors quoted George Price, an equity analyst at BB&T Capital: "[Booz Allen has] got a great brand, they've focused over time on hiring top people, including bringing on people who have a lot of senior government experience." (Emphasis added.)

For instance, James Clapper had a stint at BAH before becoming the current Director of National Intelligence; George Little consulted with BAH before taking a position at the Central Intelligence Agency; John McConnell, now vice chairman at BAH, was director of the National Security Agency (NSA) in the ‘90s before moving up to director of national intelligence in 2007; Todd Park began his career with BAH and now serves as the country's chief technology officer; James Woolsey, currently a senior vice president at BAH, served in the past as director of the Central Intelligence Agency; and so on.

BAH has had more than a little problem with self-dealing and conflicts of interest over the years. For instance in 2006 the European Commission asked the American Civil Liberties Union (ACLU) and Privacy International (PI) to investigate BAH’s involvement with President George Bush’s SWIFT surveillance program, which was viewed by that administration as “just another tool” in its so-called “War on Terror.” The only problem is that it was illegal, as it violated U.S., Belgian, and European privacy laws. BAH was right in the middle of it. According to the ACLU/PI report,

Though Booz Allen’s role is to verify that the access to the SWIFT data is not abused, its relationship with the U.S. Government calls its objectivity significantly into question. (Emphasis added.)

Among Booz Allen’s senior consulting staff are several former members of the intelligence community, including a former Director of the CIA and a former director of the NSA.

As noted by Barry Steinhardt, an ACLU director, “It’s bad enough that the [Bush] administration is trying to hold out a private company as a substitute for genuine checks and balances on its surveillance activities. But of all companies to perform audits on a secret surveillance program, it would be difficult to find one less objective and more intertwined with the U.S. government security establishment.” (Emphasis added.)

CONTINUED w Links n Privatized INTEL...


Thanks, Rex! It's good to live in a democracy, a republic built on equal justice for all. So, that's why it's worth the sweat to get back to that.
February 27, 2014

Oath to whom? Booz Allen Hamilton?

You know who owns them?

Carlyle Group.

You know who owns them?


BTW: Any order coming from that bunch is illegal.

February 25, 2014

DDDD Deny, Disrupt, Degrade, Deceive


February 24, 2014


BFEE connected pukes stole the patents and the INSLAW "PROsecutor Management Information System" software from a private company owned by a husband and wife developers in the mid-80s. The Hamiltons sued and a Federal judge ruled against the government, finding that members of the U.S. Government engaged in a criminal conspiracy to steal the software and privatize the profits, ripping off the owners for a lot of loot. So, rather than pony up, the Reagan-Bush-Meese Justice Department turned the failed prosecutor into the Appeals judge who then ruled for them.


The government's appointed agents, the BFEE connected friends of Reagan-Bush-Meese, would go on to sell it to countries around the world interested in monitoring "criminal cases" as they wound through their GULAGs. Later on, the software is alleged to have been used for all sorts of back-door dealings to find out "Who" was "Where" in "Which" GULAG.

February 22, 2014

Anatomy of the Deep State -- The Shadow Government that calls the shots

Per Bill Moyers via Alternet...

D.C. Insider Mike Lofgren -- a congressional staff member for 28 years specializing in national security possessing top secret security clearance -- reports: There's a Shadow Govt. Running the Country, and It's Not Up for Re-Election. Power centers in DC and the corporate corridors of Manhattan and Silicon Valley are calling the shots. I'd recommend DUers, while the lights are still on, go to either source and download their own copy.

Anatomy of the Deep State

Rome lived upon its principal till ruin stared it in the face. Industry is the only true source of wealth, and there was no industry in Rome. By day the Ostia road was crowded with carts and muleteers, carrying to the great city the silks and spices of the East, the marble of Asia Minor, the timber of the Atlas, the grain of Africa and Egypt; and the carts brought out nothing but loads of dung. That was their return cargo. —"The Martyrdom of Man" by Winwood Reade (1871)

By Mike Lofgren
BillMoyers.com / Feb. 21, 2014

There is the visible government situated around the Mall in Washington, and then there is another, more shadowy, more indefinable government that is not explained in Civics 101 or observable to tourists at the White House or the Capitol. The former is traditional Washington partisan politics: the tip of the iceberg that a public watching C-SPAN sees daily and which is theoretically controllable via elections. The subsurface part of the iceberg I shall call the Deep State, which operates on its own compass heading regardless of who is formally in power. [1]

During the last five years, the news media have been flooded with pundits decrying the broken politics of Washington. The conventional wisdom has it that partisan gridlock and dysfunction have become the new normal. That is certainly the case, and I have been among the harshest critics of this development. But it is also imperative to acknowledge the limits of this critique as it applies to the American governmental system. On one level, the critique is self-evident: in the domain that the public can see, Congress is hopelessly deadlocked in the worst manner since the 1850s, the violently rancorous decade preceding the Civil War.


The Deep State is the big story of our time; it is the red thread that runs through the war on terrorism, the financialization and deindustrialization of the American economy, the rise of a plutocratic social structure and political dysfunction. Washington is the headquarters of the Deep State, and its time in the sun as a rival to Rome, Constantinople, or London may be term-limited by its overweening sense of self-importance and its habit, as Winwood Reade said of Rome, to “lived upon its principal till ruin stared it in the face.” Living upon its principal in this case means that the Deep State has been extracting value from the American people in vampire-like fashion.

We are faced with two disagreeable implications. First, that the Deep State is so heavily entrenched, so well protected by surveillance, firepower, money and its ability to co-opt resistance that it is almost impervious to change. Second, that just as in so many previous empires, the Deep State is populated with those whose instinctive reaction to the failure of their policies is to double down on those very policies in the future. Iraq was a failure briefly camouflaged by the wholly propagandistic success of the so-called surge; this legerdemain allowed for the surge in Afghanistan, which equally came to naught. Undeterred by that failure, the functionaries of the Deep State plunged into Libya; the smoking rubble of the Benghazi consulate, rather than discouraging further misadventure, seemed merely to incite the itch to bomb Syria. Will the Deep State ride on the back of the American people from failure to failure until the country itself, despite its huge reserves of human and material capital, is slowly exhausted? The dusty road of empire is strewn with the bones of former great powers that exhausted themselves in like manner.

The final factor is Silicon Valley. Owing to secrecy and obfuscation, it is hard to know how much of the NSA’s relationship with the Valley is based on voluntary cooperation, how much is legal compulsion through FISA warrants and how much is a matter of the NSA surreptitiously breaking into technology companies’ systems. Given the Valley’s public relations requirement to mollify its customers who have privacy concerns, it is difficult to take the tech firms’ libertarian protestations about government compromise of their systems at face value, especially since they engage in similar activity against their own customers for commercial purposes. That said, evidence is accumulating that Silicon Valley is losing billions in overseas business from companies, individuals and governments that want to maintain privacy. For high-tech entrepreneurs, the cash nexus is ultimately more compelling than the Deep State’s demand for patriotic cooperation. Even legal compulsion can be combatted: unlike the individual citizen, tech firms have deep pockets and batteries of lawyers with which to fight government diktat.

CONTINUED w/LINKS to sources...


Thank goodness or chance for Mike Lofgren, Bill Moyers, and DU. We may yet reverse the trend of We the People paying for wars without end for privatized power and profits and its associated rich getting richer while the rest of us become Have-Nots.

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