http://www.counterpunch.com/nader07022008.html
Greed Without Accountability by Ralph Nader Counterpunch: July 02 2008 The worst top management of giant corporations in American history is also by far the most hugely paid. That contradiction applies as well to the Boards of Directors of these global companies. Consider these illustrations: The bosses of General Motors (GM) have presided over the worst decline of GM shares in the last fifty years, the lowering of GM bonds to junk status, the largest money losses and layoffs of tens of thousands of workers. Yet these top executives are still in place and still receiving much more pay than their successful counterparts at Toyota. GM's stock valuation is under $7 billion dollars, while Toyota is valued at over $160 billion. Toyota, having passed GM in worldwide sales, is about to catch up with and pass GM in sales inside the United States itself! GM's executives stayed with their gas guzzling SUVs way beyond the warning signs. Their vehicles were uninspiring and technologically stagnant in various ways. They were completely unprepared for Toyota's hybrid cars and for the upward spiral in gasoline prices. They're cashing their lucrative monthly checks with the regular votes of confidence by their hand-picked Board of Directors. About the same appraisal can be made of Ford Motor Company, which at least brought in new management to try to do something about that once famous company's sinking status. Then there are the financial companies. Top management on Wall Street has been beyond incompetent. Wild risk taking camouflaged for years by multi-tiered, complex, abstract financial instruments (generally called collateralized debt obligations) kept the joy ride going and going until the massive financial hot air balloon started plummeting. Finally told to leave their high posts, the CEOs of Merrill-Lynch and Citigroup took away tens of millions of severance pay while Wall Street turned into Layoff Street. The banks, investment banks and brokerage firms have tanked to levels not seen since the 1929-30 collapse of the stock market. Citigroup, once valued at over $50 per share is now under $17 a share. Washington Mutual - the nation's largest savings bank chain was over $40 a share in 2007. Its reckless speculative binge has driven it down under $5 a share. Yet its CEO Kerry Killinger remains in charge, with the continuing support of his rubberstamp Board of Directors. A recent $8 billion infusion of private capital gave a sweetheart deal to these new investors at the excessive expense of the shareholders. Countrywide, the infamous giant mortgage lender (subprime mortgages) is about to be taken over by Bank of America. Its CEO is taking away a reduced but still very generous compensation deal. Meanwhile, all these banks and brokerage houses' investment analysts are busy downgrading each others' stock prospects. Over at the multi-trillion dollar companies Fannie Mae and Freddie Mac, the shareholders have lost about 75 percent of their stock value in one year. Farcically regulated by the Department of Housing and Urban Affairs, Fannie and Freddie were run into the ground by taking on very shaky mortgages under the command of CEOs and their top executives who paid themselves enormous sums. These two institutions were set up many years ago to provide liquidity in the housing and loan markets and thereby expand home ownership especially among lower income families. Instead, they turned themselves into casinos, taking advantage of an implied US government guarantee. The Fannie and Freddie bosses created another guarantee. They hired top appointees from both Republican and Democratic Administrations (such as Deputy Attorney General Jamie Gorelick) and lathered them with tens of millions of dollars in executive compensation. In this way, they kept federal supervision at a minimum and held off efforts in Congress to toughen regulation. These executives are all gone now, enjoying their maharajan riches with impunity while pensions and mutual funds lose and lose and lose with no end in sight, short of a government-taxpayer bailout. Over a year ago, leading financial analyst Henry Kaufman and very few others warned about "undisciplined" (read unregulated) and "mis-pricing" of lower quality assets. Mr Kaufman wrote in the Wall Street Journal of August 15 2007 that "If some institutions are really 'too big to fail', then other means of discipline will have to be found". There are ways to prevent such crashes. In the nineteen thirties, President Franklin Delano Roosevelt chose stronger regulation, creating the Securities and Exchange Commission (SEC) and several bank regulatory agencies. He saved the badly listing capitalist ship. Today, there is no real momentum in a frozen Washington, DC to bring regulation up to date. To the contrary, in 1999, Congress led by Senator McCain's Advisor, former Senator Phil Gramm and the Clinton Administration led by Robert Rubin, Secretary of the Treasury, and soon to join Citibank, de-regulated and ended the wall between investment banks and commercial banking known as the Glass-Steagall Act. Clinton and Congress opened the floodgates to rampant speculation without even requiring necessary and timely disclosures for the benefit of institutional and individual investors. Now the entire US economy is at risk. The domino theory is getting less theoretical daily. Without investors obtaining more legal authority as owners over their out of control company officers and Boards of Directors, and without strong regulation, corporate capitalism cannot be saved from its toxic combination of endless greed and maximum power - without responsibility. Uncle Sam, the deeply deficit ridden bailout man, may have another taxpayers-to-the-rescue operation for Wall Street. But don't count on stretching the American dollar much more without devastating consequences to and from global financial markets in full panic. Consider the US dollar like an elastic band. You can keep stretching this rubber band but suddenly it BREAKS. Our country needs action NOW from Washington, DC. _____ Ralph Nader is running for president as an independent. *** ----- Original Message ----- From: Sue Welsh To: [EMAIL PROTECTED] Sent: Wednesday, July 16, 2008 12:19 PM Subject: BLurb for KPFK's 50th Anniversary Kick-off Hi Ed: Hope you are doing well. Here's a short blurb. This is a kick-off to the 50th, to get folks engaged in telling that five-decade long story in different ways over the next several months through a variety of media and activities. Many thanks, Sue Imagine, KPFK Pacifica Radio will reach its 50th year of continuous community service in 2009. To kick-off our 50th anniversary year celebrations, KPFK presents Culture Clash, the hilarious and potent satirical trio (www.cultureclash.com) , on July 27 in a benefit performance for KPFK at the John Anson Ford Amphitheatre in Hollywood, also featuring KPFK's own Pocho Hour of Power led by Lalo Alcaraz, creator of the daily comic strip "La Cucaracha" and the music of Mezklah. A Rollicking EVENING under the stars with CULTURE CLASH, featuring rare and satirical works from their historical anthology .Plus performances by Lalo Alcaraz and his Pocho Hour of Power-- hilarious comic artists and musicians who are generously donating their creative time and extraordinary talent to support KPFK Listener-Sponsored Community Radio! Tickets are $35 and $25. For ticket information, please visit kpfk.org, call the Ford at (323) 461-3673 or visit www.fordtheatres.org. To make reservations for the pre-Celebrity Reception, please contact: Sue A. Welsh KPFK Development Director Tel: (818) 985-2711 ext. 214 FACT SHEET: WHO: CULTURE CLASH KPFK's LALO ALCARAZ AND THE POCHO HOUR OF POWER and music guest MEZKLAH WHAT: Kicking off KPFK's 50th Golden Anniversary 1959-2009 BENEFIT PERFORMANCE FOR KPFK RADIO WHEN: SUNDAY EVENING,JULY 27, 2008 at 8:00pm WHERE: JOHN ANSON FORD AMPHITHEATRE, HOLLYWOOD TICKETS: on sale now!!!!! ~ $35/$25 For tickets, visit www.kpfk.org or www.fordtheatres.org or call the Ford at 323-461-3673. PRE-SHOW CELEBRITY RECEPTION: For reservations, please call, SUe Welsh at (818) 985-2711 ext. 214 ------------------------------------ --------------------------------------------------------------------------- LAAMN: Los Angeles Alternative Media Network --------------------------------------------------------------------------- Unsubscribe: <mailto:[EMAIL PROTECTED]> --------------------------------------------------------------------------- Subscribe: <mailto:[EMAIL PROTECTED]> --------------------------------------------------------------------------- Digest: <mailto:[EMAIL PROTECTED]> --------------------------------------------------------------------------- Help: <mailto:[EMAIL PROTECTED]> --------------------------------------------------------------------------- Post: <mailto:[EMAIL PROTECTED]> --------------------------------------------------------------------------- Archive1: <http://www.egroups.com/messages/laamn> --------------------------------------------------------------------------- Archive2: <http://www.mail-archive.com/[EMAIL PROTECTED]> --------------------------------------------------------------------------- Yahoo! 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