Undernews is the online report of the Progressive Review, edited by Sam Smith, who has covered Washington during all or part of one quarter of America's presidencies and edited alternative journals since 1964. The Review has been on the web since 1995. See main page for full contents

March 27, 2009



Phil Mattera, Dirt Diggers' Digest -
In recent days it has seemed as if two men with the same name are serving as Secretary of the Treasury. On the one hand, we have the wimpy Tim Geithner, who let AIG get away with its bonus outrage and who has come up with a new scheme to get rid of toxic assets of banks that is a massive giveaway to hedge funds. On the other hand, this week has seen the lionhearted Tim Geithner, who is proposing what appears to be an audacious expansion of federal regulation of financial markets.

The wimpy version has been around for quite a while, characterizing the Geithner who headed the Federal Reserve Bank of New York for five years before he was chosen for Treasury. A look through the online archive of the New York Fed turns up the texts of numerous speeches in which Geithner acted as a cheerleader for the forms of financial "innovation" that paved the way to the current calamity of the world economy. Geithner was not oblivious to the escalation of risk that derivatives and the like were creating, but he expressed confidence that the system could accommodate it. At most, some tinkering with the regulatory structure might be necessary. . .

If there were a truly intrepid Geithner, he would be talking about regulations that put an end to the most speculative financial transactions, rebuild a wall between commercial banking and investment banking, and dismantle huge financial institutions such as Citigroup. That Geithner has yet to appear on the scene.

NY Times -
Attorney General Andrew M. Cuomo of New York said that he was widening his investigation of the American International Group to examine whether its trading counterparties improperly received billions of dollars in government money from the troubled insurer.

Those counterparties include Goldman Sachs, which received $12.9 billion, as well as Societe Generale of France and Deutsche Bank of Germany, which each received nearly $12 billion.

"Our investigation into corporate bonuses has led us to an investigation of the credit default swap contracts at A.I.G.," Mr. Cuomo said in a statement. "CDS contracts were at the heart of A.I.G.'s meltdown. The question is whether the contracts are being wound down properly and efficiently or whether they have become a vehicle for funneling billions in taxpayers dollars to capitalize banks all over the world."


House version of single payer health legislation has been endorsed by the US Conference of Mayors, and 40 city and state bodies including Baltimore, Indianapolis, Austin, Wilmington, Chicago, Detroit, Philadelphia, Seattle and San Francisco. It also has the support of 500 union organizations in 49 states. The one place it is not on the table, however, is at the White House.


- In Napa Valley, the newly opened Bardessono Inn and Spa is perhaps the greenest luxury hotel in the country. . . Perhaps most impressive is the fact that 93 percent of the Bardessono's construction waste was recycled - an unusually high amount. Materials like wood, steel and paper which would normally be trashed were reused in the construction of the Inn. . . In separating all the refuse and taking the time to work with recyclers, it caused everyone to keep a cleaner job site. Not only does that lead to fewer injuries, but it fosters a level of attention that becomes an ethic on the property. The Bardessono also features computer-controlled external shades on the windows. These shades open and close automatically to regulate temperature in the rooms. . . . In addition, the Bardessono has no less than 82 geothermal wells, and there are 900 photovoltaic solar panels on the roof.

Philadelphia's new budget includes money for solar powered trash compacting cans that can hold five times as much trash as conventional containers. NYC, Boston and Chicago are already using the new cans.


- The Missouri Highway Patrol retracted a controversial report on militia activity and will change how such reports are reviewed before being distributed to law enforcement agencies. The Highway Patrol also will open an investigation into the origin of the report, which linked conservative groups with domestic terrorism and named former presidential candidates Ron Paul, Bob Barr and Chuck Baldwin.


Real Clear Politics -
In a 2,000-word letter to Washington Post Co.'s shareholders, company chairman Don Graham disclosed that the news division - dominated by flagship Washington Post - lost nearly $25 million in 2008 and is expected to lose "substantially more" in 2009. Responding to the gloomy outlook, the Post announced that it will be offering voluntary buyouts - its fourth since 2003 and the first since May 2008, when more than 100 staffers took the buyouts. Graham conceded that beyond the immediate losses, he is still grasping for solutions to turn around a business that's seemingly on its deathbed.


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April 23, 2009 5:55 AM  

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