Wall St. Gets the Money and the Contracts Too

P.T. Barnum once said that there is a “sucker born every 5 minutes”.  Well, the famous hustler would have been proud of the Wall St. lobbyists and Treasury Secretary Paulson as they shook down over 300 million suckers – the American taxpayers.  Not only did they get the $700 billion of quick money, but the opportunistic Congress decided to take the opportunity to pull out their wish list and add 16 earmarks to the Bailout for an additional $140 billion dollars.  That’s right, the Bailout or should we say Rip Off totals $840 billion.  That is $2300 for every man, woman and child living in this nation.  That equates to a family of four now increasing their debt by $9200.  Congress could have been more productive just passing that money out to the citizens of America and letting Wall St. pay for its own sins.  Even “anti-earmark Sen. John McCain” went along with all of this pork.  The lobby is too strong and the perks for the cooperating legislators is too sweet.  Our Congress was bought and sold.

Now, they have the money and the world is still in the same predicament.  The economy is in the tank as much now as it was before the giveaway.  They played the stock market to scare and fake out Congress.  After the Bailout was passed many assumed the market would increase.  Silly folks – the stock market dropped over 400 points from a plus 250 to a minus 156.  We are still in the fix but only about $1 trillion deeper in debt.

They have the money and now they must steal all of the big contracts that will come as a result of the supreme hustle.  They will do this through No Bid Contracts.  This form of deception was created in the early days of Iraq and perfected during the Hurricane Katrina recovery.  No Bids and severely inflated dollar amounts for work they will find someone else to do at predatory rates.  This is done by declaring an emergency and waiving contracting law – Federal Acquisition Regulation, the FAR, thus eliminating affirmative action and minority participation requirements.

The Procurement Director for the Office of Management and Budget (OMB) declared a waiver after Katrina for 90 days.  90 days was all they needed to set all the inflated contracts for the political favorites all of whom were white.  Corruption was rampant and even the OMB Director eventually went to jail for favors he did for the infamous Jack Abramoff who is also currently in jail.

Section 107 of the Bailout allows for this:  “For purposes of this Act, the Secretary may waive specific provisions of the Federal Acquisition Regulation upon a determination that urgent and compelling circumstances make compliance with such provisions contrary to the public interest”.  Public interest hell – it is special interest such as good old white boys.  It fakes out the Congressional Black Caucus and others by further stating:  “In any solicitation or contract where the Secretary has, pursuant to subsection (a), waived any provision of the Federal Acquisition Regulation pertaining to minority contracting, the Secretary shall develop and implement standards and procedures to ensure, to the maximum extent practicable, the inclusion and utilization of minorities”.  If you believe this, then I have a bridge in Florida to sell you.  In the end, like Katrina and Iraq, there will be some fronting going on and some fake contracts but no true Black business participation.  They will find a few Alaska Native Corporations who will sign contracts as minorities but then flip all of it to white firms.  They do this in corrupt ways now and get caught from time to time.  Only this time, it will be perfectly free of prosecution because the law is waived!

The cadre of Black firms in the housing and financial business that former Secretary of HUD Alphonso Jackson developed will be totally ignored.  Normally, their contracts would be enlarged to include the new volume.  With the above waiver they can be totally ignored and they certainly will.

If Senator Obama is elected President we may have a chance at the back end of this to break off some “bones”.  However, these guys have well over 90 days (like Katrina) to set all the traps and bring in the fat contracts for their chosen few.  A contract will be for “4X dollars”.  The contractor will then go to the marketplace and find someone to do it for “2X dollars” and that person will find someone to do it for “X dollars” which is the true value of the work.  The culprits will pocket the excess.  When you deal with wholesale corruption like that via a “license to cheat and steal” Black folk need not apply. This isn’t true federal procurement it is corruption at its worse replete with pure racist vile.  The American taxpayer is the major victim and Black business will be “road kill”.

Mr. Alford is the co-founder, President/CEO of the National Black Chamber of Commerce, Inc.  Website:  www.nationalbcc.org.

When Big Capitalists Plead for Welfare  

It was an extremely sad day for those who believe in free enterprise and the fundamentals of capitalism.  Adam Smith, the author of “Wealth of Nations”, who is considered the Father of Capitalism, must have been turning in his grave.  Here was the Secretary of the US Treasury, Secretary Henry Paulson, aka King Henry, Big Willie, Iceberg Slim, coming to Congress on a Saturday morning requesting $770 billion to be handed over to his office for disposal at his discretion without court or congressional oversight, i.e. transparency.  He had the audacity to threaten us by saying give it to me now or the world economy will go into a terrible depression immediately.  Congressman Mike Pence (R-Indiana) would say, “The last time I heard something like that, I was standing in a used car lot”.  Paulson even had the guts to put it on a trifling two and one half page proposal.    The legislative leaders of the free world were being shaken down by a very rich hustler.

First of all, Secretary Paulson has a very big conflict of interest in all this.  He is the former CEO of Wall St. investment firm Goldman Sachs which is a suspect in all this mess.  In 2005, Paulson’s personal value of Goldman Sachs stock was over $800 million and today it is valued at around $500 million.  Yes, he is down to his last half a billion dollars and he wants to turn that around even if the assistance comes from American taxpayers.  The fired CEO of AIG Insurance, a major suspect in this, had a value of $1.2 billion in his company stock and today that has shrunk to less than $50 million.  They are personally in trouble and are trying to manipulate your elected officials to further the US debt and have you, the typical American taxpayer, make them whole.

Yes, I used the term “suspects”.  The reason for all of this mess is a wholesale movement of deception, greed, corruption and simple felonies.  The FBI currently has at least 26 major investigations going on in Wall St.  The major subject is mortgage fraud.  What we definitely need to do is build a couple of new prisons and send these financial criminals away.  Let’s not swat hands this time.  These federal criminals need to do some serious time and set the example that ripping off people, including Black folks, will get you locked up.

Yes, I am saying a lot of this is racial.  The major component of this economic meltdown is the mortgage fraud that was taking place.  The prime targets of the fraud were Black and Hispanic families.  Sub-prime mortgages have exploited minority home owners and they were the first to suffer.  The whole scheme backfired on the conspirators because they never figured the public would finally realize who was to blame.  In sum, Black net worth in America has probably fallen 30% due to the criminal activity of Wall St., Fannie Mae, Freddie Mac and others.  Thirty years of our wealth building has collapsed and that will hurt us for a significant time.  We have got to make them pay!

Small businesses do not have this luxury of paying off officials through Political Action Committees, lobbyists, etc.  We sink or swim based on our own accountability, business acumen and fate.  We are the true Capitalists in this time and it is us who provide 70% of all new jobs in this nation.  Big corporations are the manipulators as opposed to students of Capitalism.  They must pay for their transgressions.  I know that good government must step in but it should not be in the way of super regulation.  Heavy regulation is not the answer as it can only make things worse.  We should continue to embrace true Capitalism and, by doing that, we should prosecute those who abuse the public trust and embrace greed versus business acumen.

What Secretary Paulson and his minions didn’t count on was the fact that Congress has to answer to the American people.  Our populace is against any kind of major bailout by the ratio of 50 to 1.  Congresspersons and Senators have an election next month and they must report on this issue.  If they discount the people and go for the “big boys” their futures will be in jeopardy.  Democracy is going to make them fall onto the people’s side.  Yes, Corporate Thieves you are in serious trouble.  I guess it is time for you to “fall on your swords”.

Congress should take its time and sort this serious matter out.  Save the nation from total financial abyss but do so with no mercy to the SOB’s who got us in this mess for the simple reason of personal gain.  We don’t need more regulation we need better policing.  That way equal opportunity can take the place of greed and bias.