Thursday, September 27, 2012

Corporations Run the Economy: what was inherited from your Republican party’s years in office. Deregulation, non-enforcement, non-disclosure by the financial industry, and subsidies and bailouts were that period’s hallmarks.

Barack to Mitt


Corporations Run the Economy

by RALPH NADER

Here is an open letter that Barack Obama should write to Mitt Romney – pronto!

Dear Mr. Romney:

Not a day goes by without you blaming me for every slumping or stagnant economic indicator. Unemployment, increases in the number of food stamp recipients, government borrowing, and spending, home foreclosures, economic uncertainty for businesses, trade deficits – you name it. Only for droughts and hurricanes have you absolved me from responsibility.

I won’t go into what was inherited from your Republican party’s years in office. Deregulation, non-enforcement, non-disclosure by the financial industry, and subsidies and bailouts were that period’s hallmarks. But if I were to be held responsible for the state of the American economy, there would have to be a “command and control” economy enforced by the White House. You know full well that is not the case for several reasons.

First, our economy is dominated by corporations that make their own investment and hiring decisions. Two-thirds of the tens of millions of low-wage workers are employed by fifty large corporations, such as Walmart and McDonald’s. Thirty million American workers are laboring between the federal minimum wage of $7.25 per hour and what the minimum wage, adjusted for inflation from 1968, should be now – about $10 per hour. These companies are successfully opposing in Congress any increase in the minimum wage to such catch up with 1968. By the way, you favored an inflation-adjusted minimum wage for years. During the Republican primaries earlier this year, you changed your long-standing position and now oppose raising the minimum wage.

Moreover, many companies are sitting on more than $2 trillion in inactive cash reserves. I have no power to get more of that capital invested, other than to appeal to their USA corporate patriotism. I could also use that patriotic appeal to urge them to increase their dividends to shareholders which would pump tens of billions of dollars into our consumer economy to encourage much-needed spending. Some of these successful companies like Google, EMC and others offer no dividends at all to their owners. Those exhortations are just exhortations. CEOs can do what they want.

Second, I am not the Federal Reserve. The Fed has kept interest rates very low which has limited the return on savings. Tens of millions of middle and lower income people could spend those interest payments on the necessities of life. But the Fed is its own ruler, and its catering to the capital investment community don’t seem to be boosting the economy.

Third, there is the Congress and the oppositional unanimity by Republicans to block any economic, job-producing measures due to their priority of using a recessionary economy to help you defeat me in November. Remember Senate Republican leader, Senator Mitch McConnell’s oft-repeated words about that being their number-one priority?

I tried to promote a major public works construction and repair program in Congress. The Republicans in the House blocked it under the aegis of Representatives John Boehner and Eric Cantor. This program would have produced well-paying jobs, with multiplier effects, that could not be exported to China. Our communities have trillions of dollars in deferred maintenance afflicting schools, clinics, public transit systems, highways, bridges, dams, and water and sewage systems. I cannot make this happen without the Republicans in Congress. You and your running mate, Paul Ryan, have not exactly urged them to take up this jobs initiative.

You have declared that “Washington has become an impediment to economic growth.” Why then don’t you be specific, name and support an end to the vast array of corporate subsidies, handouts, bailouts and inflated government contracts, especially from the defense industry? Imagine what your friends on Wall Street and in Houston would think of you after that burst of candor.

See how many jobs disappear with the end of what conservatives call crony capitalism, the end of the huge, historic outpourings of government research and development monies that substantially built and help maintain innovations in the aerospace, biotech, pharmaceutical, computer, telecommunications and containerization industries – to name a few. And if you think taxpayer investment in public works all over the country is an “impediment to economic growth,” say so forthrightly, as you campaign battleground states.

I look forward to our first debate on October 3 in Denver and shall observe your struggle with consistency. While you’re at it, kindly bring your pre-2010 tax returns, so we can learn more about what you mean when you talk about your policy of tax cuts.

In solidarity for America,

Barack Obama, President

Ralph Nader is a consumer advocate, lawyer and author of Only the Super-Rich Can Save Us! He is a contributor to Hopeless: Barack Obama and the Politics of Illusion, published by AK Press. Hopeless is also available in a Kindle edition.



In 2010, compelling forensic evidence emerged showing that the Federal Bureau of Investigation (FBI) and the Counter Intelligence Program (COINTELPRO) were the lead agencies in managing Kent State government operations, including the cover-up. At Kent State, lawful protest was pushed into the realm of massacre as the US federal government, the state of Ohio, and the Ohio National Guard (ONG) executed their plans to silence antiwar protest in America.

Was It About Civil Rights Or
Murdering Student Protesters?

Uncovering the Kent State Cover-Up

by LAUREL KRAUSE & MICKEY HUFF

When Ohio National Guardsmen fired sixty-seven gun shots in thirteen seconds at Kent State University (KSU) on May 4, 1970, they murdered four unarmed, protesting college students and wounded nine others. For forty-two years, the United States government has held the position that Kent State was a tragic and unfortunate incident occurring at a noontime antiwar rally on an American college campus. In 2010, compelling forensic evidence emerged showing that the Federal Bureau of Investigation (FBI) and the Counter Intelligence Program (COINTELPRO) were the lead agencies in managing Kent State government operations, including the cover-up. At Kent State, lawful protest was pushed into the realm of massacre as the US federal government, the state of Ohio, and the Ohio National Guard (ONG) executed their plans to silence antiwar protest in America.



The new evidence threatens much more than the accuracy of accounts of the Kent State massacre in history books. As a result of this successful, ongoing Kent State government cover-up, American protesters today are at much greater risk than they realize, with no real guarantees or protections offered by the US First Amendment rights to protest and assemble. This chapter intends to expose the lies of the state in order to uncensor the “unhistory” of the Kent State massacre, while also aiming toward justice and healing, as censoring the past impacts our perspectives in the present.



The killing of protesters at Kent State changed the minds of many Americans about the role of the US in the Vietnam War. Following this massacre, there was an unparalleled national response: hundreds of universities, colleges, and high schools closed across America in a student strike of more than four million. Young people across the nation had strong suspicions the Kent State massacre was planned to subvert any further protests arising from the announcement that the already controversial war in Vietnam had expanded into Cambodia.



Yet instead of attempting to learn the truth at Kent State, the US government took complete control of the narrative in the press and ensuing lawsuits. Over the next ten years, authorities claimed there had not been a command-to-fire at Kent State, that the ONG had been under attack, and that their gunfire had been prompted by the “sound of sniper fire.” Instead of investigating Kent State, the American leadership obstructed justice, obscured accountability, tampered with evidence, and buried the truth. The result of these efforts has been a very complicated government cover-up that has remained intact for more than forty years.1



The hidden truth finally began to emerge at the fortieth anniversary of the Kent State massacre in May 2010, through the investigative journalism of John Mangels, science writer at the Cleveland Plain Dealer, whose findings supported the long-held suspicion that the four dead in Ohio were intentionally murdered at Kent State University by the US government.



Mangels commissioned forensic evidence expert Stuart Allen to professionally analyze a tape recording made from a Kent State student’s dormitory window ledge on May 4, 1970, forever capturing the crowd and battle sounds from before, during, and after the fusillade.2 For the first time since that fateful day, journalists and concerned Americans were finally able to hear the devastating soundtrack of the US government murdering Kent State students as they protested against the Vietnam War.



The cassette tape—provided to Mangels by the Yale University Library, Kent State Collection, and housed all these years in a box of evidence admitted into lawsuits led by attorney Joseph Kelner in his representation of the Kent State victims—was called the “Strubbe tape” after Terry Strubbe, the student who made the recording by placing a microphone attached to a personal recorder on his dormitory window ledge. This tape surfaced when Alan Canfora, a student protester wounded at Kent State, and researcher Bob Johnson dug through Yale library’s collection and found a CD copy of the tape recording from the day of the shootings. Paying ten dollars for a duplicate, Canfora then listened to it and immediately knew he probably held the only recording that might provide proof of an order to shoot. Three years after the tape was found, the Plain Dealer commendably hired two qualified forensic audio scientists to examine the tape.



But it is really the two pieces of groundbreaking evidence Allen uncovered that illuminate and provide a completely new perspective into the Kent State massacre.



First, Allen heard and verified the Kent State command-to-fire spoken at noon on May 4, 1970. The command-to-fire has been a point of contention, with authorities stating under oath and to media for forty years that “no order to fire was given at Kent State,” that “the Guard felt under attack from the students,” and that “the Guard reacted to sniper fire.”3 Yet Allen’s verified forensic evidence of the Kent State command-to-fire directly conflicts with guardsmen testimony that they acted in self-defense.



The government claim—that guardsmen were under attack at the time of the ONG barrage of bullets—has long been suspect, as there is nothing in photographic or video records to support the “under attack” excuse. Rather, from more than a football field away, the Kent State student protesters swore, raised their middle fingers, and threw pebbles and stones and empty tear gas canisters, mostly as a response to their campus being turned into a battlefield with over 2,000 troops and military equipment strewn across the Kent State University campus.



Then at 12:24 p.m., the ONG fired armor-piercing bullets at scattering students in a parking lot—again, from more than a football field away. Responding with armor-piercing bullets, as Kent State students held a peaceful rally and protested unarmed on their campus, was the US government’s choice of action.



The identification of the “commander” responsible for the Kent State command-to-fire on unarmed students has not yet been ascertained. This key question will be answered when American leadership decides to share the truth of what happened, especially as the Kent State battle was under US government direction. Until then, the voice ordering the command-to-fire in the Kent State Strubbe tape will remain unknown.



The other major piece of Kent State evidence identified in Allen’s analysis was the “sound of sniper fire” recorded on the tape. These sounds point to Terry Norman, FBI informant and provocateur, who was believed to have fired his low-caliber pistol four times, just seventy seconds before the command-to-fire.



Mangels wrote in the Plain Dealer, “Norman was photographing protestors that day for the FBI and carried a loaded .38-caliber Smith & Wesson Model . . . five-shot revolver in a holster under his coat for protection. Though he denied discharging his pistol, he previously has been accused of triggering the Guard shootings by firing to warn away angry demonstrators, which the soldiers mistook for sniper fire.”4



Video footage and still photography have recorded the minutes following the “sound of sniper fire,” showing Terry Norman sprinting across the Kent State commons, meeting up with Kent Police and the ONG. In this visual evidence, Norman immediately yet casually hands off his pistol to authorities and the recipients of the pistol show no surprise as Norman hands them his gun.5



The “sound of sniper fire” is a key element of the Kent State cover-up and is also referred to by authorities in the Nation editorial, “Kent State: The Politics of Manslaughter,” from May 18, 1970:



“The murders occurred on May 4. Two days earlier, [Ohio National Guard Adjutant General] Del Corso had issued a statement that sniper fire would be met by gunfire from his men. After the massacre, Del Corso and his subordinates declared that sniper fire had triggered the fusillade.6



Yet the Kent State “sound of sniper fire” remains key, according to White House Chief of Staff Bob Haldeman, who noted President Richard Nixon’s reaction to Kent State in the Oval Office on May 4, 1970:



“Chief of Staff Bob Haldeman told him [of the killings] late in the afternoon. But at two o’clock Haldeman jotted on his ever-present legal pad “keep P. filled in on Kent State.” In his daily journal Haldeman expanded on the President’s reaction: “He very disturbed. Afraid his decision set it off . . . then kept after me all day for more facts. Hoping rioters had provoked the shootings—but no real evidence that they did.” Even after he had left for the day, Nixon called Haldeman back and among others issued one ringing command: “need to get out story of sniper.”7



In a May 5, 1970, article in the New York Times, President Nixon commented on violence at Kent State:



This should remind us all once again that when dissent turns to violence it invites tragedy. It is my hope that this tragic and unfortunate incident will strengthen the determination of all the nation’s campuses, administrators, faculty and students alike to stand firmly for the right which exists in this country of peaceful dissent and just as strong against the resort to violence as a means of such expression.8



President Nixon’s comment regarding dissent turning to violence obfuscated and laid full blame on student protesters for creating violence at Kent State. Yet at the rally occurring on May 4th, student protester violence amounted to swearing, throwing small rocks, and volleying back tear gas canisters, while the gun-toting soldiers of the ONG declared the peace rally illegal, brutally herded the students over large distances on campus, filled the air with tear gas, and even threw rocks at students. Twenty minutes into the protest demonstration, a troop of National Guard marched up a hill away from the students, turned to face the students in unison, and fired.



The violence at Kent State came from the National Guardsmen, not protesting students. On May 4, 1970, the US government delivered its deadly message to Kent State students and the world: if you protest in America against the wars of the Pentagon and the Department of Defense, the US government will stop at nothing to silence you.



Participating American militia colluded at Kent State to organize and fight this battle against American student protesters, most of them too young to vote but old enough to fight in the Vietnam War.9 And from new evidence exposed forty years after the massacre, numerous elements point directly to the FBI and COINTELPRO (Counter Intelligence Program) as lead agencies managing the government operation of the Kent State massacre, including the cover-up, but also with a firm hand in some of the lead-up.



Prior to the announcement of the Cambodian incursion, the ONG arrived in the Kent area acting in a federalized role as the Cleveland-Akron labor wildcat strikes were winding down. The ONG continued in the federalized role at Kent State, ostensibly to protect the campus and as a reaction to the burning of a Reserve Officers’ Training Corps (ROTC) building. Ohio Governor James “Jim” Rhodes claimed the burning of the ROTC building on the Kent State University campus was his reason for “calling in the guard,” yet in this picture of the burning building, the ONG are clearly standing before the flames as the building burns.10



From eyewitness accounts, the burning of the ROTC building at Kent State was completed by undercover law enforcement determined to make sure it could become the symbol needed to support the Kent State war on student protest.11



According to Dr. Elaine Wellin, an eyewitness to the many events at Kent State leading up to and including May 4th, there were uniformed and plain-clothes officers potentially involved in managing the burning of the ROTC building. Wellin was in close proximity to the building just prior to the burning and saw a person with a walkie-talkie about three feet from her telling someone on the other end of the communication that they should not send down the fire truck as the ROTC building was not on fire yet.12



A memo to COINTELPRO director William C. Sullivan ordered a full investigation into the “fire bombing of the ROTC building.” But only days after the Kent State massacre, every weapon that was fired was destroyed, and all other weapons used at Kent State were gathered by top ONG officers, placed with other weapons and shipped to Europe for use by North Atlantic Treaty Organization (NATO), so no weapons used at Kent could be traced.



From these pieces of evidence, it becomes clearer that the US government coordinated this battle against student protest on the Kent State campus. Using the playbook from the Huston Plan, which refers to protesting students as the “New Left,” the US government employed provocateurs, staged incidents, and enlisted political leaders to attack and lay full blame on the students. On May 4, 1970, at Kent State University, the US government fully negated every student response as they criminalized the First Amendment rights to protest and assemble.13



The cover-up adds tremendous complexity to an already complicated event, making it nearly impossible to fairly try the Kent State massacre in the American justice system. This imposed “establishment” view that Kent State was about “civil rights”—and not about murder or attempted murder—led to a legal settlement on the basis of civil rights lost, with the US government consistently refusing to address the death of four students and the wounding of nine.14



Even more disheartening, efforts to maintain the US government cover-up at Kent State recently went into overdrive in April 2012, when President Barack Obama’s Department of Justice (DOJ) formally announced a refusal to open a new probe into the wrongs of Kent State, continuing the tired 1970 tactic of referring to Kent State as a civil rights matter.15



The April 2012 DOJ letters of response also included a full admission that, in 1979, after reaching the Kent State civil rights settlement, the FBI Cleveland office destroyed what they considered a key piece of evidence: the original tape recording made by Terry Strubbe on his dormitory window ledge. In a case involving homicides, the FBI’s illegal destruction of evidence exposes their belief to be “above the law,” ignoring the obvious fact that four students were killed on May 4, 1970. As the statute of limitations never lapses for murder, the FBI’s actions went against every law of evidence. The laws clearly state that evidence may not be destroyed in homicides, even when the murders are perpetrated by the US government.



The destruction of the original Strubbe tape also shows the FBI’s intention to obstruct justice: the 2012 DOJ letters on Kent State claim that, because the original Strubbe tape was intentionally destroyed, the copy examined by Allen cannot be compared to the original or authenticated. However the original Strubbe tape, destroyed by the DOJ, was never admitted into evidence.



The tape examined by Stuart Allen, however, is a one-to-one copy of the Kent State Strubbe tape admitted into evidence in Kent State legal proceedings by Joseph Kelner, the lawyer representing the victims of Kent State. Once an article has been admitted into evidence, the article is considered authentic evidentiary material.



Worse than this new smokescreen on the provenance of the Kent State Strubbe tape and FBI efforts to destroy evidence is that the DOJ has wholly ignored or refuted the tremendous body of forensic evidence work accomplished by Allen, and verified by forensic expert Tom Owen.16 If the US Department of Justice really wanted to learn the truth about what happened at Kent State and was open to understanding the new evidence, DOJ efforts would include organizing an impartial examination of Allen’s analysis and contacting him to present his examination of the Kent State Strubbe tape. None of this has happened.



Instead, those seeking justice through a reexamination of the Kent State historical record based on new evidence have been left out in the cold. Congressman Dennis Kucinich, involved in Kent State from the very beginning as a Cleveland city council person, asked important questions in a letter to the DOJ on April 24, 2012, titled, “Analysis of Audio Record of Kent State Shooting Leaves Discrepancies and Key Questions Unaddressed”:



“While I appreciate the response from the Justice Department, ultimately, they fail to examine key questions and discrepancies. It is well known that an FBI informant, Terry Norman, was on the campus. That FBI informant was carrying a gun. Eyewitnesses testified that they saw Mr. Norman brandish that weapon. Two experts in forensic audio, who have previously testified in court regarding audio forensics, found gunshots in their analysis of the audio recording. Did an FBI informant discharge a firearm at Kent State? Did an FBI informant precipitate the shootings?



Who and what events led to the violent encounter that resulted in four students dead and nine others injured? What do the FBI files show about their informant? Was he ever debriefed? Has he been questioned to compare his statement of events with new analysis? How, specifically, did the DOJ analyze the tape? How does this compare to previous analysis conducted by independent sources that reached a different conclusion? The DOJ suggested noises heard in the recording resulted from a door opening and closing. What tests were used to make that determination? Was an independent agency consulted in the process?



For more than a year, I have pushed for an analysis of the Strubbe tape because Kent State represented a tragedy of immense proportions. The Kent State shooting challenged the sensibilities of an entire generation of Americans. This issue is too important to ignore. We must demand a full explanation of the events.17



Concerned Americans may join Congressman Kucinich in demanding answers to these questions and in insisting on an independent, impartial organization—in other words, not the FBI—to get to the bottom of this.



The FBI’s cloudy involvement includes questions about Terry Norman’s relationship to the FBI, addressed in Mangels’s article, “Kent State Shootings: Does Former Informant Hold the Key to the May 4th Mystery?”:



“Whether due to miscommunication, embarrassment or an attempted cover-up, the FBI initially denied any involvement with Norman as an informant.



“Mr. Norman was not working for the FBI on May 4, 1970, nor has he ever been in any way connected with this Bureau,” director J. Edgar Hoover declared to Ohio Congressman John Ashbrook in an August 1970 letter.



Three years later, Hoover’s successor, Clarence Kelley, was forced to correct the record. The director acknowledged that the FBI had paid Norman $125 for expenses incurred when, at the bureau’s encouragement, Norman infiltrated a meeting of Nazi and white power sympathizers in Virginia a month before the Kent State shootings.18



Even more telling, Norman’s pistol disappeared from a police evidence locker and was completely retooled to make sure that the weapon—used to create the “sound of sniper fire” on May 4—would not show signs of use. Indeed, every “investigation” into Kent State shows that the FBI tampered, withheld, and destroyed evidence, bringing into question government involvement in both the premeditated and post-massacre efforts at Kent State. In examining all inquiries into Kent State, an accurate investigation has never occurred, as the groups involved in the wrongs of Kent State have been investigating themselves.19



The Kent State students never had a chance against the armed will of the US government in its aim to fight wars in Vietnam, Cambodia, and Laos back in 1970. Further, the First Amendment rights to protest and assemble have shown to be only vacuous platitudes. Forty-two years later, the Obama administration echoes the original drone of the US government denying the murder of protesters, pointing only to civil rights lost. When bullets were fired on May 4th at Kent State, US government military action against antiwar protesters on domestic soil changed from a civil rights breach to acts of murder and attempted murder.



Congressman Kucinich, in an interview with Pacifica Radio after his exchanges with DOJ by May of 2012, said,



There are some lingering questions that could change the way that history looks at what happened at Kent State. And I think that we owe it to the present generation of Americans, the generation of Americans that came of age during Kent, the students on campus, we owe it to the Guardsmen, who it was said opened fire without any provocation what so ever  … we have to get to the truth.20



As long as American leadership fails to consider killing protesters a homicidal action and not just about civil rights lost, there is little safety for American protesters today, leaving the door wide open for more needless and unnecessary bloodshed and possibly the killing of American protesters again. This forty-two-year refusal to acknowledge the death of four students relates to current US government practices toward protest and protesters in America, as witnessed at Occupy Wall Street over the past year. When will it ever become legal to protest and assemble in America again? Will American leadership cross the line to kill American protesters again?21



In a rare editorial addressing this issue, journalist Stephen Rosenfeld of AlterNet wrote,



“History never exactly repeats itself. But its currents are never far from the present. As today’s protesters and police employ bolder tactics, the Kent State and Jackson State anniversaries should remind us that deadly mistakes can and do happen. It is the government’s responsibility to wield proportionate force, not to over-arm police and place them in a position where they could panic with deadly results.22



Though forty-two years have passed, the lessons of Kent State have not yet been learned.



No More Kent States



In 2010, the United Kingdom acknowledged the wrongs of Bloody Sunday, also setting an example for the US government to learn the important lessons of protest and the First Amendment.23 In January 1972, during “Bloody Sunday,” British paratroopers shot and killed fourteen protesters; most of the demonstrators were shot in the back as they ran to save themselves.24



Thirty-eight years after the Bloody Sunday protest, British Prime Minister David Cameron apologized before Parliament, formally acknowledging the wrongful murder of protesters and apologized for the government.25 The healing in Britain has begun. Considering the striking similarity in events where protesters were murdered by the state, let’s examine the wrongs of Kent State, begin to heal this core American wound, and make a very important, humane course correction for America. When will it become legal to protest in America?



President Obama, the Department of Justice, and the US government as a whole must take a fresh look at Stuart Allen’s findings in the Kent State Strubbe tape. The new Kent State evidence is compelling, clearly showing how US covert intelligence took the lead in creating this massacre and in putting together the ensuing cover-up.



As the United States has refused to examine the new evidence or consider the plight of American protest in 2012, the Kent State Truth Tribunal formally requested the International Criminal Court (ICC) at the Hague consider justice at Kent State.26



Who benefited the most from the murder of student protesters at Kent State? Who was really behind the Kent State massacre? There is really only one US agency that clearly benefited from killing student antiwar protesters at Kent State: the Department of Defense.



Since 1970 through 2012, the military-industrial-cyber complex strongly associated with the Department of Defense and covert US government agencies have actively promoted never-ending wars with enormous unaccounted-for budgets as they increase restrictions on American protest. These aims of the Pentagon are evidenced today in the USA PATRIOT Act, the further civil rights–limiting National Defense Authorization Act (NDAA), and new war technologies like CIA drones.



Probing the dark and buried questions of the Kent State massacre is only a beginning step to shine much-needed light on the United States military and to illuminate how the Pentagon has subverted American trust and safety, as it endeavors to quell domestic protest against war at any cost since at least 1970.



LAUREL KRAUSE a writer and truth seeker dedicated to raising awareness about ocean protection, safe renewable energy, and truth at Kent State. She publishes a blog on these topics at Mendo Coast Current. She is the cofounder and director of the Kent State Truth Tribunal. Before spearheading efforts for justice for her sister Allison Krause, who was killed at Kent State University on May 4, 1970, Laurel worked at technology start-ups in Silicon Valley.



MICKEY HUFF is the director of Project Censored and professor of social science and history at Diablo Valley College. He did his graduate work in history on historical interpretations of the Kent State shootings and has been actively researching the topic more since his testimony to the Kent State Truth Tribunal in New York City in 2010.



Notes

1. For more background on Kent State and the many conflicting interpretations, see Scott L. Bills, Kent State/May 4: Echoes Through a Decade (Kent OH: Kent State University Press, 1982). Of particular interest for background on this chapter, see Peter Davies, “The Burning Question: A Government Cover-up?,” in Kent State/May 4, 150–60. For a full account of Davies’s work, see The Truth About Kent State: A Challenge to the American Conscience (New York: Farrar, Straus & Giroux, 1973). For a listing of other works see Selected Bibliography on the Events of May 4, 1970, at Kent State University, http://dept.kent.edu/30yearmay4/source/bib.htm.

2. John Mangels, “New Analysis of 40-Year-Old Recording of Kent State Shootings Reveals that Ohio Guard was Given an Order to Prepare to Fire,” Plain Dealer (Cleveland), May 9, 2010, updated April 23, 2012, http://blog.cleveland.com/metro/2010/05/new_analysis_of_40-year-old_re.html; Interview with Stuart Allen analyzing new evidence who said of the efforts, “It’s about setting history right.” See the footage “Kent State Shootings Case Remains Closed,” CNN, added April 29, 2012, http://www.cnn.com/video/?/video/us/2012/04/29/justice-department-will-not-reopen-kent-state-shootings-case.cnn.

3. Submitted for the Congressional Record by Representative Dennis Kucinich, “Truth Emerging in Kent State Cold Case Homicide,” by Laurel Krause, http://thomas.loc.gov/cgi-bin/query/z?r111%3AE14DE0-0019%3A. For a brief introduction on the history and emerging historiography of the Kent State shootings, see Mickey S. Huff, “Healing Old Wounds: Public Memory, Commemoration, and Conflicts Over Historical Interpretations of the Kent State Shootings, 1977–1990,” master’s thesis, Youngstown State University, December 1999, http://etd.ohiolink.edu/view.cgi?acc_num=ysu999620326.

For the official government report, see The Report of the President’s Commission on Campus Unrest (Washington: US Government Printing Office, 1970), also known as the Scranton Commission. It should be noted that the Scranton Commission stated in their conclusion between pages 287 and 290 that the shootings were “unnecessary, unwarranted and inexcusable” but criminal wrongdoing was never established through the courts and no one was ever held accountable for the shootings. Also, it should be noted, that the interpretation that the guard was ordered to fire conflicts with Davies’s interpretation, in note 1 here, that even though he believes there was a series of cover-ups by the government, he has not attributed malice. For more on the Kent State cover-ups early on, see I. F. Stone, “Fabricated Evidence in the Kent State Killings,” New York Review of Books, December 3, 1970, http://www.nybooks.com/articles/archives/1970/dec/03/fabricated-evidence-in-the-kent-state-killings.

4. Mangels, “Kent State Tape Indicates Altercation and Pistol Fire Preceded National Guard Shootings (audio),” Plain Dealer (Cleveland), October 8, 2010, http://www.cleveland.com/science/index.ssf/2010/10/analysis_of_kent_state_audio_t.html.

5. Kent State Shooting 1970 [BX4510], Google Video, at 8:20 min., http://video.google.com/videoplay?docid=-3727445416544720642.

6. Editorial, “Kent State: The Politics of Manslaughter,” Nation, April 30, 2009 [May 18, 1970], http://www.thenation.com/article/kent-state-politics-manslaughter.

7. Charles A. Thomas, Kenfour: Notes On An Investigation (e-book), http://speccoll.library.kent.edu/4may70/kenfour3.

8. John Kifner, “4 Kent State Students Killed by Troops,” New York Times, May 4, 1970, http://www.nytimes.com/learning/general/onthisday/big/0504.html#article.

9. Voting age was twenty-one at this time, until the passage of the Twenty-Sixth Amendment to the US Constitution in 1971, which lowered the voting age to eighteen, partially in response to Vietnam War protests as youth under twenty-one could be drafted without the right to vote.

10. It should also be noted, that Rhodes was running for election the Tuesday following the Kent shootings on a law and order ticket.

11. “My Personal Testimony ROTC Burning May 2 1970 Kent State,” YouTube, April 28, 2010, http://www.youtube.com/watch?v=6ppBkB4caY0&feature=youtu.be; Freedom of Information Act, FBI, Kent State Shooting, File Number 98-46479, part 7 of 8 (1970), http://vault.fbi.gov/kent-state-shooting/kent-state-shooting-part-07-of-08/view.

12. The Project Censored Show on The Morning Mix, “May 4th and the Kent State Shootings in the 42nd Year,” Pacifica Radio, KPFA, 94.1FM, May 4, 2012 live at 8:00 a.m., archived online at http://www.kpfa.org/archive/id/80293 and http://dl.dropbox.com/u/42635027/20120504-Fri0800.mp3. For Wellin on ROTC, see recording at 28:45.

Show description: The May 4th Kent State Shootings 42 Years Later: Justice Still Not Served with Congressman Dennis Kucinich commenting on the DOJ’s recent refusal to reopen the case despite new evidence of a Kent State command-to-fire and the ‘sound of sniper fire’ leading to the National Guard firing live ammunition at unarmed college students May 4, 1970; Dr. Elaine Wellin, Kent State eyewitness shares seeing undercover agents at the ROTC fire in the days before, provocateurs in staging the rallies at Kent, and at Kent State on May 4th; we’ll hear from investigator and forensic evidence expert Stuart Allen regarding his audio analysis of the Kent State Strubbe tape from May 4th revealing the command-to-fire and the ‘sound of sniper fire’ seventy seconds before; and we hear from Kent State Truth Tribunal director Laurel Krause, the sister of slain student Allison, about her efforts for justice at Kent State and recent letter to President Obama..

Also see Peter Davies’ testimony about agents provocateurs and the ROTC fire cited in note 1, “The Burning Question: A Government Cover-up?,” in Kent State/May 4, 150–60.

13. The Assassination Archives and Research Center (AARC), “Volume 2: Huston Plan,” http://www.aarclibrary.org/publib/contents/church/contents_church_reports_vol2.htm.

14. Associated Press, “Kent State Settlement: Was Apology Included?,” Eugene Register-Guard, January 5, 1979, http://news.google.com/newspapers?nid=1310&dat=19790105&id=xvJVAAAAIBAJ&sjid=BuIDAAAAIBAJ&pg=3696,963632.

15. Mangels, “Justice Department Won’t Reopen Probe of 1970 Kent State Shootings,” Plain Dealer (Cleveland), April 24, 2012, http://www.cleveland.com/science/index.ssf/2012/04/justice_department_wont_re-ope.html; and kainah, “Obama Justice Dept.: No Justice for Kent State,” Daily Kos, May 2, 2012, http://www.dailykos.com/story/2012/05/02/1086726/-Justice-Dept-No-Justice-for-Kent-State.

16. Mangels, “New Analysis.”

17. Letters between the Department of Justice and Representative Dennis Kucinich, archived at the Congressman’s website, April 20 and April 24 of 2012, http://kucinich.house.gov/uploadedfiles/kent_state_response_from_doj.pdf and http://kucinich.house.gov/news/documentsingle.aspx?DocumentID=292306.

18. Mangels, “Kent State Shootings: Does Former Informant Hold the Key to the May 4 Mystery?,” Plain Dealer (Cleveland), December 19, 2010, http://www.cleveland.com/science/index.ssf/2010/12/kent_state_shootings_does_form.html.

19. Freedom of Information Act, FBI.

20. The Project Censored Show on The Morning Mix, “May 4th and the Kent State Shootings in the 42nd Year.”

21. Steven Rosenfeld, “Will a Militarized Police Force Facing Occupy Wall Street Lead to Another Kent State?,” AlterNet, May 3, 2012, http://www.alternet.org/rights/155270.

22. Ibid.

23. Laurel Krause, “No More Kent States,” Mendo Coast Current, April 21, 2012, http://mendocoastcurrent.wordpress.com/2012/04/21/13-day-for-kent-state-peace.

24. Laurel Krause, “Unjustified, Indefensible, Wrong,” Mendo Coast Current, September 13, 2010, http://mendocoastcurrent.wordpress.com/2010/09/13/unjustified-indefensible-wrong.

25. Associated Press, “Bloody Sunday Report Blames British Soldiers Fully,” USA Today, June 15, 2010, http://www.usatoday.com/news/world/2010-06-15-Bloody-Sunday-Ireland_N.htm; and Cameron’s direct quote from Henry McDonald, Owen Bowcott, and HĂ©lène Mulholland, “Bloody Sunday Report: David Cameron Apologises for ‘Unjustifiable’ Shootings,” Guardian, June 15, 2010, http://www.guardian.co.uk/uk/2010/jun/15/bloody-sunday-report-saville-inquiry.

26. Laurel Krause, “To the Hague: Justice for the May 4th Kent State Massacre?,” Mendo Coast Current, May 7, 2012, http://mendocoastcurrent.wordpress.com/2012/05/07/may-4th-kent-state-massacre-a-call-for-truth-justice; for more on the Kent State Truth Tribunal, see www.TruthTribunal.org.



The banks are again in a position where they can skim profits off bad loans to every Tom, Dick and Harry that can sit upright and sign on the dotted line. They don’t have to worry about holding capital against their dodgy assets or whether Uncle Sam is going to get fleeced on the bogus $400,000 loan they issued to that unemployed landscaper living on food stamps. No worries. They’ve covered all the bases.

Skimming Profits Off Bad Loans

Bankers And Their Dirty Tricks

by MIKE WHITNEY


Didn’t Ben Bernanke promise that another round of bond purchases would lower unemployment and boost economic growth?

We think he did, which is why we’re wondering why all the benefits from QE3 appear to be going to the banks. According to Bloomberg News:

“The Federal Reserve’s latest mortgage bond purchases so far are helping profit margins at lenders including Wells Fargo & Co. (WFC) and JPMorgan Chase & Co. (JPM) more than homebuyers and property owners looking to refinance…

Since the Fed’s Sept. 13 announcement that it would buy $40 billion more securities per month, the rates offered for new 30- year loans have fallen by just 0.11 percentage point, compared with a drop of more than 0.6 percentage point for yields on the bonds into which the loans get packaged.” (“Fed Helps Lenders’ Profit More Than Homebuyers:Mortgages”, Bloomberg)

Well, how do you like that? That means that Mr. Bernanke’s trickle down monetary theories aren’t really working at all. Instead of the savings being passed along to homeowners in the form of lower rates, the banks are juicing profits by taking a bigger share for themselves. Who could have known?

Keep in mind, that Bernanke is not some madcap scientist who doesn’t fully grasp how QE works. That’s not it at all, in fact, he’s considered one of the world’s foremost authorities on the topic and has written extensively on Japan’s deflationary woes and their “broken channels of monetary transmission”, which is shorthand for saying that loading the banks with trillions of dollars in reserves won’t do a blasted thing except pump a little ether into stock prices. (which it has done in the last 2 rounds of easing) So, Bernanke’s been down this road before. He knows what QE will do and what it won’t do, which is why he instructed members from the Bank of Japan (BOJ) to implement fiscal-monetary policies that would have a chance of succeeding. His advice was: “BOJ purchases of government debt could support spending programs, to facilitate industrial restructuring.”

Now there’s an idea. Have the Fed buy the bonds that pay for the programs that put people back to work. Brilliant! Once the new workers get their weekly paycheck, it’s off to the grocery store, the gas station, the mall etc. Spending increases, state revenues soar, and the economy clicks back into high-gear. Simple, right? So, why are we still fiddling with this crackpot QE-circlejerk that does nothing but line the pockets of crooked bankers? That’s the question.

In theory, quantitative easing is supposed to lower interest rates and spur investment. That boosts activity and reduces joblessness. But according to a survey conducted by Duke University, the CFO’s of 887 large companies found that lower interest rates wouldn’t really effect their decisions. Here’s a summary:

According to the Duke University analysts:

“CFOs believe that … monetary action would not be particularly effective. Ninety-one percent of firms say they would not change their investment plans even if interest rates dropped by 1 percent, and 84 percent said they would not change investment plans if interest rates dropped by 2 percent.(“Currency war warnings follow US Fed’s “quantitative easing”, Nick Beams, World Socialist Web Site)

Of course it won’t change their investment plans, because what businessmen care about is demand. Who’s going to buy their bloody widgets, that’s what matters to them, not interest rates. Right now, there’s no demand for more widgets because unemployment is high, wages are flatlining, and policymakers have turned off the fiscal stimulus-spigot in an effort to shrink the economy so they can pursue their lunatic idea of dismantling public services and social programs. (mainly Medicare, Medicaid, and Social Security, the “real targets.”)

The point is, spending has to increase to get the economy off the canvas, and the only party that has money to spend is the government. So, Obama should be spending like crazy. The Central Bank cannot fix this problem with its wacko printing spree.

So, what else are the banks up to besides keeping rates elevated so they can make a bigger killing on refis?

Well, for one thing, they’re using their high-powered attorneys and lobbyists to twist arms at the Federal Housing Finance Agency (FHFA) to make it easier for them to make bad loans without suffering any consequences.

How can that be, after all, wasn’t it bad loans that got us into this mess to begin with?

Yes, it was. Even so, the banks are back at it again, up to their same old tricks. Here’s the story from Reuters:

“Just four years after toxic U.S. mortgages brought the global financial system to its knees and triggered the deepest recession since the Great Depression, a U.S. housing regulator may be making it easier for banks to make bad loans without suffering losses.

The Federal Housing Finance Agency released a little-noticed rule last week that makes it harder for Fannie Mae (FNMA.OB) and Freddie Mac (FMCC.OB) – the government-owned companies that guarantee home loans made by banks – to hold lenders accountable when mortgages go bad.

Some experts said the new rules show that lessons of the housing crisis are already being forgotten, and could set up taxpayers for tens of billions of dollars of losses if the lending bubble re-inflates later in the credit cycle.

At issue is when Fannie Mae and Freddie Mac can press banks to make them whole when mortgages go bad.” (“Housing regulators loosen rules, but at what cost?”, Reuters)

Can you believe it? The FHFA is actually accepting responsibility for mortgages where the underwriting was either shoddy or fraudulent. This is the kind of power the banks have. The agency is also assuring that the banks will create more of these garbage loans now that they know that Uncle Sam will be picking up the tab. That’s what you call “bad incentives”! Up to now, the FHFA had been able to force the banks to repurchase the loans that showed “substantive underwriting and documentation deficiencies”. But that’s not going to happen anymore. The looser rules mean that the banks will return to their old ways and that future losses to taxpayers will tally in the hundreds of billions of dollars. According to Joseph Mason, a professor at Louisiana State University’s business school, “Fannie Mae and Freddie Mac could lose even more than they did this time around.” (Fannie and Freddie have already cost taxpayers $188 billion)

To repeat, the banks had changed their behavior because they were afraid of having to repurchase the dodgy loans they originated. (These returned mortgages are called “put-backs”) Now the rules are being tweaked so the banks can shrug off the bad loans for which they are alone responsible. Here’s more from the National Association of Realtors:

“The federal government is taking steps to ease a problem lenders have been complaining about for several years, and that’s the buy-back risk they face if they underwrite a federally backed loan that goes bad and the guarantor of the loan—whether FHA, Fannie Mae or Freddie Mac—determines that the loan was never underwritten in compliance with their “representation and warranty” requirements….

…lenders remain concerned about the risk they face, and in fact earlier this year, in February, Bank of America announced it would stop selling loans to Fannie Mae because of its concerns over the company’s buy-back policies. (“FHFA Gives Banks Reason to Revisit Overlays”, National Association of Realtors)

So B of A is threatening to “stop selling loans to Fannie Mae”? Hurt me some more.

What’s more important, is that the regulators had fixed this problem by imposing penalties on the lenders, but now they’ve backtracked and undone their progress. Now it’s business as usual where the taxpayer-pinata get’s clobbered with more toxic loans. Oh good.

And that’s not all the banks are up to. They’re also fighting “risk retention” rules because they don’t want to pony-up the small amount of capital (5 percent of the loan’s value) on high-risk mortgages that go into securitizations. It’s like an insurance company refusing to keep money on hand to pay off claims. If you think that’s fair, then you should probably be a banker. Now get a load of this excerpt from a “Letter to Bernanke on QE3″ from Moe Veissi, president of the National Association of Realtors:

“Reducing mortgage interest rates in general through MBS purchases will have diminished impact if three important rules counter the availability of mortgage credit. As you have noted, mortgage credit is already tight. A recent survey of NAR members indicates that 53 percent of loans in August went to borrowers with credit scores over 740. To put this in perspective, only 41 percent of loans backed by Fannie Mae in 2001 had scores above 740. If the forthcoming Ability to Repay/Qualified Mortgage (QM), Risk Retention/Qualified Residential Mortgage (QRM), and Basel III rules only serve to further tighten credit, the impact of QE3 is likely to be diminished and only felt among those of substantial wealth and pristine credit. In short, those who need access to affordable credit the least.

While the Federal Reserve (The Fed) is no longer the purveyor of the QM rule, we believe there is still time for the Fed to weigh in with the Consumer Financial Protection Bureau (CFPB) and ensure that this rule does not serve to further tighten credit.” (“NAR Submits Letter to Bernanke on QE3″, Mortgage Professional)

How do you like that, eh? So according to Moe Veissi, making the system safer is too expensive. We just can’t afford it. We need to make credit available to people who wouldn’t normally qualify for a loan.

Sure, Moe, what could go wrong? It’s not like we’re going to blow up the financial system by lending too much money to people who can’t repay their debts, right?

Oh wait….

In any event, the banks and the special interest groups are trying to unwind the “Ability to Repay” and “Risk Retention” portions of the new regulations, even these are the essential firewalls that protect the general public from another disaster like the Crash of ’08?

If we heap these recent developments together (FHFA changes on “put-backs”, opposition to “risk retention” and “ability to repay”), then we see that we’re fairly close to where we were in 2007 before the two Bears Stearns hedge funds defaulted sparking the downward spiral that ended with the obliteration of Lehman Brothers on September 15, 2008 and the beginning of the Great Depression 2.

The banks are again in a position where they can skim profits off bad loans to every Tom, Dick and Harry that can sit upright and sign on the dotted line. They don’t have to worry about holding capital against their dodgy assets or whether Uncle Sam is going to get fleeced on the bogus $400,000 loan they issued to that unemployed landscaper living on food stamps. No worries. They’ve covered all the bases.

Now if Bernanke can just get that bubble-thing going, they’ll be back in the clover.

MIKE WHITNEY lives in Washington state. He is a contributor to Hopeless: Barack Obama and the Politics of Illusion (AK Press). Hopeless is also available in a Kindle edition. He can be reached at fergiewhitney@msn.com.