Former Treasury Secretary Paul O'Neill: Bush Doesn't Understand Crisis, 'It Shows'
By John Amato Thursday Sep 25, 2008 8:45am
I read Ron Suskind's book called "The Price of Loyalty George W. Bush, the White House, and the Education of Paul O'Neill," and there's a chapter that is a prequel to the economic nightmare we are facing today. O'Neill wanted CEOs to be held accountable for their financial records that their companies made public. Enron was the red blinking light, so to speak---the PDB that told the administration disaster was a-coming. Remind you of anyone? The CEOs are Bush's base and they balked big time. I was trying to scan a couple of pages for you, but thankfully Suskind printed this in the NY Times times called 'The Crisis Last Time."
The crisis of that moment was the implosion of Enron, Global Crossing and other companies. Along with conflicts of interest and criminally creative bookkeeping, the culprit was often a combination of financial complexity and insanely expensive compensation packages.
Enron is long gone, but this episode - as much a warning for our financial security as the 1993 World Trade Center bombing was to the threat of wider terrorism - carries some telling lessons as our best minds struggle now to save the economy.An article about the meeting appeared a few days later in The Wall Street Journal. The next day, Mr. O'Neill was in Florida addressing chief executives of America's top 20 financial services companies. They piled on. One told the Treasury secretary that he'd "rather resign" than be held accountable for "what's going on in my company." A phalanx of outraged financial industry chiefs, many of them large Republican contributors, called the White House. Real reform was a political dead letter.
A presidential speech that followed was toothless, mostly recommending that chief executives personally certify their companies' financial statements. Earnings per share remained the gold standard. The Sarbanes-Oxley bill, signed into law a few months later, largely focused on the auditors, and actually increased the complexity of reporting practices. As for lawsuits? Not to worry. No significant rise.
At issue, of course, were those twins, transparency and accountability. The years since have shown that the first one is meaningless without the second. With a world financial crisis upon us, the president and his economic team are forced again to talk about accountability. Let's hope this time they mean it.
Paul O'Neill then came out with this today: Bush Doesn't Get Financial Crisis, 'It Shows'
So why is the president and his administration pushing so hard for this plan?"I think it's because they're in a panic and they haven't thought about it very well," O'Neill said.
The bailout process risks being bogged down by a number of "sideshow issues," O'Neill added, including executive pay and aid for homeowners.
"Not a lot of people are saying, 'Slow down.' They've actually done something a lot worse than say, 'Slow down.' They've introduced a whole bunch of sideshow issues like executive compensation and oversight committees," O'Neill said. "All of that stuff is not relevant to the central problem of re-liquefying these financial instruments."
O'Neill said we got into this mess because bankers were not making prudent decisions, because they believed that by reselling mortgages to Wall Street they weren't going to be stuck with the problems.
"We suspended disbelief and said we can take people with no known source income or wealth generation and we can give them a $500,000 mortgage," he said. "I think there's a very important thing: When you violate fundamental principles of economics you can get away with it for a while, but eventually it's going to get you."
There are a lot of side shows going on for sure and the American tax payer is getting royally screwed as usual by Conservatives. All these nice little safeguards they are putting in place to somehow protect us will be useless. At least he didn't blame the poor people for the crisis and apply the Kudlow thesis to it...
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That's because Bush is a Bank Robber and a War Criminal first -- anything else, second.
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I think Bush is trying to find the BCCC to borrow money again for his failed business errr...acumen.
Here we learn how the Bush Junta came up with the number $700 billion.
THEY PULLED IT OUT OF THIN AIR!
How can anyone take these people seriously?
A friend sent me her thoughts on the matter yesterday ~~
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Georgia has their own version of loyal crook. James Mills is a tax and spend rebublican who is so loyal to the current leadership, he will do and say anything. We need to kick all of these bums out in every state. James Mills for State Representative NOT!
Trittydi@4 But...but...but if we give the money to the average taxpayer it's socialism!
Looks like bush actually HELPED Bin Ladin since BinLadin wanted to bring down the US Financial kingdom and hit the WTC. So bush marches us off to a war built on lies that cost us almost a trillion $ and neglects Bin Ladin. Meanwhile the markets get free reign to do things anyway they want with no oversight or restrictions
That to me says bush did exactly what Bin Ladin wanted.
Mick Piobr @ 6:
You'd be able to hear the Re-Thugs howling from the moon. They consider that money theirs.
What the hell is wrong with the dems anyway?
NOT ONE creative thinker in the lot. Business as usual - " ...but, but, but -- that's NOT how we do things!!"
Heaven forbid EVEN ONE STINKING LOUSY DEM should think outside the box.
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Trittydi @ 4:
Except the math is all wrong on that, plus it was satire, if I remember correctly.
What's scarier is McSame and Sarah Simpleton McCheney know less about the economy than Bush.
"Trittydi@4 But…but…but if we give the money to the average taxpayer it’s socialism!"
Not to mention the math is utterly screwed up.
85 000 000 000,- USD divided by 200 000 000 people is 425,- USD pr head, not 425 000,-. You need 85 trillion for that to work.
All Chimpman knows is spend, spend, spend, debt, borrow, debt and corporate socialism. He's no freaking conservative and a terrible liberal.
This whole mess is the direct result of 8 years of governance by incompetent leaders who simply are unprepared to deal with the complexities of the 21st Century. A bone-headed President places people at the helms of institutions with responsibility for oversight and direction of our security, our financial system, our economy, our social programs based solely on loyalty. Guided by a powerful group whose only interest is personal and Party power, he forfeited any semblance of leadership.
We have sat and watched as obvious challenges and problems have been ignored or simply dismissed as trivial until they reach the point of crisis. Not only can these fools not handle crises, they can't handle the day-day operations they are responsible for.
Now, we are left with an enormous and historically important crisis, again, and we have politicians playing games for some perceived short-term gain or pay-back. And the folks playing the game are simply incapable of actually understanding the depth and breadth of the problems at hand.
The topper is the "Superhero Fly-in" by a Presidential Candidate who knows as much about complex economic and financial issues as I do about Quantum Physics. The whole thing is a disgrace and something, I am afraid, we have earned by our collective passivity as citizens.
If we don't vote for the smart ones this time, we can kiss America's legacy good-bye.
3 Alice X - (Click Here for Nader Debate What If) - status quObama - change you can pretend in - Says...
Alice, it's called a rectal estimate. They pulled a number out of their ass.
china no longer allowed to lend to USA?
http://www.reuters.com/article/companyNewsAndPR/idUSPEK16693720080925
♠♠...Bangkok Bob...♠♠ @ 7:
100% Correct! I am amazed that this very simple fact is not more often discussed. I wouldn't give Chimpy all the credit, however. He has had a lot of help and, more importantly, firm guidance by his handlers. I stepped outside last night, and I swear I could the howls laughter coming from the caves along the Afghanistan/Pakistan border. Pathetic, isn't it?
So why is the president and his administration pushing so hard for this plan?”I think it’s because they’re in a panic and they haven’t thought about it very well,” O’Neill said.
BULLSHIT!!
This is right according to plan. And you people keep calling Bushco idiots!!! Swindle 1 was the war...a massive transfer payment
to the rich!! Phase 2, Katrina and the stealing there. Phase 3 the bail out!! It's an obscene rip off, and it is so bad even John
Boehner is wary of it! I guess some Repubs are still humans to a certain point!! I find this weirdly reassuring, that congressional
Repubs are finding their limits to their corporate enabling.
Barrett D @ 15:
We all knew that was coming. The real bitch is going to be when they come to collect.
Neocons involved in a Dr. Evil style plot to steal money from American taxpayers.
With my "LASER" I will melt down the global economy.
Unless of course Congress gives me One Million Dollars!
It's 2008 numb-nuts a million dollars wouldn't buy you a burger king.
Oh sorry!
Unless of course Congress gives me One Trillion Dollars!
Boo-hoo-ha-ha....
Did Chimpboy (attempt to) speak yet on the TV this AM?
HAHAHAHAHA! The Communists won't lend us any money.
Call Lilmbaugh...let him know...call your Congressman...tell him we need to vote for war with China.
sgtmajor @ 13:
Once again the Washington Bandits are called incompetent!!! That judgement is relative. If you are among the uber rich
they have been doing just fine. For the 6,792, 618th time...the military industrial medaitainment big pharma complex is not
made of idiots. The idiots are the working men and women that keep voting for these thieves.
This is all so fucking rich. I'm sorry...but I'm laughing my ass off.
You HAVE to laugh. George W. Bush...President of the United States. LOLOL!
I said it years ago, and I meant it. The American People have NOTHING to whine about now.
They created this mess themselves.
I can just hear George Bush in that meeting yesterday.
"But...but...can't we just print more money?"
No matter which way this bill goes, we're all screwed. Thanks to Booosh. If anything good comes out of it, it will be that the GOP and their "conservative" mantra are DEAD, hopefully never to again rear their ugly heads on the American landscape and permanently obliterated from the political lexicon. Good riddance. R.I.P.
It's nothing more then a FORCED taxpayer bailout of slime balls, crooks, and liars who created the mess to begin with.
Every American should OBJECT
Most of these guys" are going to take their 100 millions and 100s of billions and vamoose to Dubai. Hey that sounds like a great title for a spy novel: "Vamoose to Dubai!" And then the movie series: "Vamoose to Dubai II!" has sort of a ring to it ... and "Vamoose to Dubai fo(u)r" sounds interesting too.
Liberal AND Proud @ 21:
The Communists will be able to take over without firing a shot. They'll just buy up our banks and businesses at fire sale prices. Next thing you know we'll be buying our cars from Chairman Moaters.
I think O'Neill is correct. The Bush Administration and all of Congress for that matter appear to be in a full blown panic. In fact, I recall Sen. Harry Reid several days ago saying that "No one knows what to do." Investors seem to picking up on that feeling and are moving into more safe haven assets because of it. This whole bailout is a rush job and so massive in scope that its consequences can not easily be forseen. They really need to slow down and think before they act in my opinion. This is a financial form of the 9/11 attacks and just like it was back then, the Bush Administration didn't see it coming.
When you put someone in charge of things who has never had to live on a budget, you have the high possibility of having someone who doesn't understand the value or being responsible with money. Bush comes from wealth and has no conception of reasonable spending. McCain has the same background. Neither of them knows even the basics of economics.
Now let's focus on Obama. He comes from a poor background, he and his wife raised a family while paying back student loans. Yes, he made several million from the sale of his books but I would bet big time that a lot of that money is tucked safely away for the education of his daughters.
Of the men I mentioned here, which would you allow to run your personal finances for for six months?
WASHINGTON — The day began with an agreement that Washington hoped would end the financial crisis that has gripped the nation. It dissolved into a verbal brawl in the Cabinet Room of the White House, urgent warnings from the president and pleas from a Treasury secretary who knelt before the House speaker and appealed for her support.
“If money isn’t loosened up, this sucker could go down,” President Bush declared Thursday as he watched the $700 billion bailout package fall apart before his eyes, according to one person in the room.
HAHAHAHAHA Oh cry me a river there!
Do nothing! The free market will correct itself! Milton Friedman told me so!
fastfeat @ 20:
Yes! He said it was "hard work", something needs to be done and something will be done. Then he turned around and left.
Liberal AND Proud @ 23:
Sadly this is true.
It's Bill Clinton's fault!!!
There are a lot of side shows going on for sure and the American tax payer is getting royally screwed as usual by Conservatives.
this 'crisis' likely was engineered to gut Govt. social spending.
Grover Norquist's wet dream: shrink 'entitlements' enough to drown (that side of) Govt in his bathtub.
It'll work, sher as yer born...
bush for 3rd time! :)
It's Thomas Jefferson's fault!!
It's FDR's fault!
It's JFK's fault!
It's Jimmy Carter's fault!
It's Al Gore's fault!
I think that I am beginning to understand why the Congress has not impeached Bush. I always wondered what he had hanging over peoples heads. The 2000 and 2004 elections were fraudulent; we all know this. Why did neither Gore or Kerry challenge the results? During the election of 2004, why did Kerry treat Bush like a golden child and not go after him over his war crimes and financial crimes? Why are they all afraid of him?
Well apparently the global bankers have got Bush's back. I bet they have been threatening to tank the global economies the entire time. I'm wondering if this whole thing is just political posturing. We all know that the neocons have a hard-on for bombing Iran. We all know that the global community has told Bushy "NO". I'm thinking the bankers are flexing their muscles. I'm thinking that they are trying to show everyone in the World who is really in charge. Tell us "NO" and we will tighten up the credit and screw your economies up. Not only are we going to tighten up the credit; but, we want you to pay us one trillion dollars.
These are the same exact people that put Hitler in power to deal with the Communists in Russia that had rejected the global banking system.
The American Dream was literally just that.
A dream
It's Reagan's fault.
Ohhh...I'm sorry....the GOP said not play the blame game.
pissed off patricia @ 33:
glad I wasn't subjected to that 3 second apparition of the idiot in chief, the decider.
For decades the rethugs have tried, and to some extent, succeeded in making the word LIBERAL something synonymous to an obnoxious curse word. How slowly the table of time has turned to now expose the word and the CONSERVATIVE philosophy one of abject, collossal and absolute FAILURE! From this point forward, let us not miss a moment to let them and their acolyte supporters wear the "conservative" label as a yoke around their necks, their scarlet letter of failure and shame. Let's bury this evil shroud once and for all.
Liberal AND Proud @ 41:
You got it all wrong. It's all Ralph Nader's fault for warning us about this all along.
People need to say . . wait a minute here why the hell am I going to have to bail out financial criminals who should be going to prison? What the hell kind of FREAKING IDIOTS-SUCKERS DO YOU THINK WE ARE!
Bring it on! Shoot me FOR DARING to stand up for my rights and challenge your AUTHORITY!
No ones spending money, and no ones lending money.
Figure it out
L.A. Confidential @ 40:
hiya Happy, haven't seen you for a couple of days ... missed your sunny disposition.
The American Dream had too much pizza the night before and it is now a nightmare.
IdiotShrub @ 43:
Yes, conservative is now the accursed "C-WORD".
I would love to see Obama call McCain the "C-WORD", during the debate. If Sponge John Mc-Scaredey-Pants even bothers to show up.
They really need to slow down and think before they act in my opinion. This is a financial form of the 9/11 attacks and just like it was back then, the Bush Administration didn’t see it coming.
But it's campaign time . . . we're threatening their extended "vacation" and expect them to stay and work! George couldn't interrupt his vacation to attend to Katrina; can we really expect Congress to stay in session and NOT rush to the most expedient 'solution'?
Of course it's relevant, as it goes to accountability and prudence. Presumably if executives were actually responsible for their decisions they would never have invented these complex and obstruse financial instruments to begin with. They either knew that they were effectively creating money out of thin air (fraud) or they were incompetent managers. Maybe it's time to stop structuring CEO salaries with huge bonuses that are independent of performance, and maybe put large penalty clauses for poor results in their place.
It's going to be real interesting watching these guys try to slide out of this one over the next month.
A real dog and pony show if there ever was one thats obvious.
Melody @ 49:
It seems to me that the problem is how do we clip the wings of the global bankers. Giving them a Christmas bonus isn't much of a plan in my books.
upchuck @ 48:
As is "Republican". Those running for re-election are using GOP Party instead. since most of their base are uninformed idiots they wont know they are the same thing.
I think they do get it and play dumb. Case in point is the figurehead in the oval office right now. In my short lifespan, whenever the thugs hold the executive branch they, without fail, grift and use the position of office with immunity.
Hold the bastards accountable.
The next thing to watch is how foreign debt holders react to this bailout plan:
Asia Needs Deal to Prevent Panic Selling of U.S. Debt, Yu Says
Sept. 25 (Bloomberg) -- Japan, China and other holders of U.S. government debt must quickly reach an agreement to prevent panic sales leading to a global financial collapse, said Yu Yongding, a former adviser to the Chinese central bank.
``We are in the same boat, we must cooperate,'' Yu said in an interview in Beijing on Sept. 23. ``If there's no selling in a panicked way, then China willingly can continue to provide our financial support by continuing to hold U.S. assets.''
http://bloomberg.com/apps/news?pid=20601087&sid=anZHfo6tQi60&refer=home
The video you provide does not show Paul O'Neill making any statement about Bush. It is an old video of Richard Ben-Veniste grilling Rice about the famous presidential briefing document.
99% of Americans probably think they actually still at this actual moment they have a solid pension, bank balance, 401K, savings account, etc, etc?
I don't think so!
Hey! I know...let's demogogue our Chinese masters.
We are the Masters of the WORLD!
The Chinese have nukes. We need to follow George Bush's policy...and spread our democracy to them. How DARE they have a growing economy. It's all smoke and mirrors.
♠♠...Bangkok Bob...♠♠ @ 7:
Yup. Yup. Imagine, couple of guys living in caves like animals, are able to bring down the most powerful country in the free world, without firing a single shot. Just scare Americans (rethuglicans) shitless and watch them totally freak out. "Boooo!"
L.A. Confidential @ 57:
Sorry about that grammar my stream of consciousness blurting is on overdrive
Note to wordsmiths - I used the word 'obstruse' above @50, which isn't really a word YET. You can give it a combined meaning of obtuse and abstruse.
As of now, the market seems to be pretty much holding its own. Perhaps the sky is falling prediction was a wee bit premature. It's been a week since Paulson said something that sucked the air out of the room and for all means and purposes, there are still people able to breath.
Afghanistan is failing.
We need to support the troops. We need a new infusion of cash into the military budget!
We must act NOW...we must fight the terrorists THERE, so we don't have to fight them HERE.
And we must put more money into Iraq...only when they stand up can we fall...errr..stand down.
I am so worse off now then I was just five years ago. I had money in the bank, I paid my bills on time- now I am in debt bec. of medical issues and my expenses have more then double but my salary is below what it was five years ago.
If McCain pulls off the hero moment and gets in the WH. I will move to Russia and throw spitballs at Sarah Palins house.
Can anyone here help me. I can't seem to find my troll.
Heeere trollie trollie.
L.A. Confidential @ 40:
That's probably how it got the name.
Susie, your anger is misplaced. This is all Bill Clinton's fault.
Thank GOD, George W. Bush is our President.
♠♠...Bangkok Bob...♠♠ @ 42:
I watched and listened to him here so that you wouldn't have to watch and listen to him there.
Alternative Plan offered in congress: Congresswoman Marcy Kaptur (D) OH
http://www.youtube.com/watch?v=LzFDQjAzw1g&feature=related
pissed off patricia @ 33:
Wow! I can understand why ABCCBSNBCorp didn't bother to interrupt its daytime TV programming.
SadButTrue @ 61:
Meaning implicitly understood here!
Thank GOD, John McCain is a war hero and former POW.
He will SAVE US!!
Bush schedule to make announcement that he is financially sound.
pissed off patricia @ 68:
I can't listen to him anymore. The novelty of a talking chimp wore off about seven and a half years ago.
Recall? 2000? The "MBA President", the "CEO-in-Chief"? Gonna come in and run a tight ship?
Unbelievable so many people bought that canard.
62 pissed off patricia Says:
"As of now, the market seems to be pretty much holding its own. Perhaps the sky is falling prediction was a wee bit premature. It’s been a week since Paulson said something that sucked the air out of the room and for all means and purposes, there are still people able to breath."
It looks like your correct. I would also add that the temporary ban on short selling of especially financial institutions probably also plays a role. What is interesting at the moment is that the old safe haven, gold is rocketing once again in price. Its up about $20 right now.
L.A. Confidential @ 57:
As far as I know, 401k's are not guaranteed by the FDIC, but bank deposits are, up to $100k. The erroneous assumption by the populace that says in essence that government is there for them, just points to the bigger and more deeply troubling (and embarrassing) reality of just how DUMB and ill-informed the average American really is. No Country Left Behind has succeeded beautifully, it seems.
can we please impeach the traitorous war criminal NOW, for sheer incompetence?
This Impeachment TV Ad Now Running in Conyers' District
by Ralph Lopez
Wed Sep 24, 2008 at 12:05:20 PM PDT
...with a slightly different end-tag, on FoxNews, MSNBC, CNN Headlines, Comedy Central, and a few other cable stations. It is also running in Jacksonville, North Carolina, proud home of Camp Lejeune. THE 60 SECOND SPOT.
The Clinton impeachment timeline was as follows:
Oct. 8th - Henry Hyde introduced H. Res. 581 to authorize and direct the Judiciary Committee to investigate whether there are sufficient grounds for impeachment.
Dec. 8th – a motion for censure instead is defeated.
Dec. 11th & 12th Judiciary Committee approves four articles of impeachment.
Dec. 16th The full report is released.
Jan. 7th Impeachment Trial begins.
The 110th Congress is far from over, and it comes back to a full workload and schedule of hearings after the Nov. 4th election. Bush's case is far more open and shut than Clinton's ever was, since their offenses are admitted and in the public record, including the most recent impeachable offense: the defiance of congressional subpoenas.
Everyone can see what's coming for Obama, and it's ugly. The major media has decided he will not win, just as it decided that the impeachment hearings on July 25th in the House Judiciary Committee would not be heard by the general public. First they silence relatively small slices of opinion, then gradually bigger slices. Some could see what was happening all along, and some will never see it. In between is everyone else, who will decide the outcome. If you are interested in running the ad in your district, not as a Democrat, though you be a good one, but as an American, please let ImpeachTime.org know.
The first step toward a return of checks-and-balances, and possibly impeachment hearings: Help Gov. Seigelman Tell Conyers to Hold Rove in Inherent Contempt. Don't just send the email; call your own representative.
Then call Judiciary members, numbers here.
Tags: impeach, impeachment (all tags) :: Previous Tag Versions
Watch the video and read viewers comments
http://www.dailykos.com/story/2008/9/24/142940/321/321/608856
This is the disturbing thing about BushCo, We have the knowledge and talent in America to do things properly with rewards for everyone but instead the Greedy Old Party has to rob the poor and give to the rich like a bunch of frat brothers at the Halloween Ball.
One has to wonder where these people obtained their values and why they hate the common folks that work everyday and do their best to live properly in a free society.
If we know what the right path is why can't we move down that path?
Just thinking. . . ;-)
"...as our best minds struggle to save the economy..."
As if ! If "our best minds" were EVER listened to we wouldn't be in this mess in the first place !
POP, the fundamentals of the fundamentals are fundamentally sound.
If you were holding 100 shares of WaMu (WM) a year ago today, you had $3,566 worth. Today, it's still trading after they crashed and got sold, but your hundred shares this morning are worth $16.40. A 99.5% loss.
We don't need our best minds, Myra.
Gosh...such elitists thinking.
We need the leadership of