More Obama Double Talk – Obama Appoints Additional Advisors Tied To Financial Crash

Obama advisers’ Citigroup ties raise questions

Administration taps two former executives for high-level positions

WASHINGTON – Senior executives at Citigroup’s Alternative Investment division ran up hundreds of millions of dollars in losses last year on their esoteric collection of investments, including real estate funds and private highway construction projects, even as they collected seven-figure salaries and bonuses.

Now the Obama administration has turned to that Citigroup division — twice — for high-level advisers.

Jacob J. Lew, who served until late last year as the chief financial officer of Citigroup Alternative Investments, has been named deputy secretary of state, the department’s No. 2 position.

Michael Froman, another former chief financial officer at the Citigroup division, has joined the White House staff as deputy assistant to the president and deputy national security adviser for international economic affairs.

Both Mr. Lew and Mr. Froman are well respected in Washington for their extensive government experience, which includes work in the Clinton administration on budget matters, in Congress and on international financial affairs.

But their shift to the Obama administration from Citigroup has raised questions about the potential for conflicts of interest, and about whether Mr. Obama’s own staff members benefited from the kinds of Wall Street excesses he has criticized.

“You sort of have to wonder why it is so smart to put them in charge now, if they helped create the mess that we are in,” said Melanie Sloan, executive director of Citizens for Responsibility and Ethics in Washington. “They wouldn’t strike me as the natural choice.”

Senator Richard C. Shelby, Republican of Alabama, has questioned whether the Obama administration, like the Bush administration, is relying too much on former bank executives in shaping the bailout of the financial sector. Recent appointees include Mark A. Patterson, a former lobbyist at Goldman Sachs, who is now the chief of staff to the Treasury secretary.

“It seems to be an incestuous financial relationship situation here,” Mr. Shelby said at a Senate hearing last week, referring to senior Treasury executives, like Mr. Patterson, who once worked at investment banks. “And that’s very troubling not only to a lot of people on this committee but to the American people.”

Mr. Lew, through a State Department spokesman, declined to comment. Jennifer R. Psaki, a White House spokeswoman, said by e-mail that Mr. Froman’s past government experience in international financial affairs is just what is needed “given the global scope of the economic challenges we are facing.”

Citigroup paid Mr. Lew, 53, at least $1.1 million in salary and bonus last year, according to a financial disclosure form filed last month. The form noted that he might get an additional undisclosed bonus for his work in 2008 before he started his federal job.

As of last fall Citigroup Alternative Investments managed $49 billion worth of capital from individuals and institutions, investing in nontraditional ventures like a program that builds highways, runs airports and oversees other major public projects for governments.

In the first quarter of last year, the Alternative Investment division lost $509 million and for the whole year, it was part of a larger Citigroup division that lost $20 billion, according to Citigroup.

Mr. Lew’s job — overseeing financial matters at the State Department, with a focus on trying to increase the share of financing that goes to the diplomatic corps — will take him relatively far from this world.

Mr. Lew, who served as director of the Office of Management and Budget in the Clinton administration and was a longtime aide to Speaker Thomas P. O’Neill Jr., said at his confirmation hearing last month that he would recuse himself from State Department matters having a “particular impact” on Citigroup.

This article, “Advisers’ Citigroup Ties Raise Questions,” first appeared in The New York Times.

International Economists State Stimulus Packages Don’t Work

That’s right. Stimulus packages don’t work – they just redistribute income. They take your income and redistribute to someone else.

Stimulus packages do not create jobs. They never have and never will. This isn’t new News ….. This has been taught in Graduate Level Business courses for nearly 50 years. The study of “stimulus packages” in Graduate Schools across this Country is limited to a study of the “lies” perpetuated by Politicans and the liberal press about how they, “Stimulus Packages”, work. They Don’t. When you hear “Stimulus Package”, think “Pork Barrel Spending” dressed up for Halloween.

So you doubt this is accuarte? You are completely wrong. Government sponsored stimulus packages have been universally rejected as effective means to stimulate national economies.

THIS IS NOT AN ISSUE OF DEMOCRATIC AND REPUBLICAN IDEOLOGIES ….. It is a matter of Politicians lying to you while they feed their special interest groups off your tax dollars and the Economy and the Country go to hell in a hen basket……..

You doubt this ……. then read,

“Budget won’t spark growth, experts warn: Big scale belies lack of revenue, true stimulus”,

The fiscal 2009 draft budget unveiled Saturday isn’t likely to help Japan recover because the recession will probably accelerate the ongoing decline in tax revenues, economists warn. While some (politicians) say more spending is what is needed to stimulate the economy, others are suggesting the government should reconstruct its finances and embark on structural reforms to spur growth.

(Politicians everywhere are the same, they are simply looking to “buy votes” at public expense).

Finance Minister Shoichi Nakagawa stressed the budget would prevent the economy from worsening. Economists remain skeptical.”It is not clear whether it is really intended to improve the economy or perhaps with some consciousness of the impending election,” said Hideo Kumano, chief economist at Dai-Ichi Life Research Institute.

Experts, however, are stressing that fiscal reconstruction and structural reform within Government must be carried out. Regarding spending, Kumano suggested that the government should strictly select projects that will stimulate the economy.”Toward the future, (the government) should not lower the flag of fiscal reconstruction,” Naito said, urging the government to rebuild the framework for fiscal reconstruction at the earliest available date to slash the snowballing fiscal deficit.

Also see:  Flaherty says stimulus could come if necessary, but economists warn against it.

TORONTO – Finance Minister Jim Flaherty, a Politician, says his government is prepared to introduce a fiscal stimulus package if necessary in the 2009 budget, even if it means going into a deficit, but some economists say such a package could do more harm than good.

“I’m not a big fan of short-term stimulus packages,” said Don Drummond, chief economist at TD Bank. “They don’t really generate very much short-term stimulus and they very quickly become long-term structural problems.”

Drummond said the economic slowdown wasn’t created in Canada and therefore can’t be solved in Canada. “Canada is not the problem – we’re the only developed economy in which employment and consumption are still rising. Our economy’s been hit by international events, not by domestic events.” Drummond cautioned against doing “anything under the guise of short-term stimulus that doesn’t need to be done for longer-term interests.” For example, temporary tax cuts are often nearly impossible politically to reverse, and while spending on infrastructure can be beneficial, it takes a long time for major developments to be approved. “Most of the infrastructure you would mount right now isn’t going to hit the economy until 2011 or 2012 and hopefully we’ll be recovered by that point,” Drummond said. “In fact, we may even be facing an inflation problem again at that point.”

Jack Carr, an economist at the University of Toronto, said the Canadian government should be similarly wary. “I’m not in favour of a big stimulus package, particularly if it involves bailing out losers. Rewarding losers is not a way to compete in this global economy,” he said. 

Craig Wright, chief economist with Royal Bank, said whatever initiatives are introduced need to encourage productivity. “We have to do something to turn around productivity in Canada,” Wright said. He added that it was encouraging to see government trimming some of its own costs. By the time this world fiscal stimulus hits the road, the economies will probably already be in recovery,” he said. “That’s why these things never work. They’re supposed to be counter-cyclical and they end up being pro-cyclical.”

Also read:  Harper bets billions in stimulus will save economy”:

OTTAWA – The Harper government is breaking the bank in a desperate attempt to spend the economy out of recession. Tuesday’s federal budget makes no pretence at being anything but a return to Big Government that has Ottawa stretching its tentacles into every crevice of economic life – from how Canadians lease cars to imposing grace periods on credit-card companies before they can charge interest.
The underlying principle is that if the private sector won’t spend and invest, the government must do it.  

“I don’t want to call it a Christmas tree because sometimes that’s a derogative term when you’re looking at legislation,” said Bruce Yandle, an economics professor at Clemson University. “But it is a rather rich collection of things.”

Yandle said only about $170 billion, mostly the extension of unemployment benefits and the greater availability of Medicare for the unemployed, would provide much of a jolt to the economy in the coming year. And even then it’s questionable how much those breaks will lead to more spending that would help retailers and, in turn, manufacturers, he said. “When people are getting money in their pockets right now they’re not spending it. They’re saving more. They’re paying off debt,” Yandle said. “If people decided to save and pay off debt, that’s a good move, but it’s not the move that is contemplated by people who say we need to stimulate the economy.”

William Hauk, an assistant economics professor at the University of South Carolina’s Moore School of Business, said the infrastructure projects, such as roads, bridges, schools and upgrading the electrical grid, won’t stimulate the economy very soon because there’s often a long lag between when such projects are designed and when they’re built. “The phrase that gets thrown around a lot is ‘shovel ready.’ I’m not sure there are a whole lot of projects out there that are shovel ready,” Hauk said.

The infrastructure spending is creating capital assets, so that has some benefit in the long term, “but that’s not the biggest part of the spending bill,” said College of Charleston economics professor Frank Hefner. Hefner said the ideology behind such stimulus bills, that additional government spending will trickle through and revive the economy, isn’t proven to work. While some of the bill’s spending may have merit, Hefner said its effects may not appear before the economy is expected to recover on its own in a year or two.

David Brooks made the following observations in the New York Times:

There is a strong case to be made for a short, sharp stimulus package to restrain the collapse of the American economy. This would involve big, simple programs with immediate impact — a temporary cut in the payroll tax, expanded unemployment insurance and food stamps. 

There’s also a very strong case to be made for long-term government reform. America could fundamentally rethink its infrastructure policies — create a new model adapted to new modes of community-building. It could fundamentally rethink human capital policies — create a lifelong menu of learning options, from pre-K programs to service opportunities for the elderly.

But the stimulus bill emerging in the House of Representatives does neither of these things. It is an unholy marriage that manages to combine the worst of each approach — rushed short-term planning with expensive long-term fiscal impact.

The bill has three essential failings. First, it lacks any strategic vision. This $825 billion bill has to be passed within weeks. There’s no time for fundamental rethinking or new approaches. Instead, there’s a sloppy profusion of 152 different appropriations — off-the-shelf ideas that mostly create costlier versions of the status quo.

Second, the bill has relatively modest short-term impact. Many parts don’t even pretend to be stimulus measures, like funding for basic research, or special ed programs. But even the parts of the bill that aim to stimulate will have modest near-term impact.

A study by the Congressional Budget Office found that less than half of the money for infrastructure and discretionary programs would be spent by Oct. 1, 2010. (YES, THAT IS CORRECT, THE DEMOCRATIC CBO STATES LESS THAN HALF OF THE ALLEGED STIMULUS CASH GETS SPENT IN THE NEXT TWO YEARS). The total package is so diffuse, it costs $223,000 to create a single job.

According to The Washington Post, of the $30 billion devoted to highway spending, only $4 billion will be spent in the next two years. Less than $3 billion of the $18.5 billion for renewable energy and less than half the financing for school construction will be spent by 2011.


The Appropriations Committee chairman, David Obey, fulminated against the C.B.O. Wednesday, and the uselessness of economists in general, but he had no answer to these findings. ( I GUESS IT IS A REAL PAIN IN THE ASS WHEN THE EXPERTS YOU HIRED TELL YOU YOUR PLAN WON’T WORK – THE DEMOCRATIC SOLUTION – ATTACK THEIR OWN ECONOMISTS AND QUESTION WHAT THEY KNOW ABOUT THE ECONOMY ANYWAY – WHICH BEGS THE QUESTION, “WHY DID THE DEMOCRATS HIRED THEM IN THE FIRST PLACE”). 


Third, the spending measures in this bill have no sunset. In the middle of the Appropriations markup, the ranking member, Jerry Lewis from California, asked his chairman the crucial question: What happens when the economy recovers? Does this new spending disappear?Chairman Obey refused to answer, but he didn’t have to. 


On Tuesday, President Obama was inaugurated and vowed a new era. On Wednesday, the House Appropriations Committee met and showed the old era was very much alive. Democratic subcommittee chairmen sat like potted plants because all power was wielded by Chairman Obey. Republicans were in the dark because of an information embargo placed on the majority staff.
President Obama is clearly going to have to show the hard way that he meant what he said about bringing change. He didn’t run for president just to sign whatever bills the Old Bulls put on his desk. (Oh, you believe so.  I have an alternate option, Obama is just another old time Democratic Hack and the Country has returned to the old tax and spend ways of every other Democratic Administration. Obama/Biden – They could be twins. IF YOU WANT TO UNDERSTAND OBAMA’S FISCAL POLICY LOOK TO BIDEN’S RECORD).



He’s going to have to prove the hard way that he meant what he said about being pragmatic and evidence-based. That means he won’t sweep a C.B.O. study under the rug simply because the findings are inconvenient. He’s going to have to show that his plans have credibility, that a stimulus bill is really a stimulus bill, and not a Christmas tree for every special interest desire. (Let me ask you this, have your read or heard this anywhere else, that the Democratically controlled Congressional Budget Offfice questions wether the stimulus will stimulate growth or create even 1 new job? Of course not – Obama, with the help of the liberal media, is hidng this from the American People. Political “Payback” through “pork barrel spending” is more important to them than righting the American Economy).

American’s should be mad as hell at being lied to again and again. This is not a stimulus package – It is the largest pork barrel spending package ever to leave the Congress – This Pork Barrel extravaganza will not stimulate the American econmomy or help American Workers with new jobs. This “Package” will saddle the average American with huge increases in the taxes they owe down the line when the bill comes due.

If it works, the government (Politicians) estimate the $40 billion in stimulus will boost the economy by 1.9 per cent over the next two years. That’s a big if, say economists, who caution the plan could still come undone by poor execution, wrong assumptions about people’s ability or willingness to spend, and slow-to-start infrastructure projects.

As to the Obama/Pelosi Stimulus Plan passed by the House of Representatives, American Economists have said this,  

New Stimulus Package – 97 Cents Of Every Dollar Goes To Pork – $1,000 Per Illegal Alien

Sen. Inhofe: Stimulus Bill a ‘Big Buyoff’

Sen. James Inhofe, R-Okla., says the nearly trillion-dollar stimulus package the House of Representatives is heaping on Americans is nothing more than a huge spending bill with projects in it for people the Democratic-led Congress wants to buy off.

Inhofe, who says the bill will do nothing to stimulate the economy, says the bill will provide tax refunds to people who don’t pay any taxes, and would even give government checks of up to $1,000 to illegal aliens

“You have a stimulus bill that’s supposed to stimulate the economy,” Inhofe explains. “We know how to do that. We did it under John Kennedy; we did it under Ronald Reagan. We know what it does and what you have to do for capital gains and for all these things to open up the economy. But this [stimulus package] doesn’t do any of that. There’s so many things in there that are just bad.”

Inhofe notes that a lot of the pork lies in projects that have nothing to do with stimulating the U.S. economy, including:

  • $1.5 billion for homelessness prevention   
  • $650 million for digital TV coupons 
  • $650 million for wildlife management 
  • $600 million for the federal government to buy new green cars 
  • $570 million for climate change   
  • $75 million for smoking cessation activities  “The only tax decreases they have here are refundable tax credits,” Inhofe explains. “And that’s really just giving refunds to people who don’t pay taxes. That has nothing to do with stimulating the economy.”  One of Inhofe’s biggest objections to the $880 billion bill is that there is only $30 billion that goes toward some of what he believes are the real problems that should be addressed, such as roads and highways.  

    Inhofe says he personally met with President Barack Obama Monday to point out that the $30 billion earmarked for infrastructure represents only 3 percent of the total amount of the spending bill.  

    “When I told him that, he didn’t believe it was that small a percentage,” Inhofe says. ”I said, ‘If we find that I’m right and you’re wrong, would you go up to 10 percent?’ And he said, ‘I’d certainly look at that.’ Since then, he realizes that I am right. As far as roads and highways, it’s $30 billion, and then a few [dollars] for water infrastructure.” (CAN YOU BELIEVE THIS – “THE ONE” PROPOSES A TRILLION DOLLAR PORK SPENDING BILL AND “THE ONE” DOESN’T  KNOW WHAT HE AND PELOSI PUT IN IT .    YOU DECIDE,  IS THIS THE “CHANGE” WE WERE PROMISED OR JUST MORE TAX AND SPEND DEMOCRATIC POLITICS)

  • Inhofe believes it is the infrastructure improvements that could provide real jobs, while spurring the economy.
  • “We have over $1 billion worth of projects in America right now that are going to have to be done,” Inhofe points out. “Roads, bridges and that kind of thing; the type of thing government is supposed to be doing. We are going to do it, but this would allow them to do it earlier and use up some of that money they’re throwing away.”

    Ben Stein On Stimulus, “Enough Pork To Pay $75,000 To Every Unemployed American”

    Ben Stein: Half of Stimulus Goes to Unions

    Columnist Ben Stein has taken a close look at President Barack Obama’s proposed $820 billion stimulus package, and made some eye-opening discoveries. 

    Writing for and, Stein calculates that: 

  • The House of Representatives debated the bill for eight hours, or roughly $102 billion per hour.  
  • Only 10 percent of the stimulus funds would be spent in 2009.  
  • Almost half of the $820 billion would end up in the pockets of Democratic-controlled unions, such as the Service Employees International Union, and federal, state, and municipal employee unions.   
  • At 680 pages long, neither Obama nor any member of the House had enough time to read the entire bill before the House voted.   
  • The $820 billion would be enough to give every unemployed American $75,000.   Says Stein: “There has been pork-barrel politics since there has been politics, but the scale of this pork is beyond what had ever been imagined before — and no one can be sure it will actually do much stimulation. … This has been a punch in the solar plexus to the kind of responsible, far-seeing, mature government processes that are needed to protect America.”

    As published in the New York Post. com on 01/31/09


    I LOVE this. The new kind of politics of hope. Eight hours of debate in the House of Representatives to pass a bill spending $820 billion – or roughly $102 billion per hour of debate.

    Only 10 percent of the “stimulus” to be spent on 2009.

    Close to half goes to entities that sponsor or employ (or both) members of the Service Employees International Union, federal, state, and municipal employee unions or other Democrat-controlled unions.

    This bill is sent to Congress after President Obama has been in office for seven days. It is 680 pages long. According to my calculations, not one member of Congress read the entire bill before this vote. Obviously, it would have been impossible, given his schedule, for the president to have read the whole thing.

    For the amount spent, we could have given every unemployed person in the United States roughly $75,000.

    We could give every person who had lost a job and is now passing through long-term unemployment of six months or longer roughly $300,000.

    There has been pork-barrel politics since there has been politics, but the scale of this pork is beyond what had ever been imagined before – and no one can be sure it will actually do much stimulation.

    Further, no one can be sure that we are not already at the trough of the recession – such that this money will be spent mostly after the recovery is well under way.

    How long until the debt incurred under this program is so immense that it causes a downgrade in the nation’s sovereign debt? What happens to us then?

    This has been a punch in the solar plexus to the kind of responsible, far-seeing, mature government processes that are needed to protect America. This is more than pork-barrel – this is a coup for the constituencies of the party in power and against the idea of a responsible government itself. A bleak day.

    Obama’s Mideast Message Considered “Pathetic” & “Illusionary”

    In his interview with a Saudi-owned TV channel on Tuesday, President Barack Obama referred to “an illusionary past” in the Muslim world that was in fact plagued by turmoil, a leading Middle Eastern expert declared.

    Amir Taheri, in a New York Post column headlined “Pathetic Message,” said Obama “looked to the past rather than the future” when he told an Al-Arabiya interviewer he wanted a return to “the same respect and partnership that America had with the Muslim world as recently as 20 or 30 years ago.”

    But 30 years ago, Taheri noted, American diplomats were being held hostage in Iran, Soviet troops were seeking to annex Afghanistan, Saddam Hussein was preparing to invade Iran, Saudi Arabia was under siege by Muslim militants, and Syrian troops were preparing to invade Lebanon.

    Iranian-born Taheri, whose books include “Holy Terror: Inside the World of Islamic Terrorism,” wrote in the Post that “other features of this ‘golden age’” were “the seizure of power by mullahs in Tehran, the assassination of Egyptian President Anwar Sadat, the coming to power of communists in the Horn of Africa, the military coup in Turkey, the first Islamist terror attacks in Algeria, unprecedented waves of repression in Egypt and Saudi Arabia, and the imposition of military rule in Pakistan.”

    Twenty years ago saw the U.S. arming the mujahedin in Afghanistan, Iraq gassing thousands of Kurds and preparing to invade Kuwait, Iranian mullahs arming Hezbollah units in Lebanon, Turkey launching all-out attacks on Kurdish secessionists, and the Libyan terror network killing American soldiers in Europe and blowing up U.S. jets.

    Meanwhile Obama offered only “trite” remarks regarding the Israeli-Palestinian issue, and did not offer any support “to democratic forces facing crucial elections in Afghanistan, Iran, Iraq, Lebanon, the Palestinian territories, Egypt and Algeria,” observed Taheri, who has written for more than two dozen publications around the world.

    “Nor was there any nod toward reformers in Saudi Arabia and Egypt.”

    Obama sought to portray himself as the “bridge” between the U.S. and the Muslim world, according to Taheri, who added:

    “Casting himself in the role of a ‘bridge’ and dreaming of a return to an illusionary past, Obama appeared unsure of his own identity and confused about the role that America should play in global politics.”


    “the new administration must realize and acknowledge that America is at war with a variety of forces dedicated to challenging its global leadership in the hope of ultimately achieving its destruction ….”

    The core of the war Islamic radicalism is waging against the United States in the Middle East is ideological. On the one side, there is the Western ideology of human rights, democracy and secularism. On the other, there is religious obscurantism symbolized by the late Ayatollah Khomeini ……

    A small but growing democratic constituency is emerging in virtually every country in the region. Allied with other moderate, conservative, traditionalist but nonviolent segments of society, this constituency could challenge and ultimately defeat Islamism in the political battlefield. The United States should throw its support behind such forces wherever they exist.

    The showdown between these forces and Islamism will come this year as Afghanistan, Iran, Iraq, Lebanon and the Palestinian territories hold presidential, parliamentary and municipal elections. The Islamists have mobilized their forces and brought in massive resources to win those elections. The perception that America has abandoned its democratic and moderate allies could persuade the fence-sitters to side with the Islamists.

    Obama has abandoned a multilateral approach (an approach where the US worked with the United Nations, the European Union, NATO and the Soviet Union) in favor of Obama’s singular brand of contact with both Hizbollah and the Iranian Government.

    Mockingly, the inexperienced Presdient’s described as, “clearly counting on the “audacity of hope,” and “his charisma”. Obama’s reckless actions have robbed former Bristish Prime Minister Tony Blair of his previously granted authority as Chief Peace Envoy for the West in the Middle East.

     By seeking unconditional talks with Tehran, he is also setting aside three unanimous, mandatory UN Security Council resolutions. 

    The move also means the effective dissolution of the “5+1 Group,” created three years ago to deal with Iran. Apart from America, the group includes Russia, China, Britain and France (the four other veto-holding Security Council members), plus Germany.

    By naming Richard Holbrooke as special envoy for Afghanistan and Pakistan, the new president has, in effect, killed the idea of appointing a Kabul coordinator backed by all of NATO.  Holbrooke’s appointment has received an even cooler response in Afghanistan and Pakistan, where he is seen as the man who rubber-stamped Serbian territorial gains, secured through ethnic cleansing and the massacre of Muslims, in Bosnia in exchange for a piece of paper signed at Dayton, Ohio.

    More than a dozen Arab states have adopted constitutions and introduced some form of electoral politics. Kuwaiti women have won the right to vote and get elected.

    Iran’s democratic forces are encouraged to launch their campaign against the mullahs. The Islamists have been roundly defeated in Algeria, Egypt, Yemen and Saudi Arabia.

    For the first time, the question of democracy is top of the political agenda in virtually every Muslim state.

    “Obama should remember that he is the president of the United States – not an impartial broker. It was unfortunate that he described himself as a bridge. For a bridge has no personality of its own and cares little about who might cross it and in which direction.”

    “Obama’s remarks about the Israel-Palestine issue were so trite as to merit no analysis.” He said he was sending former Sen. George Mitchell to listen to all sides – as if the world has not been hearing their stories for more than six decades.

    He had nothing to say about the thousands of Iranian workers who have been thrown into prison solely because they created independent trade unions. Nor did he mention Iranian women’s courageous “a million signatures campaign” or the series of student revolts that have been crushed by the mullahs with exceptional violence.

    The president appeared apologetic, offering no hope for democratization and economic development

    Obama didn’t call for the release of the tens of thousands of political prisoners held in more than two dozen Muslim countries or a moratorium on executions that each year cost the lives of hundreds of dissidents.

    At this critical time, with the World looking to America for Leadership, Obama can only display his inexperience, while his ego prevents him from consulting with our Allies. Obama has pathetically failed to make America’s case to either friend or foe. At this critical time in history rhetoric and ego cannot replace meaningful action. 

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