Why I can't support private retirement accounts
I'd like to be able to support President Bush in his quest to privatize social security. If the financial securities markets were actually regulated and controlled, I might. But these markets aren't controlled and I doubt they ever will be.
This position I take doesn't even consider the fact that any change in social security would be costly, and that conversion of social security, without a doubt, would have be to paid using money from the social security trust fund, depleting it even more.
President Bush said he would push for medical savings accounts, accounts into which people like me without health insurance could place money, accounts that would be tax-free and untouchable. He hasn't. If President Bush pushed for an ancillary private retirement savings account where I would be able to submit funds greater than $2,500 a year to be used strictly for retirement, tax-free and untouchable, I could support him in that. I could see how that would work. One job pays the bills and keeps me housed, clothed and fed, and the earnings from a second job could be deposited automatically and tax-free into these untouchable separate accounts for my medical needs and for my retirement. I'd rather President Bush stop spending his time on the lost cause of the private retirement accounts as he's defining them now and try to push for something like what I have outlined. Social Security is a safety net and I want that net.
But as it stands, I can't trust Wall Street. And I can't trust government -- Democrat or Republican or Independent -- to keep Wall Street regulated and controlled. The financial scandals of 2001 and 2002 hurt this country far worse than did terrorists flying jets into the World Trade Center. It is said the Osama bin Laden had his suicidal followers target the World Trade Center because it was a symbol of America's financial strength, and he wanted to hit the country in the wallet. All they had to do was get accounting degrees or broker's licenses and they could've accomplished what they set out to do. At worst, they'd get a fine for bringing down the U.S. financial system. The incestuousness that seems to be prevalent between politics and the mainstream media for the Democrats seems to be prevalent between politics and Wall Street for Republicans.
New York's Democratic Attorney General Elliot Spitzer made a big splash two years ago taking down the big guns on Wall Street -- and I'm sure he has plans to run for governor of New York -- but all he did was bitch-slap them a little bit and fine them. And the chairman of the Securities and Exchange Commission William Donaldson didn't even do that, although he took public credit as some kind of sheriff cleaning up the wild west.
I outlined this confidence job by Spitzer, Donaldson and the Wall Street securities firms on the American capital markets investor in a series of usenet posts in 2003. The hyperlinks to the original articles are inoperative, but the quotes are correct. The mainstream media reported what happened when it happened, but they covered it as a spot news singular event each time. They didn't tie the loose ends together and show that what happened was really no penalty at all.
You can rob a local liquor store for $500, get charged with a felony that prevents you from ever obtaining a decent job for the rest of your life and go to jail for 10 years. (All you to have to do is get arrested on a felony -- not convicted just arrested -- and the State of Louisiana can deny you a right to practice in the state as an Emergency Medical Technician.) But if you steal $20 million from the investment accounts of Joe and Mary America, you pay a small fine and endure a short stint of public humiliation.
The posts follow. They originally appeared on the usenet under the subject line "SEC's Donaldson caught in a lie" and later as "First, admit you have a problem (was: SEC's Donaldson caught in a lie)":
Google hyperlink to original message thread
The federal government and Wall Street still haven't explained the airline stock "put options" or short-selling in the weeks prior to 9/11, do you still believe that Wall Street brokerage firms are trustworthy?
[Update 4/24/2005: The biggest blowjob since Lewinski did Clinton -- "America's investors have been enormously well-served by Steve's keen intellect, superb judgment and abiding sense of justice," SEC Chairman William H. Donaldson said. "He is what every prosecutor should be: tough but fair." Comments by Donaldson on the resignation of the SEC's lead prosecutor, Stephen M. Cutler, 43. In the Washington Post report, Cutler neither admitted nor denied he'd had job offers from firms on Wall Street. The resignation announcement by Cutler came just days before the release of a scathing General Accounting Office report that said the SEC dropped the ball on mutual fund trading abuses.]
This position I take doesn't even consider the fact that any change in social security would be costly, and that conversion of social security, without a doubt, would have be to paid using money from the social security trust fund, depleting it even more.
President Bush said he would push for medical savings accounts, accounts into which people like me without health insurance could place money, accounts that would be tax-free and untouchable. He hasn't. If President Bush pushed for an ancillary private retirement savings account where I would be able to submit funds greater than $2,500 a year to be used strictly for retirement, tax-free and untouchable, I could support him in that. I could see how that would work. One job pays the bills and keeps me housed, clothed and fed, and the earnings from a second job could be deposited automatically and tax-free into these untouchable separate accounts for my medical needs and for my retirement. I'd rather President Bush stop spending his time on the lost cause of the private retirement accounts as he's defining them now and try to push for something like what I have outlined. Social Security is a safety net and I want that net.
But as it stands, I can't trust Wall Street. And I can't trust government -- Democrat or Republican or Independent -- to keep Wall Street regulated and controlled. The financial scandals of 2001 and 2002 hurt this country far worse than did terrorists flying jets into the World Trade Center. It is said the Osama bin Laden had his suicidal followers target the World Trade Center because it was a symbol of America's financial strength, and he wanted to hit the country in the wallet. All they had to do was get accounting degrees or broker's licenses and they could've accomplished what they set out to do. At worst, they'd get a fine for bringing down the U.S. financial system. The incestuousness that seems to be prevalent between politics and the mainstream media for the Democrats seems to be prevalent between politics and Wall Street for Republicans.
New York's Democratic Attorney General Elliot Spitzer made a big splash two years ago taking down the big guns on Wall Street -- and I'm sure he has plans to run for governor of New York -- but all he did was bitch-slap them a little bit and fine them. And the chairman of the Securities and Exchange Commission William Donaldson didn't even do that, although he took public credit as some kind of sheriff cleaning up the wild west.
I outlined this confidence job by Spitzer, Donaldson and the Wall Street securities firms on the American capital markets investor in a series of usenet posts in 2003. The hyperlinks to the original articles are inoperative, but the quotes are correct. The mainstream media reported what happened when it happened, but they covered it as a spot news singular event each time. They didn't tie the loose ends together and show that what happened was really no penalty at all.
You can rob a local liquor store for $500, get charged with a felony that prevents you from ever obtaining a decent job for the rest of your life and go to jail for 10 years. (All you to have to do is get arrested on a felony -- not convicted just arrested -- and the State of Louisiana can deny you a right to practice in the state as an Emergency Medical Technician.) But if you steal $20 million from the investment accounts of Joe and Mary America, you pay a small fine and endure a short stint of public humiliation.
The posts follow. They originally appeared on the usenet under the subject line "SEC's Donaldson caught in a lie" and later as "First, admit you have a problem (was: SEC's Donaldson caught in a lie)":
Google hyperlink to original message thread
Mark McBrideApr 28 2003, 3:46 pm
Subject: SEC's Donaldson caught in public lie
Regulators Reach $1.4 Billion Settlement
"When wrongdoing occurs, it must be confronted and punished," said SEC Chairman William Donaldson told a news conference, flanked by New York Attorney General Eliot Spitzer, New York Stock Exchange Chairman Richard Grasso and other regulators. "Today we are doing just that."
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None of the brokerages will admit wrongdoing under their deal with the stock exchanges, state regulators and the SEC.
http://story.news.yahoo.com/news?tmpl=story&cid=569&e=17&u=/nm/financ...
What's good for the corporation ought to be good for the individual. So this must mean the sentencing guidelines will be undergoing some changes. Right? So future court verdicts will be, for example, something like the following:
John Q. Brokerfirm, admitted no wrongdoing, but will pay $20,000 for raping little Suzie Homemaker and stealing her piggy bank. Mr. Brokerfirm will not have a felony record and thus will be entitled to all rights and priveleges granted citizens. He will be able to do business with the government. He will be able to obtain low interest federal loans. He will be able to market city, state, municipal and federal bonds if he so wishes. He can even legally buy guns. This agreement Mr. Brokerfirm makes with the federal agency that investigated him in fact does nothing but make his wallet a little lighter. It should be noted that while Mr. Brokerfirm is paying $20,000, he stole some $20 million from little Suzie Homemaker and, under the agreement with the courts, did not have to return it.
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Mark McBrideMay 2 2003, 4:57 pm
Subject: First, admit you have a problem (Was: SEC's Donaldson caught in public lie)
Investors, shareholders and potential retirees: Expect more of the same from the accounting firms, the brokerage firms, and corporate America.
Why? Because like any addicts, the corporations continue to deny they have a problem. You can't even begin to solve a problem unless you first admit you have one, the first step in any 12-step recovery program.
The politicians call any fines a success, but it'll be as successful as throwing an alcoholic in jail for the weekend. It doesn't solve the problem, and these greedy cash addicts will be back sucking retirement funds dry on Monday.
The headlines scream why any solutions imposed by an expedient financial settlement is only a stopgap measure before the pilfering begins anew.
"None of the brokerages will admit wrongdoing under their deal with the stock exchanges, state regulators and the SEC."
http://story.news.yahoo.com/news?tmpl=story&cid=569&e=17&u=/nm/financ...
"Candie's said that without admitting or denying any of the SEC's allegations, it has consented to the entry of an administrative order to cease and desist from violations of the books and records, internal controls, periodic reporting and certain anti-fraud provisions. Chief Executive Officer Neil Cole will pay a $75,000 fine, the company said. Cole did not admit or deny the SEC's allegations."
http://story.news.yahoo.com/news?tmpl=story&u=/nm/20030430/bs_nm/text...
Baron Capital issued the following statement: "After extensive discussions with the SEC staff, Baron Capital decided not to contest their view and to settle the matter without admitting or denying the SEC's findings."
http://story.news.yahoo.com/news?tmpl=story&u=/ft/20030501/bs_ft/1051...
Citigroup, Merrill and CSFB are also expected to be the only banks accused of outright securities fraud in the settlement. None of the banks will admit or deny wrongdoing.
http://story.news.yahoo.com/news?tmpl=story&u=/usatoday/20030428/bs_u...
United Airlines has agreed to pay the government and a whistle-blower $3.2 million to settle allegations of substandard maintenance work on military transport planes for the Air Force. Under the proposed settlement agreement, filed Monday in federal court in South Carolina, United denies all allegations brought by the whistle-blower, a former United mechanic who worked on the C-17 planes. The settlement must be approved by the South Carolina judge and the judge in United's bankruptcy reorganization case.
http://story.news.yahoo.com/news?tmpl=story&u=/usatoday/20030423/bs_u...
The litigation charge comes as Xerox appears to be emerging from years of troubling issues, including a federal probe into its accounting practices, which it settled by paying a fine without admitting or denying wrongdoing.
http://story.news.yahoo.com/news?tmpl=story&u=/nm/20030423/bs_nm/tech...
The Dial Corp. agreed Tuesday to pay $10 million to some 100 current and former female employees at its soap plant in Montgomery to settle sexual harassment accusations and avoid a pending trial. The Scottsdale, Ariz.-based company admitted no wrongdoing, but agreed to a federal consent decree that puts compliance monitors into its plant just southwest of Aurora for the next 2-1/2 years.
http://story.news.yahoo.com/news?tmpl=story&u=/cdh/20030430/lo_cdh/di...
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Mark McBrideMay 7 2003, 10:00 am
Subject: Re: First, admit you have a problem (Was: SEC's Donaldson caught in public lie)
"I believe that the Wall Street culture must change from the top down, and I am not convinced that the (settlement) has done enough to change attitudes at the top" of the big investment firms, Sen. Richard Shelby, R-Ala., chairman of the Senate Banking Committee, said at a hearing called to examine the accord. "Without holding executives and CEOs personally accountable for the wrongdoing that occurred under their watch, I do not believe that Wall Street will change its ways or that investor confidence will be restored."
http://story.news.yahoo.com/news?tmpl=story&u=/ap/20030507/ap_on_bi_g...
WASHINGTON (Reuters) - Drugmaker Andrx Corp. (Nasdaq:ADRX - news) on Tuesday agreed to pay $100,000 to settle allegations of improper accounting, the Securities and Exchange Commission (news - web sites) said. The SEC said Scott Lodin, the Andrx general counsel, and Timothy Nolan, the former president and chief operating officer of Cybear, its Internet unit, also agreed to settle the SEC case. The company, Lodin and Nolan settled without admitting or denying any wrongdoing.
http://story.news.yahoo.com/news?tmpl=story&u=/nm/20030506/bs_nm/heal...
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Mark McBrideMay 13 2003, 12:55 am
Subject: Re: First, admit you have a problem (Was: SEC's Donaldson caught in public lie)
"No top executive of the fined investment firms -- Merrill Lynch, J.P. Morgan Chase, Salomon Smith Barney and others -- has admitted wrongdoing, accepted responsibility and apologized to the public. Without self-recognition of ethical failures, future propriety on Wall Street cannot be assumed." Houston Chronicle editorial
http://www.chron.com/cs/CDA/story.hts/editorial/1904058
Reliant Resources Inc. and Reliant Energy settled an inquiry by the U.S. Securities and Exchange Commission on Monday, promising never to engage in improper 'round trip' trades nor accounting transactions designed to shift earnings. The Securities and Exchange Commission said it did not impose a fine on Reliant Resources, a Houston-based electricity provider, and Reliant Energy, which in August 2002 became CenterPoint Energy Inc., a Texas utility. The companies settled the matter, an administrative proceeding covering allegations spanning 1999-2001, without admitting or denying any wrongdoing, the SEC said.
http://story.news.yahoo.com/news?tmpl=story&u=/nm/20030512/bs_nm/ener...
US investment house Bear Stearns used an analyst to promote a new stock offering, days after Wall Street had agreed to sweeping ethical reforms.
http://story.news.yahoo.com/news?tmpl=story&u=/afp/20030512/ts_alt_af...
The stock market is the bread and butter of American capitalism. Its operation reflects directly on the ideals of free trade and full disclosure the United States promotes, internally as well as externally. Enron, Arthur Andersen and their ilk did more to damage the U.S. than the 19 terrorists who flew jets into the the World Trade Center. A warning of "caveat emptor" is not enough. The S.E.C. is tasked with enforcing the regulations against insider trading and fraud, regulations that were passed to prevent another stock market fiasco that sent America into the Great Depression and nearly destroyed the country in the process.
Should the citizens of this country apply "caveat emptor" to the water they buy from their municipal water company? Should they apply "caveat emptor" to the food they buy at the store, food that is stamped and approved by the USDA?
No, you cannot eliminate the dishonesty on Wall Street or in the boardrooms of corporate America, but you can sure as hell imprison those who steal money and break the law and make the penalty of dishonesty bitter, painful and memorable.
The "good ole boys" are letting their friends walk with a slap on the wrist. Old school ties and old fraternity pledges keep them on the street and their sticky little fingers on the wallets of Joe and Mary America. Trillions were lost by investors because of these deceitful brokerage firms who were allowed to scam a deluded public while Clintonista regulators turned a blind eye.
And trillions more will be lost until the problem is acknowledged and solved. A teenager takes $500 from a mini-mart and he's got an NCIC number that will follow him the rest of his life. A yuppy in a business suit cleans out the entire life savings of an elementary school teacher, and he has to skip lunch for one week at Tavern on the Green.
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Mark McBrideMay 16 2003, 2:54 pm
Subject: Re: First, admit you have a problem (Was: SEC's Donaldson caught in public lie)
If you're concerned ...
A good editorial ...
http://www.ctnow.com/news/opinion/editorials/hc-gotojail.artmay12,0,7...
Note to Mr. Donaldson:
No one has ever been toungue-lashed to within an inch of their life. A letter of rebuke and a tongue lashing mean nothing.
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Mark McBrideMay 19 2003, 4:40 pm
Subject: Re: First, admit you have a problem (Was: SEC's Donaldson caught in public lie)
"WorldCom Inc. agreed on Monday to pay a record $500 million fine to settle charges stemming from one of the biggest accounting fraud cases in U.S. history. ... The fine was originally set at $1.5 billion, but it was cut to $500 million because the company is in bankruptcy. ... The company neither admitted nor denied wrongdoing in the settlement filed on Monday."
[The fraud perpetrated upon investors is estimated at $11 billion. This fine imposed by the SEC, with no requirement for an admission of wrongdoing, sends the message that downside risk is less than 5% _if_ you get caught in a fraud upon investors.]
http://story.news.yahoo.com/news?tmpl=story&u=/nm/20030519/ts_nm/worl...
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Mark McBrideMay 20 2003, 11:59 pm
Subject: Re: First, admit you have a problem (Was: SEC's Donaldson caught in public lie)
WASHINGTON (Reuters) - A former senior vice president of HotJobs.com Inc., accused of buying stock in the company before the online job finder publicly announced a merger in 2001, has agreed to settled insider trading allegations, U.S. securities regulators said on Tuesday. David Carvajal, 32, agreed to pay $32,398 to settle allegations of insider trading while knowing nonpublic material information, without admitting or denying any wrongdoing, the Securities and Exchange Commission said.
http://story.news.yahoo.com/news?tmpl=story&u=/nm/20030520/wr_nm/tech...
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Mark McBrideMay 22 2003, 10:47 am
Subject: Re: First, admit you have a problem (Was: SEC's Donaldson caught in public lie)
A good editorial from the Atlanta Journal-Constitution:
http://www.ajc.com/opinion/content/opinion/0503/21mci.html
If Mr. Donaldson and the SEC continue with the wrist-slapping, and the backroom settlements the dishonesty on Wall Street will continue and this thread ought to grow to a few megabytes in a very short while.
Mr. Donaldson, despite the old school ties, the dishonest are not "little lambs who have lost their way, baaa, baaa, baaa" they are wolves who have torn the fabric of the American economic system for their own greed and benefit, doing more damage to the U.S. way of life than any members of al Qaeda ever did flying tin into stone.
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Mark McBrideMay 24 2003, 7:09 pm
Subject: Re: First, admit you have a problem (Was: SEC's Donaldson caught in public lie)
"PricewaterhouseCoopers, the nation's largest accounting firm, has agreed to pay $1 million to settle federal regulators' accusations that the firm acted improperly during a 1997 audit of a telecommunications company [SmarTalk], the Securities and Exchange Commission said yesterday.
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"In a statement released yesterday, PricewaterhouseCoopers, which did not acknowledge any wrongdoing, said: 'PricewaterhouseCoopers is pleased to have resolved this matter with the S.E.C. The S.E.C. agreement pertains to a matter that dates to 1998. We are fully complying with all provisions of the agreement.'"
http://www.nytimes.com/2003/05/23/business/23ACCO.html
I'll bet they were pleased: They screwed investors and the S.E.C. gave them the usual "slap on the hand" job and a tongue lashing. But at least the corporate private sectors jobs for former S.E.C. lawyers and accountants will be secure. Don't want to put potential employers out of business, do we?
The federal government and Wall Street still haven't explained the airline stock "put options" or short-selling in the weeks prior to 9/11, do you still believe that Wall Street brokerage firms are trustworthy?
[Update 4/24/2005: The biggest blowjob since Lewinski did Clinton -- "America's investors have been enormously well-served by Steve's keen intellect, superb judgment and abiding sense of justice," SEC Chairman William H. Donaldson said. "He is what every prosecutor should be: tough but fair." Comments by Donaldson on the resignation of the SEC's lead prosecutor, Stephen M. Cutler, 43. In the Washington Post report, Cutler neither admitted nor denied he'd had job offers from firms on Wall Street. The resignation announcement by Cutler came just days before the release of a scathing General Accounting Office report that said the SEC dropped the ball on mutual fund trading abuses.]
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posted by NEWS4A2, blood-sucking journalist @ 13:00
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