Governor Cuomo Pals Up With Banker/Criminal John Mack For Wall Street Outreach

Jimmy Vielkind at Capital NY:

ALBANY—Governor Andrew Cuomo is utilizing John Mack, a senior adviser to Morgan Stanley who the governor recently brought on to be an adviser on global trade, to help him navigate the titans of Wall Street, according to schedule documents released by Cuomo's office.

Cuomo began regular meetings with Mack, a former C.E.O. of the investment bank, in the fall of last year.

The schedules show Mack accompanied Cuomo to a meeting with current Morgan Stanley C.E.O. James Gorman on December 12, and to a meeting with Goldman Sachs C.E.O. Lloyd Blankfein on the following day.

Mack also attended an afternoon meeting on Veteran's Day that included senior officials from Empire State Development as well as Leslie Whatley, the director of the governor's new program to create tax-free zones rooted at public university systems. She was formerly the global head of corporate real estate at both Morgan Stanley and JPMorgan

Cuomo administration spokespeople did not immediately say what the governor discussed with Gorman and Blankfein.

Matt Taibbi on John Mack:

John Mack, the former CEO of Morgan Stanley and one of the more irritatingly unrepentant dickheads of the crisis era, gave an incredible interview to Bloomberg TV. In a discussion about executive pay, Mack said we're all being too rough on his fellow too-big-to-fail bank CEOs.

He would love, he said, "to see people stop beating up on Lloyd and Jamie," endearingly referring to Goldman chief Lloyd Blankfein and Chase chief Jamie Dimon by their first names (Mack must be in a bowling league with both men). He added: "I think that would make a lot of sense, and I'm in favor of that."

Mack went on to say that the debate over compensation was healthy, just not always warranted. "As long as shareholders reward performance," he said, "we can argue." But, he added, "The last time I checked, this business is still a business that pays people extremely well."

It's already funny that of all the injustices in the world, this was the one Mack decided to worry about on TV: the criticism of poor Jamie Dimon's 74 percent raise. But more to the point: If we really did live in a world where shareholders rewarded performance, would a CEO who just oversaw a record $20 billion in regulatory penalties even have a job, much less be getting a raise?

Mack had stones enough to be whining about people "beating up" on Jamie Dimon, given the year Chase just had. But to do so and simultaneously scold us that high compensation on Wall Street is just "shareholders rewarding performance," that's either Nobel-caliber chutzpah or laboratory-pure stupidity.

John Mack of all people should be quiet when it comes to the issue of public outrage over bank corruption. How about this, John: All of us malcontents will promise to stop beating up on your fellow CEOs, if you share with us the entire contents of your conversation with Pequot hedge fund honcho Art Samberg on June 29th, 2001?

Mack, readers may recall, was at the center of the controversy involving SEC whistleblower Gary Aguirre. Aguirre is a lawyer and investigator who began working for the SEC in September 2004. One of his first assignments was to look into a case involving a hedge fund called Pequot Capital Management, which had made a highly auspicious series of trades just ahead of, and after, a merger involving GE and a company called Heller Financial in the summer of 2001. The man making the deal was legendary Pequot trader Art Samberg.

As evidence in a Senate investigation into Aguirre's firing later revealed, Samberg made a huge investment in Heller on July 2nd, 2001, apparently without having done any research into Heller before that time. He had, however, talked the previous business day (Friday, June 29th) to John Mack, who had recently left a job running Morgan Stanley and had just returned from Switzerland, where he'd interviewed for a job with Credit Suisse. Both Morgan Stanley and Credit Suisse had worked on the merger for Heller financial. and, the Senate explained, "possessed material, non-public information about the deal."

Right after Mack talked to Samberg and Samberg invested in Heller, Pequot cut Mack in on a lucrative deal involving a Lucent spinoff that ended up more than tripling Mack's $5 million investment. When Aguirre asked permission to interview Mack about all of this, he was denied such permission by his superiors at the SEC. When he pressed, they fired him (Aguirre later won a wrongful termination settlement with the SEC in the amount of $755,000).

Ultimately, the government did not interview Mack about the Pequot deal until August 1st, 2006, exactly five days after the five-year statute of limitations on the incident had expired. In that testimony, Mack denied having foreknowledge of the Heller deal, and claimed that Samberg had wanted him to invest in the Lucent spinoff, not the other way around – despite the fact that the SEC had emails from Samberg saying Mack had nagged Samberg to let him into the lucrative deal, "busting his chops" to get in.

The government never really pursued the matter further and Mack's role in what the Senate called a "highly suspicious" trade was never fully investigated. He ultimately returned to Morgan Stanley to serve as the bank's CEO from 2005 to 2009.

All of which means exactly nothing today, over a decade after the original incidents. By now it's just one of a pile of stories about cases that never got made against Wall Street executives for questionable behaviors in the pre-crisis years.

Still, it seems to me that after having been saved by the gods from the jaws of death in the Heller episode, Mack should probably henceforth stay on the sidelines in any debate about financial corruption. That he doesn't should tell us a lot. I'm not sure these guys can even spell "shame," much less exercise any.

So Sheriff Andy Cuomo brings on Wall Street criminal John Mack to work the room when Cuomo goes to chat with other Wall Street criminals like Lloyd Blankfein and James Gorman.

What a cozy group of criminals Sheriff Andy is palling around with.

No wonder he had such a piss-poor record bringing indictments against Wall Street criminals when he was attorney general of New York State.

He's pals with them.

How You Will Know If De Blasio Sold Out To Rupert Murdoch

Democratic mayoral nominee Bill de Blasio, he of the "Tale of Two Cities" campaign, spent all yesterday meeting with the oligarchs of the city, including having a private and secret meeting with NY Post publisher Rupert Murdoch, NY Daily News publisher Mort Zuckerman, Goldman Sachs CEO Lloyd Blankfein and other members of the New York plutocracy.

The de Blasio campaign is sending out the message that de Blasio was simply meeting with the plutocrats to tell them he will not back down from his campaign pledge to break the inequality that has brought about the "Tale of Two Cities" divide in New York, a problem he has spoken so eloquently about all during the mayoral campaign.

But some of us wonder if that's what he was doing, why keep the meeting with Murdoch, Zuckerman, Blankfein, et al. secret?

What's to hide if he was simply laying down the law to the plutocrats that the times they are a changing and they either get with those changes or get swept away?

Might it be that de Blasio didn't actually send that message to the plutocrats, that instead there was another message sent which was meant to assuage the nervousness and anxiety of a bunch of rich white guys who have had their own way with the city for the last 20 years?

Call me a conspiracy nut if you will, but I have to admit, my "Hmmm..." meter goes up when I hear de Blasio has been having secret meetings with Rupert Murdoch and Mort Zuckerman even as he's holding fundraisers with the rich and well-heeled across the city, hitting them up for the maximum contributions while they have tea and crumpets with Dante and Dad.

Now I don't know what was discussed at the de Blasio/plutocrat meeting, but I suspect there were no policy particulars talked about.

Rather, I suspect that the boys at that meeting (and they were all boys unless Kathryn Wilde was there too) had a frank and honest discussion about what the phrase "campaign rhetoric" means and how campaign rhetoric often gets forgotten in the heat of governing.

While we can't know exactly what was discussed at the de Blasio/plutocrat meeting, we can get a sense of how the plutocrats received the message.

The NY Post, owned by Rupert Murdoch, has been hammering de Blasio heavily for the last few weeks, calling him everything from Sandanista Bill for his work with a Jesuit-relief group in Nicaragua in the 1980's to going after his father's suicide.

If the tone of the de Blasio coverage in the Post changes from heavy hammer job to a softer, more gentle approach, you will know that what Rupert Murdoch heard de Blasio tell the plutocrats at the de Blasio/plutocrat meeting made Rupert Murdoch feel better about Bill de Blasio.

The Post coverage of Cuomo often follows this trajectory as well.

They run suck-up pieces about Cuomo when he's doing what they want, they go after him when he's doing stuff they don't like.

Now that de Blasio has met and had a frank discussion with Rupert and his fellow plutocrats, that pattern of Post coverage will play out with Sandanista Bill.

If we suddenly get more measured coverage from the Posties, you will know that de Blasio sold you out.

Education Nation Should Invite Carrianne Howard To Talk About How Wonderful Lloyd Blankfein's Art Institutes Are

Raging Horse does an excellent job of pointing out who NBC should have invited for their corporate education reform-slanted Education Nation propaganda-fest this year.

Alas, NBC isn't much interested in having anybody on that stage who won't carry water for the corporate education reform agenda, so they only invited deformers like Michael Bloomberg, Jeb Bush, Joel Klein, Michelle Rhee, et al. to this year's Education Nation.

Even Diane Ravitch was only invited to sit in the audience, an outrageous insult to not only Ravitch but to every teacher in this country who has been slammed and smeared by corporate reforms like Klein, Rhee, et al.

But of all the corporate education reform-friendly guests NBC did invite, I find Goldman Sachs CEO Lloyd Blankfein the most outrageous.

You see, Goldman Sachs, in addition to being the most evil corporate entity on the planet, owns 41% of the parent company of the notorious for-profit swindle college, the Art Institutes.

Bloomberg News published a devastating expose of the Art Institutes and Goldman Sachs back in 2010 that found degrees from the Art Institutes essentially worthless, debt levels incurred by students at the schools extremely high.

They use the story of Carrianne Howard, a young woman who graduated from the Art Institute of Fort Lauderdale and now makes her living as a stripper, to show just what a scam the school is (that's Howard pictured above, with her Art Institute diploma):

Carrianne Howard dreamed of designing video games, so she enrolled in a program at the Art Institute of Fort Lauderdale, a for-profit college part-owned by Goldman Sachs Group Inc. Her bachelor’s degree in game art and design cost $70,000 in tuition and fees. After she graduated in December 2007, she found a job that paid $12 an hour recruiting employees for video game companies. She lost that job a year later when her department was shuttered.

These days, Howard, 26, makes her living in a way that doesn’t require a college diploma: by stripping at the Lido Cabaret, a topless club in Cocoa Beach, Florida. “I didn’t know what else to do,” she says. “I’ve got a worthless degree. It’s like I didn’t attend school at all.”

...

Carrianne Howard, the Florida student, didn’t borrow for her education. Instead her parents paid roughly $70,000 in tuition bills. Her mother, an airline data analyst, and her father, a computer engineer, sold their California home and moved to Virginia after her father lost his job and her mother retired. They used money from the sale to pay for tuition, and her parents are now struggling financially, Howard and her mother say.

Howard grew up in Valencia, California, a suburb of Los Angeles, and became drawn to video gaming during high school. One afternoon in 2004, an Art Institute ad popped up on her PC.

“I was as excited as can be,” she says. “I thought it was a dream come true.”

She and her mother toured the Fort Lauderdale campus, a bright, modern three-story building flanked by reflecting pools and palm trees. Her tour guide “just made it sound really exciting and a lot of fun, like I was going to make hundreds of thousands of dollars,” Howard says.

EDMC schools train representatives to make “no promise, implication, or guarantee” about employment, Muller says.

A couple of years into her studies, Howard says she grew disenchanted. Some classes consisted largely of playing video games, she says. She wanted to drop out but her mother insisted she finish because the family had spent so much already. She graduated in December 2007; in March 2009 she lost her first job, at GameRecruiter, a Fort Lauderdale-based gaming industry employment agency where she was making $12 an hour. Marc Mencher, GameRecruiter’s president and CEO, says she was let go only because he closed down her entire department, and calls her “an exceptional performer.”

She may be struggling to find work in part because of inadequate preparation from the Art Institute’s gaming department, Mencher says.

“It’s a weak program because it’s understaffed,” says Mencher, who serves on the Art Institute’s national advisory board for gaming programs. “I personally feel the students aren’t getting their money’s worth.”

After Bloomberg Businessweek asked EDMC for comment, Mencher sent a follow-up e-mail, saying that although the Art Institute is “not perfect and they have issues like any organization,” it is “an excellent program built on input from respected industry professionals along with local employers.” It has an “outstanding placement” record for graduates, he said.
Lido Cabaret

Howard applied for dozens of jobs, not only in gaming but also in grocery stores and nursing homes, mostly for minimum wage, she says. In October 2009, Howard turned to adult entertainment by doing paid Web chats. In March she started dancing at Lido Cabaret, earning $400 to $1,000 a week, she says.

She now hopes to save enough to go back to college and get a business degree. As she considers returning to school, Howard also helps run an anti-Art Institute website, where she has collected more than 70 names in a petition to send to the U.S. Education Dept.

The private, nonprofit Florida Institute of Technology, where Howard would like to enroll, won’t accept any of her credits from EDMC, according to spokeswoman Karen Rhine, because the Art Institute doesn’t have the kind of accreditation the traditional college requires. In its school catalog and other documents, the Art Institute “does not imply or guarantee” that credits will transfer to other universities, says EDMC’s Muller.

At 1 a.m. on a recent weeknight, Howard finished a shift at Lido. “This is what I do,” she says. “When I’m in here, I try not to think about the Art Institute.”

NBC ought to add Carrianne Howard or any of the other students who graduated from Art Institutes with a worthless degree and tens of thousands in debt to talk up the school.

But instead they invite banker criminal Blankfein instead.

In the past, they have had the CEO and head criminal of the University of Phoenix at Education Nation.

This year, the executive VP from Apollo Group, the owner of the University of Phoenix, will be there.

So every year, NBC doesn't miss a trick to not only invite every corporate deformer they can think of to sell the corporate deform agenda, but there's always a for-profit college criminal shill on the panel as well.

But no Diane Ravitch, no Anthony Cody, no Karen Lewis, no Susan Ohanian, no Lois Weiner, no actual working teachers who don't carry the ed deform message

And no students from one of these for-profit scam schools like Art Institutes or University of Phoenix to tell the audience how much debt they carry as they work at Starbucks or Applebees or, like Carrianne Howard, a strip club.

NBC's Education Nation ought to come with a scammer alert on the bottom of the screen.

The entire "symposium" is nothing but propaganda for the corporate education deform movement and for the criminal for-profit school industry.

The Faces Of Class Warfare

Wall Street CEO's, of course:

Incredulous that Wall Street investment bankers and billionaire CEOs have descended on Washington in the midst of ongoing budget talks to tell Americans that they should "lower their expectations" when it comes to the security of their retirement and future health care, Vermont Senator Bernie Sanders took to the Senate floor Thursday to call out the audacity of corporate-minded millionaires and billionaires, calling them the new "face of class warfare" in the United States.

"I find it literally beyond comprehension, that we have folks from Wall Street who received huge bailouts from the people of our country—from working families in this country—because of the greed and recklessness and illegal behavior, which Wall Street did to drive us into this recession, and now these very same people are coming here to Congress to lecture us and the American people about how we have to cut Social Security, Medicare, and Medicaid while they enjoy huge salaries and retirement benefits."

Sanders specifically called out CEO of Goldman Sachs, Lloyd Blankfein, who has recently been making both the media rounds and consulting with lawmakers regarding the ongoing tax and budget debate in Washington during the current lame duck session. Blankfein, one of the highest paid executives on Wall Street and worth hundred of millions personally, made the comments about 'lowered expectations' in a recent evening news interview with CBS and said that average Americans should understand that the US simply can't "afford" to maintain programs like Social Security and Medicare.

The facts of such sentiments, as many economists repeatedly point out, are false, but Sanders said that Blankfein delivered the familiar rightwing trope "with all the sympathy for someone struggling to get by on $14,000-a-year retirement that you’d expect from a Wall Street banker paid $16 million last year."

The chutzpah of Blankfein, whose firm Goldman Sachs directly benefited from the AIG bailout, is large but not surprising.

There is an arrogance to many of these corporate types, especially the CEO's and the hedge fundies, that they're smarter than everybody else, they're harder working than everybody else, and they deserve more than everybody else.

The reality is, the system is rigged in their favor and many of them are ethically-challenged anyway so even if it wasn't rigged in their favor they would steal their way to the top.

Witness Goldman where they sold worthless CDO's to their own clients, knowing those CDO's were worthless, than shorted the very same so that they could make money coming and going.

Why would anybody in government listen to a criminal like Lloyd Blankdfein?

Unfortunately it is because he is rich and he, along with the rest of the 1%, own those guys.

What is good for Lloyd Blankfein is bad for the rest of the country - but that won;t stop the geniuses in charge from giving him what he wants.

Bloomberg Outraged By NY Times Publishing Goldman Sachs Resignation Letter

The Mayor of the 1% criticized the New York Times for publishing Greg Smith's resignation letter to Goldman Sachs this week:

Michael Bloomberg, the mayor of New York City, said on Friday that not even God could lead Goldman Sachs without criticism, as he defended the investment bank’s head after a rare attack from within its own ranks.

Goldman has been battling a stream of negative press since Greg Smith, a middle-ranking derivatives salesman, resigned on Tuesday, publicly accusing Lloyd Blankfein, chief executive, of presiding over a “toxic” culture in which bankers were “ripping off clients” and referring to customers as “muppets”.


Mr Bloomberg said the attack on Mr Blankfein was ridiculous. “He’s trying to lead this firm at a time when God couldn’t lead it without being criticised,” the billionaire mayor, who started his own career as an investment banker, told the Financial Times.

...

The New York mayor, who founded one of the world’s biggest financial news and data organisations which counts Goldman among its clients, said “someday you can tell me” why The New York Times published the article, adding that it was “beyond me”.

That view was echoed by James Gorman, chief executive of Goldman rival Morgan Stanley, who also attacked the newspaper for publishing Mr Smith’s unsolicited article.

“To pick a random employee, I just don’t think it’s fair and I didn’t think it was balanced,” he said at an event hosted by Fortune magazine. “There but for the grace of God go us.”

Ah yes, these paragons of capitalism are so offended by the Times publishing Smith's resignation letter and making Goldman look like the evil company it is, but somehow they're not offended by New York City going back on its word by releasing the Teacher Data Reports that use a value-added measurement with a maximum margin of error of 87% to the press so that the NY Post and other papers could slander individual teachers with headlines like NEW YORK'S WORST TEACHERS.

Hypocrites.

It's also not a surprise that the Masters of the Universe who like to dish the abuse out can't take it when it's leveled back at them - in this case, quite fairly.

As the Bloomberg-owned Businessweek reported on March 15, Goldman Sachs is scummy at best in it's business practices.

Nothing Smith said was out of line and hasn't been reported before about Goldman.

It wasn't like his letter has a margin of error in it, let alone a MOE of 87%.

Yet somehow Bloomberg and Blankfein and the crook running Morgan Stanley are offended by the truth showing up in the Times.

Bloomberg Compares Goldman CEO To God

Well, Goldman Sachs CEO Lloyd Blankfein did say he's just a banker who does "God's work", so I guess it's not beyond the pale that Michael Bloomberg, the Mayor of the 1%, compared Blankfein to God today:

Michael Bloomberg, the mayor of New York City, said on Friday that not even God could lead Goldman Sachs without criticism, as he defended the investment bank’s head after a rare attack from within its own ranks.

...

Mr Bloomberg said the attack on Mr Blankfein was ridiculous. “He’s trying to lead this firm at a time when God couldn’t lead it without being criticised,” the billionaire mayor, who started his own career as an investment banker, told the Financial Times.

Poor Lloyd Blankfein.

Won't the mean people just stop picking on this good-hearted philanthropist and the company he leads?

Thank the heavens the Mayor of the 1% is there to defend poor defenseless Lloyd Blankfein and Goldman Sachs.

Little Tommy Friedman Wants To Take Stuff From You

Like a livable wage, a 40 hour work week, vacation, health care, a pension and Social Security - but only for working and middle class folks, of course.

From Dean Baker at The American Prospect:

Thomas Friedman told readers that: "But now it feels as if we are entering a new era, 'where the great task of government and of leadership is going to be about taking things away from people,' said the Johns Hopkins University foreign policy expert Michael Mandelbaum."

Unfortunately, Mr. Friedman apparently doesn't talk to anyone who has ever taken any economics. There are no serious forecasts that do not project that productivity will continue to grow for the indefinite future, and many project that productivity will grow at a more rapid pace than it did in the years from 1973-1995. This means that there is no reason, except incompetent economic management and/or the continuing upward redistribution of income, why the vast majority of the population should not experience improvements in living standards. This would mean an increase in both public and private services.

This is the meme that the corporate overlords have been selling for the last 20 years.

Times are tough and global competition is tough, so you are going to have to work longer and harder to make less money.

You're going to have to give up your 40 hour work week and employer-provided vacations and your employer-provided health care plan (if you're lucky enough to have one.)

You're going to have to delay your retirement and work longer and harder longer into your old age (but not at a good paying job, of course...you'll be laid off and stocking shelves at Walmart or delivering pizzas to college kids for those golden years...)

And that's if you can get a job at all. As the NY Times reported today, plenty of people who once lived middle class lives are unemployed, out of savings and nearing the end of their unemployment benefits.

Now of course the folks at the top - the Bloombergs, the Gateses, the Blankfeins, the Philip Falcones of the world - they'll be raking in gobs more money, sucking up more of the world's resources - while you're losing your stuff.

And according to Little Tommy Friedman, who lives in a 4,000 square foot house in Washington and writes books about how great the Indian economic system and education systems are, says there's nothing we can do about it.

About all we can do is get used to the new reality and socialize our kids to expect to work longer and harder for a lot less than we ever had to.

And that, of course, is where education reform and the charter school movement that forces a 60 hour/6 day work week onto kids, comes into play.

And notice who is driving the education reform/charter movement - the Bloombergs, the Gateses, the Blankfeins and the Philip Falcones of the world.

And they have Little Tommy Friedman and others of his ilk to to sell their jive in the media.

It's all so perfect.

Unless people wake up to it.

The problem is not education, the problem is not the American workforce.

The problem is that the corporate overlords are crooks and have rigged the system for themselves.

You can see the latest Matt Taibbi article for just how easily they've done it.

Until something is done to take care of the Bloombergs, the Gateses, the Blankfeins and the Philip Falcones of the world and the shills who sell their jive like Little Tommy Friedman, things are only going to get worse for the working and middle classes.

You can see the anger over a lot of this in the Tea Party Movement or the nutcase flying his plane into the IRS building in Austin.

But of course the crazies are directing their anger at the wrong people.

Sure the IRS and the federal government are stealing your money and screwing you over and over - but they're doing it for the Bloombergs, the Gateses, the Blankfeins, and the Philip Falcones of the world.