McCain Campaign Economic Adviser, Phil Gramm, Responsible for Enron Fiasco, Sub-Prime Mortgage Mess and High Gas Prices, Producer of Two Porn Movies, Calls Americans a Bunch of Whiners

As chairman of the Senate Banking committee, Phil Gramm sheparded the passage of the Gramm-Leach-Bliley Act of 1999 which effectively repealed the Glass-Steagall Act of 1933 which put a firewall between commercial and investment banking. After the Gramm-Leach-Bliley Act went into effect, Citibank merged with Travelers Group, an insurance company, in 1997 forming Citigroup. Other mergers among investment banks, commercial banks and insurance companies took place forming the financial services industry. The sub-prime mortgage mess was a direct consequence of the Gramm-Leach-Bliley Act since it allowed commercial banks to give mortgages to customers and then offload those mortgages to investment banks who formed mortgage backed securities and collateralized debt obligations and sold these off to investors. There was litlle oversight or accountability in this process because, after all, the purpose of Gramm-Leach-Bliley was to deregulate the financial services industry. Gramm had received over $4.6 million in campaign contributions from the finance, insurance and real estate industries.

Gramm had also been responsible for the "Enron loophole" which had made possible the Enron debacle after having accepted large campaign contributrions from Enron. It just so happened that Gramm's wife, Wendy, was on Enron's board. The Commodity Futures Modernization Act resulting from a 256 page amendment which Gramm clandestinely slipped into a $384 billion omnibus spending bill in 2000, exempted energy trading from regulatory oversight and led directly to Enron "screwing Grandmas" in California by raising their electric bills precipitously.

Shortly after George W. Bush was elected president, Congress and President [Bush] were trying to pass a $384 billion omnibus spending bill, and while the debates swirled around the passage of this bill, Senator Phil Gramm clandestinely slipped a 262-page amendment into the omnibus appropriations bill titled: Commodity Futures Modernization Act. It is likely that few senators read this bill, if any. The essence of the act was the deregulation of derivatives trading (financial instruments whose value changes in response to the changes in underlying variables; the main use of derivatives is to reduce risk for one party). The legislation contained a provision -- lobbied for by Enron, a major campaign contributor to Gramm -- that exempted energy trading from regulatory oversight. Basically, it gave way to the Enron debacle and ushered in the new era of unregulated securities. Interestingly enough, Gramm's wife, Wendy, had been part of the Enron board, and her salary and stock income brought in between $900,000 and $1.8 million to the Gramm household, prior to the passage of the Commodity Futures Modernization Act.

Let's see ... Enron, sub-prime mortgage mess ... that's 2 out of 3 fiascos directly attributable to Phil which in and of themselves have contributed big time to the wrecking of the American economy. And he wants to be McCain's Treasury Secretary? This is the guy McCain is taking advice from about the economy? OK, how about high gas prices? They are the result, at least in part, of speculation on the commodities exchange. The Commodities Futures Modernization Act of 2000 allowed for all kinds of derivatives trading in oil without any regulatory oversight. Many think that at least half of the high price of oil is caused by speculators in oil futures. And here's Gramm's wife, Wendy, right in the middle of this fiasco too as chairman of the Commodities Futures Trading Commission. The Gramm family philosophy: profit uber alles! It used to be that public service was altruistic. Now public service is strictly for private profit.

Part of that deregulation involved rulings of the U.S. Commodity Futures Trading Commission, then chaired by Wendy Gramm, who upon retiring from that post became a highly compensated member of the Enron board of directors, serving for eight years. She even was on the board’s audit committee during the time of the corporation’s despicable financial shenanigans. While on the Enron board, Wendy Gramm also chaired an anti-regulatory think tank that received funding from Enron and other corporations that benefited directly from the policies her institute espoused.

So it looks like the fox was guarding the henhouse. Between Phil Gramm and his wife, Wendy, a sledgehammer was taken to the US economy. With friends like these, American "whiners" don't need any enemies. But wait there's more. In a post, Phil Gramm: Porn Mogul, Marc McDonald writes:

However, let it not be said that Gramm didn't at least attempt to make a living in the private sector (in fact, the most private sector of all). As The Nation pointed out, before Gramm joined the Christian Coalition's Ralph Reed to call for defunding the NEA, he was an active investor in soft-core porn movies. In 1973, Gramm cut a check for $15,000 to invest in a budget soft-core production called Truck Stop Women. Because the film was oversold, his money was returned to him. Later, Gramm contributed at least $7,500 toward a film called White House Madness, a satire of the Nixon White House that featured a crazed president wandering around the White House in the nude. Gramm lost his investment after the film flopped at the box office.

After Gramm left the Senate to "spend more time with his family," naturally he was offered a lucrative job with UBS bank, having greased their palm as chairman of the Senate Banking Committee. UBS bank is being sued as a result of its participation in the sub-prime mortgage mess, just desserts for a bank employing Phil Gramm as its lobbyist, and has lost more than $18 billion. The suit claims  "that UBS 'appears to have condoned actions which benefited only itself, at the expense of its clients.'" Gee, it sounds like a bank after Phil Gramm's own heart.

You know it's hard to fathom how one man, together with his wife, could do so much damage to an economy as massive as the US. And singlehandedly bringing down the American economy may also result in a worldwide depression. Phil Gramm, may you be hoisted on your own pitard! And that goes for Wendy too. According to CNN, Gramm has resigned as chairman of McCain's electoral campaign. Gee, I wonder why? Why has this good man, porn producer, hypocrite-in-chief and rightful oberver that America is a "nation of whiners" been forced to resign? Is there no justice?

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[AN NGUYEN]

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