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July 15, 2002
Rahul Mahajan
Justice
for Bhopal
Jeffrey St. Clair
Seduced
by a Legend
The Return of Jimmy T99 Nelson
July 14, 2002
Bill Christison
The
DOA (Poem)
David Vest
I'll Never
Get Out of This Band Alive
July 13, 2002
M. Junaid Alam
A Process
of Dehumanization
Gavin Keeney
Go Tell
Karl Rove!
Matt Vidal
Corporate
"Ethics" Red Herrings
Ed Whitfield
Lessons
from Independence Day
July 12, 2002
Sean Donahue
The Other
Harken Energy Scandal: Oil, Death Squads
and Colombia
Walt Brasch
Sin Tax
Scam
"Psst. Cigarettes. A Buck Each."
Steve Perry
A Tale
of Two Twits
Wall Street Burns, Bush Fiddles, But Where's Wellstone?
July 11, 2002
Lloyd Marbet
Arrested
by the Chamber
of Commerce
David Krieger
Law vs.
Force
David Vest
Fountain
of Foo:
Strike Three Called
Irit Katriel
A Deep
Ideological Crisis
Richard Glen Boire
Dangerous
Lessons:
Public School Drug Testing
July 10, 2002
CounterPunch Wire
Third Party
Woes
South Carolina Denies Kevin Alexander Gray Ballot Status
Nassar Ibriham &
Majed Nassar
Bush's
Middle East Plan: Always Changing, Never Changing
Robert Fisk
Ain't That
America:
A Strange Kind of Freedom
Dave Marsh
The Return
of CREEP:
Record Cartel Accounting
Bernard Weiner
Hope and
Despair in
the Body Politic
Gary Leupp
European
Worries and
Bush's Terror War
July 9, 2002
St. Clair / Cockburn
The Atomic
Clock is Ticking:
All Roads Lead to Yucca Mtn.
Jack McCarthy
Florida:
a Terrorist Sanctuary for Bush's Bloody Pals?
Robert Fisk
How a Saudi
Billionaire
Does Beirut
Stanton and Madsen
God, Incorporated
Kurt Nimmo
IDF, Gangbanging
with Tanks
Bill Christison
Disastrous
Foreign Policies
of the US Part 3:
What Can We Do About It?
July 8, 2002
Rick Mercier
Yucca
Mountain Bound
Lev Grinberg
The
BUSHARON Global War
Tariq Ali
How Bush
Used 9/11 to Remap the World
Lori Allen
The Tugs
of War:
Palestinian Life Under Curfew
July 7, 2002
Alexander Cockburn
White
House Crooks
Resources:
100s of Links
About 9/11
CounterPunch:
Complete
Coverage of 9/11 and Its Aftermath
Five
Days That
Shook The World:
Seattle and Beyond
By Alexander
Cockburn
and Jeffrey St. Clair
Photos by Allan Sekula
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Published March 15, 2002
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How the CIA's Backing of the Mujahideen Created the World's Most
Robust Heroin Market and Helped to Finance the Rise of the Taliban
and Osama bin Laden
Whiteout:
CIA, Drugs & the
Press
by Alexander
Cockburn
and Jeffrey St. Clair
The Memphis Blues Again:
Six Decades of Memphis Music Photographs
Photos by Ernest Withers
Text by Daniel Wolff
The New Intifada:
Resisting Israel's Apartheid
Edited by Roane Carey
A Pocket Guide to
Environmental Bad Guys
by James Ridgeway
and Jeffrey St. Clair
The
Phoenix Program
by Douglas Valentine
Al Gore:
A User's Manual
by Cockburn
and St. Clair
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This Explosive
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Amazing Discount!
Reviews of Gore:
a User's Manual
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July
15, 2002
The Secret World of Banking
by Ralph Nader
All the headlines about corporate disclosures
and the need for transparency are sending shivers through the
banking industry and its regulators who have always lived in
a protected and largely secret world.
Hundreds of millions of dollars are expended
on examinations of depository institutions, but most of the key
findings are treated as inside information between the bankers
and the regulators who see a mutual advantage in keeping the
 depositors and investors-and even Members
of Congress-in the dark about the gritty details of their performance.
Only when an institution actually fails and taxpayer-backed deposit
insurance funds are lost do the hard facts of mismanagement and
regulatory miscues become public knowledge.
The lack of timely disclosures about
bank conditions arose a few weeks ago when a recess appointee
to the Securities and Exchange Commission, Cynthia Glassman,
suggested that the so-called "Camel ratings" of banks
be made available to the public. Camel ratings compiled by the
regulators are evaluations based on examiners' and supervisors'
assessment of six factors: capital, asset quality, management,
earnings, liquidity, and sensitivity to risk. Performance is
based on numerical ratings of 1 to 5-with five designated as
the worst.
Ms. Glassman's suggestion produced an
immediate uproar among regulators and the bank lobbyists. Comptroller
of the Currency John Hawke, who spent most of his career as a
big-time bank lawyer and lobbyist, immediately sent his spokesman
out to denounce the idea of public disclosure, contending that
the Camel ratings were an "internal tool of the regulators."
Other opponents suggested that disclosure
of the ratings might cause a "run" on a bank by scared
depositors. This brings back memories of the savings and loan
collapse in the 1980s when the Chairman of the Federal Home Loan
Bank-Danny Wall--continued to paint rosy pictures and withhold
bad news from the public while behind the scenes the savings
institutions rotted and edged toward failure. At one point, Wall
barged into the offices of the General Accounting Office in an
attempt to block the release of a critical report citing mounting
losses and increasing drains on the deposit insurance runs. And
the friends of the savings and loans in key positions on Capitol
Hill were all too happy to gloss over the worsening conditions
until it was too late.
The costs to the taxpayers and the savings
and loan industry increased greatly under this blanket of secrecy.
The public release of the Camel ratings would make it impossible
for regulators and banks to hide conditions and let problems
mushroom into disasters ala the savings and loan collapse. And
as the SEC's Ms. Glassman asks "why shouldn't investors
[as well as depositors] have this information."
Richard Carnell, a professor of law at
Fordham University and former Assistant Secretary of the Treasury,
wholeheartedly endorses the idea of public disclosure of the
Camel ratings, arguing that the disclosure would "facilitate
constructive criticism of how bank regulators measure risk."
Carnell was one the key staffers on the Senate Banking Committee
who urged action on the savings and loan crisis in the 1980s
and crafted many of the reforms after the collapse.
Rather than facing the market discipline
which full disclosure would help instill, the banks and other
depository institutions prefer to utilize a costly deposit insurance
system as a tranquilizer for the public. As thespeculation by
the savings and loans revealed in the 1980s, the taxpayer-backed
insurance creates a moral hazard that encourages excessive risk
taking.
Throughout this Congress, much of the
banking industry has been on Capitol Hill in an intensive lobbying
campaign to have taxpayer-backed deposit insurance increased
from its present limit of $100,000 per depositor to as much as
$150,000 plus indexing for future inflation. The present $100,000
limit was pulled out of thin air in 1980 by a handful of House-Senate
conferees seeking a means of helping the ailing savings and loans
attract deposits in competition with big money center banks.
Actually, under loopholes, a family of four could keep as much
as two million dollars in insured accounts in a single institution.
The secrecy maintained by federal regulators
combined with the tranquilizer of the massive deposit insurance
program effectively takes the public out of the debate about
banking policy. As a result, it is difficult to build public
opinion about legislative and regulatory actions which impact
on the safety and soundness-not to mention the efficiency--of
banking corporations, and ultimately on the health of the deposit
insurance funds.
That was certainly the case in 1999 when
the combined lobbying forces of banks, securities firms and insurance
companies pushed through a near total rewrite of the nation's
financial laws which authorized the formation of huge nationwide
financial conglomerates-with little or no protections for consumers
or the taxpayers who stand behind the deposit insurance funds.
So, the idea advanced by a lone member
of the Securities and Exchange Commission for disclosure of the
regulators' ratings of banks is a welcome development in this
desolate desert of secrecy which surrounds the banking industry.
But, don't expect the banks or their regulators to agree voluntarily
to come out in the sunshine. It is too convenient to leave bank
regulation asan inside-game. The same is true for the Congress-particularly
the House and Senate Banking Committees-which prefer to legislate
favors for the industry without being bothered with messy facts
in the hands of their voters back home.
But the Enrons, the Worldcoms and the
Global Crossings-among others-are placing a new premium on open
disclosure. Perhaps, the sunshine may ultimately reach the musty
dark corners of the secret world of banks and bank regulation.
Today's Features
Rahul Mahajan
Justice
for Bhopal
Jeffrey St. Clair
Seduced
by a Legend
The Return of Jimmy T99 Nelson
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