So, the speeches Hillary Clinton made to her rich, greedy Wall
Street cronies are starting to pay off.
Former Goldman Sachs Group Inc. Chairman Henry M.
"Hank" Paulson Jr. who was Treasury secretary under President George W. Bush announced
that he will vote for Hillary Clinton. What a surprise.
So, just who is Hank Paulson? Below are two
articles, written during the time Paulson became President Bush's Treasury secretary.
Here are the most damning parts of the article published by The Washington Post about Paulson after the 2008 financial crisis:
"The plan to rescue the US financial industry arrogates virtually unlimited money and power over the financial affairs of the state to the office of Treasury Secretary Henry Paulson. Paulson is a figure with a long history of intimate connections to the political and financial elite.
---
"Paulson then handsomely benefited from the speculative boom. This wealth was based on financial manipulation and did nothing to create real value in the economy. On the contrary, the extraordinary enrichment of individuals like Paulson was the corollary to the dismantling of the real economy, the bankrupting of the government, and the impoverishment of masses the world over.
"Paulson was compensated to the tune of $30 million in 2004 and took home $37 million in 2005. In his career at Goldman Sachs he built up a personal net worth of over $700 million, according to estimates."
________________
Blameworthy
Hank
Paulson
Photo Illustration; Paulson: Susan Walsh / AP; Getty
When Paulson left the top job at Goldman Sachs to become
Treasury Secretary in 2006, his big concern was whether he'd have an impact. He
ended up almost single-handedly running the country's economic policy for the
last year of the Bush Administration. Impact? You bet. Positive? Not yet. The
three main gripes against Paulson are that he was late to the party in battling
the financial crisis, letting Lehman Brothers fail was a big mistake and the
big bailout bill he pushed through Congress has been a wasteful mess.
________________
Who is Henry Paulson?
By Tom Eley
23 September 2008
The plan to rescue the US financial industry arrogates
virtually unlimited money and power over the financial affairs of the state to
the office of Treasury Secretary Henry Paulson. Paulson is a figure with a long
history of intimate connections to the political and financial elite.
In 1970, fresh from the Masters program of the Harvard
Business School, Paulson entered the Nixon administration, working first as
staff assistant to the assistant secretary of defense. In 1972-73, Paulson
worked as office assistant to John Erlichman, assistant to the president for
domestic affairs. Erlichman was one of the key figures involved in organizing
President Richard Nixon’s notorious “plumbers” unit that carried out illegal
covert operations against the president’s political opponents, including
espionage, blackmail, and revenge. Ehlichman resigned in 1973, and in 1975 he
was convicted of obstruction of justice, perjury, and conspiracy, and was
imprisoned for 18 months.
Utilizing his connections, Paulson went to work for
Goldman Sachs in 1974. In a 2007 feature, the British newspaper the Guardian
wrote, “Not only was he well connected enough to get the job [in the Nixon
White House], but well connected enough to resign in the thick of the Watergate
scandal without ever getting caught up in the fallout. He went straight to
Goldman back home in Illinois.”
Paulson rose through the ranks of Goldman Sachs, becoming
a partner in 1982, co-head of investment banking in 1990, chief operating
officer in 1994. In 1998 he forced out his co-chairman Jon Corzine “in what
amounted to a coup,” according to New York Times economics correspondent Floyd
Norris, and took over the post of CEO.
Goldman Sachs is perhaps the single best-connected Wall
Street firm. Its executives routinely go in and out of top government posts.
Corzine went on to become US senator from New Jersey and is now the state’s
governor. Corzine’s predecessor, Stephen Friedman, served in the Bush
administration as assistant to the president for economic policy and as chairman
of the National Economic Council (NEC). Friedman’s predecessor as Goldman Sachs
CEO, Robert Rubin, served as chairman of the NEC and later treasury secretary
under Bill Clinton.
Agence France Press, in a 2006 article on Paulson’s
appointment, “Has Goldman Sachs Taken Over the Bush Administration?” noted
that, in addition to Paulson, “[t]he president’s chief of staff, Josh Bolten,
and the chairman of the Commodity Futures Trading Commission, Jeffery Reuben,
are Goldman alumni.”
“But the flow goes both ways,” the article continued,
“Goldman recently hired Robert Zoellick, who stepped down as the US deputy
secretary of state, and Faryar Shirzad, who worked as one of Bush’s national
security advisors.”
Prior to being selected as treasury secretary, Paulson
was a major individual campaign contributor to Republican candidates, giving
over $336,000 of his own money between 1998 and 2006.
Since taking office, Paulson has overseen the destruction
of three of Goldman Sachs’ rivals. In March, Paulson helped arrange the fire
sale of Bear Stearns to JPMorgan Chase. Then, a little more than a week ago, he
allowed Lehman Brothers to collapse, while simultaneously organizing the
absorption of Merrill Lynch by Bank of America. This left only Goldman Sachs
and Morgan Stanley as major investment banks, both of which were converted on
Sunday into bank holding companies, a move that effectively ended the existence
of the investment bank as a distinct economic form.
In the months leading up to his proposed $700 billion
bailout of the financial industry, Paulson had already used his office to dole
out hundreds of billions of dollars. After his July 2008 proposal for $70
billion to resolve the insolvency of Fannie Mae and Freddie Mac failed, Paulson
organized the government takeover of the two mortgage-lending giants for an
immediate $200 billion price tag, while making the government potentially
liable for hundreds of billions more in bad debt. He then organized a federal purchase
of an 80 percent stake in the giant insurer American International Group (AIG)
at a cost of $85 billion.
These bailouts have been designed to prevent a chain
reaction collapse of the world economy, but more importantly they aimed to
insulate and even reward the wealthy shareholders, like Paulson, primarily
responsible for the financial collapse.
Paulson bears a considerable amount of personal
responsibility for the crisis.
Paulson, according to a celebratory 2006 BusinessWeek
article entitled “Mr. Risk Goes to Washington,” was “one of the key architects
of a more daring Wall Street, where securities firms are taking greater and
greater chances in their pursuit of profits.” Under Paulson’s watch, that meant
“taking on more debt: $100 billion in long-term debt in 2005, compared with
about $20 billion in 1999. It means placing big bets on all sorts of exotic
derivatives and other securities.”
According to the International Herald Tribune, Paulson
“was one of the first Wall Street leaders to recognize how drastically
investment banks could enhance their profitability by betting with their own
capital instead of acting as mere intermediaries.” Paulson “stubbornly
assert[ed] Goldman’s right to invest in, advise on and finance deals,
regardless of potential conflicts.”
Paulson then handsomely benefited from the speculative
boom. This wealth was based on financial manipulation and did nothing to create
real value in the economy. On the contrary, the extraordinary enrichment of
individuals like Paulson was the corollary to the dismantling of the real
economy, the bankrupting of the government, and the impoverishment of masses
the world over.
Paulson was compensated to the tune of $30 million in
2004 and took home $37 million in 2005. In his career at Goldman Sachs he built
up a personal net worth of over $700 million, according to estimates.
After Paulson’s ascension to the treasury, his colleagues
at Goldman Sachs carried on the bonanza. At the end of 2006, Paulson’s
successor Lloyd Blankfein was handed over a $53.4 million year-end bonus, while
11 other Goldman Sachs executives raked in $150 million in year-end bonuses
combined. That year, the top investment firms Goldman Sacks, Morgan Stanley,
Merrill Lynch, Lehman Brothers, and Bear Stearns handed out $36 billion in
bonuses. At the end of 2007, the executives of the same firms, excepting
Merrill, were handed another $30 billion.
