Month: April 2010

Clinton: Shouldn’t Have Listened To Rubin, Summers

~ susie ~ 8 Comments

In an interview on This Week with Jake Tapper, President Bill Clinton said he made a mistake listening to Bob Rubin and Larry Summers on derivatives, and said he should have tried to regulate them, despite Republican opposition:

TAPPER: One of the things that President Obama is pushing for is regulation of derivatives, and also with a thing called the Volcker rule, he’s trying to separate commercial banking interests from investment banking interests.These were things that were the opposite policies of Treasury Security Rubin and Summers at that time, do you think in retrospect they gave you bad advice on these issues?

CLINTON: Well, I think on the derivatives – before the Glass-Steagall Act was repealed, it had been breached. There was already a total merger practically of commercial and investment banking, and really the main thing that the Glass-Steagall Act did was to give us some power to regulate it – the repeal. And also to give old fashion traditional banks in all over America the right to take an investment interest if they wanted to forestall bankruptcy. Sadly none of them did that. Mostly it was just the continued blurring of the lines, but only about a third of all the money loaned today is loaned through traditional banking channels and that was well underway before that legislation was signed. So I don’t feel the same way about that.

I think what happened was the SEC and the whole regulatory apparatus after I left office was just let go. I think if Arthur Levitt had been on the job at the SEC, my last SEC commissioner, an enormous percentage of what we’ve been through in the last eight or nine years would not have happened. I feel very strongly about it. I think it’s important to have vigorous oversight.

Now, on derivatives, yeah I think they were wrong and I think I was wrong to take it because the argument on derivatives was that these things are expensive and sophisticated and only a handful of investors will buy them and they don’t need any extra protection, and any extra transparency. The money they’re putting up guarantees them transparency. And the flaw in that argument was that first of all sometimes people with a lot of money make stupid decisions and make it without transparency.

And secondly, the most important flaw was even if less than 1 percent of the total investment community is involved in derivative exchanges, so much money was involved that if they went bad, they could affect a 100 percent of the investments, and indeed a 100 percent of the citizens in countries, not investors, and I was wrong about that. I’ve said that all along. Now, I think if I had tried to regulate them because the Republicans were the majority in the Congress, they would have stopped it. But I wish I should have been caught trying. I mean, that was a mistake I made.

Rerun

~ susie

I’m really glad we invaded Iraq and saved them from a ruthless dictator who tortured and killed his own people — oops, I’m sorry, is this a rerun? (The video is from last year.) Via the L.A. Times:

Hundreds of Sunni men disappeared for months into a secret Baghdad prison under the jurisdiction of Prime Minister Nouri Maliki’s military office, where many were routinely tortured until the country’s Human Rights Ministry gained access to the facility, Iraqi officials say.

The men were detained by the Iraqi army in October in sweeps targeting Sunni groups in Nineveh province, a stronghold of Al Qaeda in Iraq other militant groups in northern Iraq. The provincial governor alleged at the time that ordinary citizens had been detained as well, often without a warrant.

Worried that courts would order the detainees’ release, security forces obtained a court order and transferred them to Baghdad where they were held in isolation. Human rights officials learned of the facility in March from family members searching for missing relatives.

Revelation of the secret prison could worsen tensions at a highly sensitive moment in Iraq. As U.S. troops are withdrawing, Maliki, a Shiite, and other political officials are negotiating over the formation of a new government. Including minority Sunni Arabs is considered by many to be a key to preventing a return of widespread sectarian violence. Already there has been an increase in attacks by Al Qaeda in Iraq, a Sunni extremist group. The alleged brutal treatment of prisoners at the facility raised concerns that the country could drift back to its authoritarian past.

Commanders initially resisted efforts to inspect the prison, but relented and allowed visits by two teams of inspectors, including Human Rights Minister Wijdan Salim. Inspectors said they found that the 431 prisoners had been subjected to appalling conditions and quoted prisoners as saying that one of them, a former colonel in Saddam Hussein’s army, had died in January as a result of torture.

“More than 100 were tortured. There were a lot of marks on their bodies,” said an Iraqi official familiar with the inspections. “They beat people, they used electricity. They suffocated them with plastic bags, and different methods.”