Courtesy of Pam Martens
U.S. Treasury Secretary Steve Mnuchin
President Donald Trump has been sacking federal watchdogs at the speed of a bullet train. In just a six-week period in April and May, the President fired five Inspectors General of federal agencies. In last Friday night’s coup d’état, Attorney General William Barr, acting as consigliere for the President, ousted the U.S. Attorney for the Southern District of New York, the federal prosecutor that oversees prosecutions of Wall Street banks in that district. The privately owned Federal Reserve Bank of New York, which is in charge of the bulk of the Fed’s bailout programs, also resides in that district.
Barr and the President want to put a man with zero experience as a prosecutor in charge of that office, Jay Clayton, who currently heads the Securities and Exchange Commission which has only civil enforcement powers. Clayton represented 8 of the 10 largest Wall Street banks in the three years before going to the SEC as a partner at Sullivan & Cromwell.
Unfortunately, watchdogs and prosecutors are what American citizens need the most right now as vast sums of money are unaccounted for at both the Treasury and Federal Reserve.
The stimulus bill known as the CARES Act was signed into law by the President on March 27, 2020. It called for “Not more than the sum of $454,000,000,000…shall be available to make loans and loan guarantees to, and other investments in, programs or facilities established by the Board of Governors of the Federal Reserve System for the purpose of providing liquidity to the financial system that supports lending to eligible businesses, States, or municipalities.” In addition, if the Treasury had any of its $46 billion left over that Congress had allotted in the CARES Act to assist airlines or national security businesses, that was to be turned over to the Fed as well.
The CARES Act was passed almost three months ago at the outset of the worst economic upheaval since the Great Depression. One would have thought that the urgency with which Congress acted to pass the legislation would have resulted in rapid deployment of the $454 billion to the Fed to help shore up the economy.
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