After watching the hearings with Treasury Secretary Henry Paulson, the former Goldman-Sachs CEO, I was struck by Henry Paulson’s insistence that his plan was the only one that would help restore liquidity to the market. His constant reference to “helping farmers” and his only concern being “to help the American Taxpayer” reveals where Mr. Paulson stands on the financial bail-out:

He thinks we are stupid.

Therefore he has issued the following statement as part of his simple, 3-page bailout request:

“Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.”

While members of Wall Street begged for deregulation and pursued their “greed is good” and “free market” philosophies, they gave themselves record bonuses while the average American was being forced out of their homes through foreclosures. At the same time that Main Street was literally being gutted via the housing market and sub-prime mortgage crisis, Wall Street firms were engaging in practices that they knew could only lead to disaster if the markets were ever to go down.

This is similar to the Enron debacle, where deregulation of the energy market allowed the “greed is good” institution to manipulate energy to their benefit and to the public’s detriment. California had to endure rolling blackouts, used as a method of extortion by Enron, making it critical that California act rapidly to stem the energy crisis. Thus, the perceived solution by Governor Gray Davis was to protect the citizens of California and hand Enron even more money, thinking that this would allow the rolling blackouts to cease.

To realize how much of a joke this was to Enron, I recommend that you watch the DVD about Enron, “The Smartest Guys in the Room“.  You will see a side of human nature that is sad and pathetic.  You will see millionaires who have become morally and spiritually bankrupt.

When you watch this DVD documentary it becomes apparent that this is not the typical “greed is good” crowd, but rather “greed gone wild”.

Enron’s market manipulations did not become apparent until their markets began to collapse, revealing how massive the fraud perpetuated on the American people truly was. As Enron unraveled, it became obvious that if Enron had “The Smartest Guys in the Room”, Enron had only one opinion of Main Street America:

They thought we are stupid.

Now, we have markets collapsing again, and the massive fraud and lack of transparency of the credit default swap markets have once again allowed us to peer inside the black box at the heart of Wall Street’s “greed gone wild” financial institutions.  Henry Paulson describes the situation as “complex”.

The answer that the Treasury Secretary has proposed is to enable Mr. Paulson to undertake actions, using 700 billion dollars of tax-payer money, that are “non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency”.

The stipulation that these actions have no oversight, no transparency, and no judicial review, form the heart of the real “Bush Doctrine“, not the one Sarah Palin was ignorant of regarding preemptive strikes of other countries.

The Treasury Secretary has made a proposal that lack of transparency and lack of oversight are the key components of rescuing the American taxpayer.  In reality, we are being asked to bail out the same markets using the same methods that placed us in this situation.

As Sarah Palin would say, “Thanks, but no thanks!”

Do you think that Secretary Paulson has Main Street America’s concern as his primary focus?

To answer that, consider this aspect of his resume from Wikipedia:

From 1990 to November 1994, he was co-head of Investment Banking, then, Chief Operating Officer from December 1994 to June 1998;^[8] eventually succeeding Jon Corzine (now Governor of New Jersey) as its chief executive. His compensation package, according to reports, was US$37 million in 2005, and US$16.4 million projected for 2006.^[9] His net worth has been estimated at over US$700 million.^[9] Paulson has personally built close relations with China during his career. In July 2008 it was reported by The Daily Telegraph that: “Treasury Secretary Hank Paulson has intimate relations with the Chinese elite, dating from his days at Goldman Sachs when he visited the country more than 70 times.”^[10]

It is interesting that Paulson believes that the American taxpayer is dependent on Wall Street and the markets functioning efficiently.  Yet, when times are good, the financial tycoons of industry believe they may act with impunity, and that no one’s fortunes matter but their own.

Wall Street has a give-and-take relationship with Main Street America.  We give and they take.