From Volume 38, Issue 38 of EIR Online, Published September 30, 2011

United States News Digest

Obama Demands Congress Pass Another $3 Trillion in Cuts

Sept. 19 (EIRNS)—Barack Obama today demanded on that Congress adopt his $4 trillion deficit reduction plan, by passing an additional $3 trillion in budget cuts.

In August, Congress and Obama enacted legislation to cut $1 trillion over the next 10 years, and established an unconstitutional super committee of 12 Congressmen to agree on another $1.2-$1.5 trillion in cuts by Nov. 23.

Now, Obama, still under British orders to "Go big!" on deficit reduction, is trying to play to his collapsing political base, by including a $447 billion "jobs" bill, and new taxes on the rich to "fully pay for it."

Lyndon LaRouche declared Obama is finished and unelectable. A New York Times poll on Sept. 18 reported that 80% of the American people see jobs building infrastructure as the way to a U.S. economic recovery.

Obama's "jobs" bill is "fully paid for" by cuts in payroll taxes for Social Security—a step to eliminating the funds which pay for the retirement plan. Obama also proposes "modest adjustments" to other Federal retirement programs," such as Medicare and Medicaid, by punishing hospitals for "readmissions"; and "reforming Medicare payments" to doctors and hospitals, causing them to go bankrupt or cut quality care. Obama proposes to increase patient costs by higher "deductibles" in 2017, 2019, and 2021; increasing home health-care copayments by $100 per episode; reduction of graduate medical education payments to teaching hospitals, and, of course, at the heart of Obamacare, "Strengthen the Independent Payment Advisory Board ["death panels", by reducing its growth rate target by half."

Obama's unconstitutional super committee must either agree on cuts by Nov. 23, or else defense and entitlement budget areas are automatically equally cut to achieve a balanced budget. (Unless the American people overturn the applecart.)

Postal Union President 'Outraged' at Obama

Sept. 23 (EIRNS)—Fred Rolando, President of the National Association of Letter Carriers (NALC), said Sept. 22 that he and the postal workers that he represents are "outraged" at President Obama for breaking his word and "embracing" the postal management plan to "dismantle the postal service." He said that the Postal Service is not bankrupt, and, in fact, has made $700 million profit for four years. In addition, the Postal Service is sitting on billions of dollars in over-payments to retirement plans which nobody disputes.

Rolando's strongest words against Obama were for breaking his word on maintaining Saturday mail delivery, which will not make the Postal Service stronger, but rather, less competitive. He said that Obama has no long-term plan for the Postal Service, and that the President's only sign of compromise was on the idea of giving a 90-day grace period for the $5.5 billion payment for the future retirees. (Rolando pointed-out that paying 75 years of future employee health and retirement benefits are for employees who have not even been born yet!) But Rolando emphasized that even Obama's 90-day grace period is not a solution, and Congressional action is required to change the retirement plan to that of other federal agencies.

Obama Administration Hired Lazard To Plan Solyndra's Bankruptcy

Sept. 23 (EIRNS)—In early August, the Obama Administration's Department of Energy brought in Lazard Ltd.—the "investment bank" formerly run by that fascist Felix Rohatyn—to plan the impending restructuring and bankruptcy of Obama's pet Solyndra solar-power boondoggle.

The Sept. 22 Washington Times reported that six days before the Solyndra bankruptcy, DOE signed a no-bid contract with Lazard for $1.1 million, with the contract being effective as of ten days earlier, on Aug. 12. One of the unexplained aspects of this deal, is why the DOE, rather than Solyndra itself, retained the Lazard firm.

This means that as of early August, planning was underway for a Solyndra bankruptcy. Yet throughout July, Solyndra executives were marching up and down the halls of Congress, presenting a rosy picture of the firm's future.

The Wall Street Journal reports that on Sept. 27, Solyndra will ask a bankruptcy court for permission to auction off its assets, which it wants to do on Oct. 28. Meanwhile, House Judiciary Committee chairman Lamar Smith has asked Attorney General Eric Holder to appoint an outside investigator to probe whether the Obama Administration's conduct in granting the loan guarantee to Solyndra was politically motivated.

Counties To Sue Banks Over Fraudulent Foreclosure Practices

Sept. 23 (EIRNS)—In addition to the state attorneys general negotiating penalties on the banks and the Mortgage Electronic Registration Systems Inc. (MERS) for filing foreclosures with fraudulent documents, a number of counties are now preparing to sue major banks for using MERS to avoid paying filing fees with the counties. In fact, MERS' website boasts that its system is specifically designed to avoid paying the fees to county clerks, according to an April 25 filing by the Dallas County District Attorney in Texas state court, in which Dallas demands payment of as much as $100 million in missed filing fees. MERS president R.K. Arnold testified in 2009 that assuming each mortgage has been resold and recorded just once, it would have saved the industry $2.4 billion in recording expenses.

The Dallas suit names Bank of America and MERS, which is owned by financial institutions including Citigroup, JPMorgan Chase, Wells Fargo, industry trade groups, and Fannie Mae and Freddie Mac. Other counties around the country are watching closely, with similar actions in preparation. MERS, by claiming it was the "mortgagee of record" as long as the note promising repayment was owned by a MERS member, foreclosed on millions of homes without actually owning the mortgage, while also allowing banks to buy and sell loans without properly recording transfers with counties and paying the fee.

County clerks in Kentucky have also sued MERS, while officials in Massachusetts, Delaware, and Michigan say they are exploring the possibility.

More Support for Glass-Steagall Bill

Sept. 26 (EIRNS)—On Sept. 17, the Louisiana State Central Democratic Committee and the Washington State Democratic Central Committee each passed resolutions in support of a return to Glass-Steagall. They are the first two statewide Democratic Committees to do so.

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