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New `Pecora Hearings' Target:
The Slush Fund of the Summers Gang

April 17, 2009 (EIRNS)—When the widely proposed Federal probe into the criminal financiers' blowout and bailout takes place, an inevitable target will be the role of Obama economic adviser Lawrence Summers and his personal clique of "behavioral economists," who have taken control over the President's policymaking in the present systemic collapse.

Investigators will hone in on tens of billions of dollars in private assets controlled by the clique; how these funds have paid for the rise of the clique to national power, and have led to vast personal wealth for Summers and his circle; and the possible generation of these funds through criminal activity.

An institutional base for the "behavioral economists" is the National Bureau of Economic Research (NBER), a think tank located next door to Harvard University in Cambridge, Massachusetts.

NBER states that its "workshop in behavioral economics" has been sponsored since 2001 by three private firms: "Bracebridge Capital, Fuller & Thaler Asset Management, and LSV Asset Management."

The smallest of the three interlocking funds, with about $1 billion in assets, is Fuller & Thaler. Its boss Richard Thaler founded and has directed the NBER program since 1991. Thaler helps coordinate the Summers gang's policy control through Thaler's close associates Austan Goolsbee (Obama Presidential campaign chief economist), and Cass Sunstein (now chosen as Federal Regulatory Czar). Goolsbee and Sunstein have been fellow professors with Thaler at the University of Chicago.

The next largest fund sponsoring the NBER program is Bracebridge Capital, with over $3 billion and possibly double that in assets under management. Bracebridge is apparenty named for Bracebridge Road in Newton, Massachusetts, where Bracebridge owner Nancy Zimmerman and her husband Andrei Shleifer live.

Harvard Professor Shleifer is Lawrence Summers' protege and personal international agent. Shleifer's own fortune is estimated in the hundred of millions, perhaps a billion dollars. This wealth was generated in the 1990s Summers/Shleifer/Harvard scandal in Russia. Summers, then a World Bank official, had sent Shleifer to Russia to run a U.S.-funded program to privatize Soviet assets into private hands; boss Summers guided the Russian officials Shleifer was advising. The program collapsed when Shleifer was caught diverting and hiding the assets for himself, using his wife's firm.

The Shleifer family firm now known as Bracebridge paid $1.5 million in 2004, to settle a U.S. government suit charging that Shleifer and his wife's firm had "improperly used USAID-funded resources and staff and ... diverted US taxpayer resources for its own purposes and profit.... Andrei Shleifer ... was the head of the Harvard Russia Project .... [which] was ... terminated after the USAID ... Inspector General uncovered evidence that Shleifer [and his confederates] were making investments in Russia and assisting their wives in establishing businesses in Russia.... using their influence with Russian government officials to obtain favorable licensing, funding, and other benefits for themselves and their wives in violation of the terms of the agreement between USAID and Harvard." Harvard and Shleifer himself later paid more millions to settle the Feds' suit. Summers became President of Harvard in 2001 and blocked any investigation of Shleifer and himself.

The Bracebridge firm that now sponsors the NBER program had been started by Zimmerman in 1994, at the height of the Russia-looting scheme, under the name Farallon Fixed Income Associates; changed its name to Bracebridge in 1998 after Summers and his associates had turned Russia over to gangsters and looters; later changed its name to the original "FFIA" acronym; and then finally reverted to "Bracebridge."

The largest private fund sponsoring the NBER program is LSV Asset Management, in control of $35 billion.

LSV (which stands for its founders, Lakonishok, Shleifer and Vishny) was started by Andrei Shleifer and his fellow "behavioral economist," University of Chicago Professor Robert Vishny, in 1994, simultaneously with Bracebridge, at the height of the Summers/Shleifer Russia looting scheme.

Andrei Shleifer and Robert Vishny have collaborated since at least 1986, writing articles together for NBER all through the Russia adventure and its collapse, including the audaciously titled paper, "Corruption" — written in 1993 when Vishny directed NBER's Corporate Finance Program.

Around 2005 or 2006, sometime before the global offshore finance bubble blew out, Andrei Shleifer sold his share of LVS, netting him perhaps around $400 million.

With his sponsor/protector Summers controlling White House economic policy, Professor Shleifer still operates in Russia. Shleifer operates out of his home on Bracebridge Road; or from his villa on the coast of France; or out of the University of Chicago Booth School of Business, the Summers clique's power center, the fabled home of the "Chicago Boys" whose policies were imposed by the death squads in South America.