Let’s talk about Hillary Clinton and the Historical Record

On March 10th, after eight days of anticipation, media and political uproar, the world fell privy to Hillary Clinton “breaking her silence” (aside from the stray tweet beforehand) regarding her decision to conduct government business from her personal clintonmail.com email address while Secretary of State - for ‘convenience’ purposes.

There are basically two opinion camps that have formed around email-gate. They break down, as these things too often do, across partisan lines. The GOP camp professes, absent any self-reflection of say, the 22 million lost-then-found emails deleted from a non-government domain during the George W. Bush administration, that this is another example of the Clintonian belief that laws and words are mere obstacles subject to manipulation.

The second, largely progressive Democrat camp believes that Hillary Clinton is being harpooned unfairly over this oh-so-minor issue in the scheme of matters of much greater gravitas. Hey, what is ‘is’ anyway? And what’s wrong with convenience – after all, two phones are so heavy and cumbersome?

But the historical record has an opinion, too. The capture of history is predicated on the preservation of information, preferably as much information as possible. Regarding American Presidential records, sometimes that information remains classified for “national security” or other reasons, or only released after decades of dormancy once said threat is deemed gone.

Other times, it will be made available to the public once it has been processed by archivists, neatly divided into folders and boxes and marked under official category names and numbers. It is then either accessed quickly (as the Oprah interview was at the Clinton library) or awaits years to be requested by a wayward historian. (This was the case for many of the items I was fortunate to unearth through my own recent presidential records analysis.)

When I was probing presidential archives throughout the country for All the Presidents' Bankers, classified, and then unclassified, information included items like former Chase head, David Rockefeller and Henry Kissinger’s melding of private banking and state department activities leading to the Iran Hostage Crisis during the Carter administration. Still classified information included pages of redactions in the George H W Bush archives regarding his son, Neil Bush’s role in the late 1980s Silverado S&L scandal. 

But even though I focused on the relationships and related policy decisions of presidents with key bankers, history pushed every Secretary of State associated with the 19 presidents I investigated to the surface as well. Their actions happened to intersect with those of the presidents and bankers; domestic and foreign policies thereby intertwined throughout the years in a detectable, and often repetitive, pattern. If those Secretaries of State had taken it upon themselves to divvy up and classify their own correspondence trails, the truth behind their actions, associations, and motivations would have been similarly diffused.

For the most part, before the advent of emails, presidential documents resided in the form of typed letters, handwritten notes, telegrams, and taped recordings (until after Nixon’s presidency). From Teddy Roosevelt through Ronald Reagan, the documents I examined were pre-email technology, as were the George HW Bush documents I was able to view.

As I reached the William J. Clinton Library in Little Rock, Arkansas, on a blustery mid-January day in 2013, fewer documents of any kind were available for my requested inspection compared to the prior presidential archives I had visited. First, because they had not been processed yet. Fewer historians and researchers are requesting information and fewer staffers work at these libraries (the money is made at the museum part of the libraries from busloads of tourists, not from those of us digging through the archives.) Second, the advent of emails and the masses of extra correspondence they produce, means that more procedures and protocol are harnessed to determine what can be released to the public, or whether these Automated Records Management System (ARMS) emails, as they are called, will remain hidden under the cloak of  ‘national security.’

The FOIA requests on bankers that I submitted to the Reagan Library for as yet uncategorized, but not classified information were processed within a few months. I have yet to hear back from the FOIA’s on bankers that I submitted to the Clinton Library in January 2013.

By using external email addresses and servers, Hillary Clinton didn’t just rob the records process of its ability to evaluate and categorize information; she robbed the public and even future public servants of the chance to examine her communications for analysis or relevant decision-making. Hillary Clinton chose to self-segregate her correspondence. She asserted she was not violating any rules or seeking to hide her communications in the process. Yet, rules were violated whether she sought to hide anything or not.

Before reporters at the UN, Clinton admitted that, "Looking back, it would've been better if I had simply used a second email account and carried a second phone but at the time this didn't seem like an issue…The vast majority (italics mine) of my work emails went to government employees at their government addresses which meant they were captured and preserved immediately on the system at the State Department."

She took “unprecedented steps” to make “all work-related emails public."  Yet, these steps weren’t hers to take.

According to White House Press Secretary Josh Earnest, President Obama had corresponded with Clinton via her private email address, “But”, Earnest said, “the president was not aware of the fact that this was a personal email server and that this was the email address that she was using exclusively for all her business."

It’s hard to imagine President Obama wasn’t aware that 'clintonmail.com' didn’t look like 'state.gov.' But if he had not been too busy to notice such minor discrepancies, he might have wondered whether or not she was using this email address for all of her business, government or otherwise. At some point, during her years working for him, he might have asked her to come on over to the state.gov side. But, he didn’t. Perhaps it served neither of them to have done so.

Yet, the Presidential Records Act of 1978, that President Obama himself amended, as did President George W. Bush, to give the White House more latitude in determining security issues for disclosures, is very clear in its definitions regarding what consitutes necessary information.

First, consider that on the White House’s website, under Executive Branch, it states:

“The power of the Executive Branch is vested in the President of the United States, who also acts as head of state and Commander-in-Chief of the armed forces. The President is responsible for implementing and enforcing the laws written by Congress and, to that end, appoints the heads of the federal agencies, including the Cabinet.” (Bold is mine.)

Then, under the heading Department of State, we see confirmation that:

“The Secretary of State serves as the President's top foreign policy adviser.”

Now, reading the definition of “Presidential Records”, from the National Archives website as per the Presidential Records Act of 1978 (44 U.S.C. Chapter 22), we see that:

"Presidential records" means documentary materials…created or received by the President, the President’s immediate staff, or a unit or individual of the Executive Office of the President whose function is to advise or assist the President, in the course of conducting activities which relate to or have an effect upon the carrying out of the constitutional, statutory, or other official or ceremonial duties of the President. “

True, these documentary materials don’t include “personal records” (such as yoga classes or wedding plans) or those “of a purely private or nonpublic character which do not relate to or have an effect upon the carrying out of the constitutional, statutory, or other official or ceremonial duties of the President.“

But equally, records are only considered "personal" if they are “not prepared or utilized for, or circulated or communicated in the course of, transacting Government business.” 

This was clearly not the case with Hillary Clinton's emails that did just that. The act also does not exclude government business conducted on a personal email, regardless of whether associated emails were incoming to, or outgoing from the President and captured in that manner. Therefore, conducting any government business on a personal email is a technical violation of the act.

According to Hillary Clinton, all government business related emails have been reverted to the State Department. Whether that is true or not is a conclusion she has robbed history of the ability to make. In other words, she didn't just exercise shady judgment for the sake of convenience, she disrespected American history and its rules for preserving information on behalf of journalists, academics, historians and the American and global public. 

The 2015 Financial Meltdown & More

This week, I had the pleasure of being interviewed by Greg Hunter at USA Watchdog regarding my thoughts on the state of the global markets, economies and commodities into 2015.  Here are some key points we covered. For more detail, please check out the video of our interview here.

1) On the Market Meltdown: When I spoke with Greg about 9 months ago, I said that based on logic and the political-economic history I had explored for All the Presidents’ Bankers, there should have already been another major implosion following the 2008 financial crisis. However, there is an element of history that is unprecedented and which has acted as a barrier, albeit tenuous and fabricated, to another full-blown, transparent crisis. The scope of the zero-interest-rate policy and QE programs that emanated from the US Federal Reserve and have unfolded throughout the world are artificially bolstering market and financial interests as populations falter. In the US, this has been greeted by proclamations of economic victory from the Obama administration. In Europe, it’s harder to tweak the employment stats enough to declare the same thing, and hence, official QE programs there are ongoing. At any rate, this prolonged policy of injecting cheap money into the banks and markets, funded by the public due to the very nature of debt-creation and the purchasing of government and asset-backed debt securities, now surpasses any past measures of such activities in terms of scope and length.

The fact that these policies lasted for six years has inflated and distorted bond and stock markets, as well as the books of the world’s largest financial institutions to such an extent, that inherent ‘value’ in any of these areas is impossible to determine. We are living with the instability of a system that is supported by central bank maneuvers and the leveraging of them, not by anything organic or independently sustainable. Because rates are so low, any establishment with access to this cheap capital, or that has other people's money to burn, is creating bubbles by reaching for returns anywhere - in government bonds, stock markets, leveraged loans in debt-intensive firms like oil and gas, and in complex derivative products consisting of currency, commodity and credit elements.

The idea of funding the entire financial system with no exit plan for any non-crisis producing dissolution or resolution for such support boggles the mind.  This global QE period is larger and more insane that ever in history.  Because SO much cheap money is sloshing around the system at its top echelons, not through the real economy, the false appearance of stability has been perpetuated longer than logic would dictate.  But since global QE is not yet over, its benefits will continue to accrue to the same institutions that are already benefitting from it (the ones that leverage capital or sell bonds) until all the QE plans are over - not tapered, but unwound and done. While this transpires, a meltdown will unfold, but slowly. Meanwhile, this next phase of ECB QE will provide markets and banks more temporary solvency. So will the Bank of Japan’s money supply expansion and the People’s Bank of China version. 

2) On Volatility:  Market and economic volatility will increase this year – punctuated with media headlines like ‘unexpected’.  Last year, we had volatility spikes in August, October and December.  This year, we’ve already had spikes in January.  So, the shocks are coming in more closely and the downsides are deeper.  That’s why we are in a transitioning down period.  At the end of this year, we will have a lower bond and stock market.  The financial system will start to unravel more visibly and in a more sustained manner. The Federal Reserve won’t raise rates (or if they do, it will be at the end of the year, and only once, as it will have a brutal impact) because there is no reason to. Real inflation of people’s costs of living might be higher, but with global QE keeping a lid on rates and a boost on bonds, and with the dollar still strong, Janet Yellen will just continue using terms like ‘patiently.’ Every time major market participants get remotely nervous, the market will dump, and the next FOMC meeting’s language will be conciliatory to assuage the nerves of this flawed system.

3) On the US Dollar: The reason the dollar has remained strong, and the reason it will continue to stay strong for now is not because the ZIRP and QE policies are good, not because so much debt on the books of the country is prudent, and not because our debt to GDP ratio is cost-effective.  Printing cheap money to sustain a system for six years is a negligent policy.  Using money to plaster over a banking system that doesn’t work and has only become more concentrated is not a stability-increasing policy.  Nor has any of this cheap money trickled down to the average person. All those things are horrific.  But, what the dollar has going for it is the unique collaboration and power-position of the US government, private banks and the Fed.  The US had a first mover advantage compared to the rest of the world.  Its QE policies were biggest.  The dollar is propped up artificially by these alliances and ongoing maneuvers. Every other country is doing so badly and will continue to, that the dollar has, and will have, a relatively better value for now.  Eventually, this madness has to play out and the dollar will weaken, but we won’t see a “plunge” in the near term because every other country is struggling. Any downside to the dollar will thus be part of a slower meltdown punctuated by extra volatility.

4) On Gold: The same reason the dollar has stayed strong is why gold hasn’t had a major outbreak to the upside. With so much artificial stimulus and systemic manipulation, the paper-dollar and hard-asset gold are behaving in a zero-sum game relationship where real value or economic measures are meaningless. That said, gold prices will increase this year– but also only gradually, just as the dollar will not dump but will decrease gradually, as all of these QE maneuvers continue to play out.  Again, the stock and bond markets will decline as this artificial aid eventually does, and the movements will be marked by volatility to the downside. But since the artificial aid isn’t actually over, the price direction of everything will remained tempered. We have been underestimating the effect of all the support that has been lavished on the markets and into the banks.  That’s why considering the timing of this next phase is critical. There’s going to be a downward impact on markets.  There’s going to be an upward impact on gold.  It’s just not going to be as huge this year.  It’s going to be a more gradual kind of a year.

5) On the Swiss Central Bank Float Move: The Swiss deciding to detach from pegging to the Euro must be looked at from two perspectives that together characterize the kind of volatility and stab in the dark policies in operation this year. On the one hand, the Swiss rejected the idea of increasing gold reserves last year (indicating, among other things, hesitancy and uncertainty in general,) and the SCB has imposed negative interest rates (as has the ECB.) Both of these move are related to global QE. On the other hand, the Swiss don't want to be pegged to a declining Euro that will result from the next round of more ECB bond buying to be announced by Mario Draghi on January 22nd.  In general, these central banks don’t really know what will happen in the short or long term as these QE and bank-supportive policies play out.  The Swiss can opt out of part of these measures, but have no choice on the rest.  To a large extent, their move was a way to balance both sides.

6) On Ongoing Bank Risk and Concentration: The largest 30 global banks (dubbed “GSIB’s” or globally systemically important banks) control 40 percent of lending and 52 percent of assets worldwide. In the US, since the financial crisis, the Big Six banks’ share of assets has increased by 41.4 percent and their share of deposits has increased by 82.4 percent. Because of the largesse of government and Fed policy, that gets spun as economically beneficial to the American population. The Big Six stockpile of cash meanwhile, which is doing nothing for the public, has nearly quadrupled in size. 

In addition, just 10 US banks hold 97 percent of all bank-trading assets. Of those, JPM Chase holds 43.8 percent and Citigroup holds 24.5 percent.  Then, there’s leveraged loans, the 2010s equivalent of subprime loans. The 2014 issuance of collateralized loan obligations, or CLOs, eclipsed that of pre-crisis 2006, run by the same cadre of big banks. In November 2014, regulators found that 1/3 of the $767 billion loans they examined in their annual bank loan review showed “lax reviews of potential borrowers and poor risk management.” Nothing was done about it. Oil and gas loans ($250 billion of them) remain primed for defaults and catalyzing more volatility. Adding to the risk, the top four US derivatives trading banks (JPM Chase, Citigroup, Goldman Sachs and Bank of America) hold $219 trillion of $237 trillion, or 93 percent, of US derivatives. 

That kind of consolidation, nationally and globally is why we’ve had six years of artificially stimulated markets. Those figures are why the benefits of these policies go to the most powerful players but not to anyone else. They are why instability is here to stay and grow.

My Holiday Book Recommendations, December 2014.

Here are some of my picks for 2014's thought-provoking books from a political, financial, economic and environmental standpoint. They are available at Indiebound, Amazon, and Barnes and Noble. I’m sure you all have great additions of your own. Enjoy and happy reading!

1) The Death of Money: The Coming Collapse of the International Monetary System by James Rickards, Portfolio Hardcover; 1st edition (April, 2014)

In clear, accessible prose, Jim Rickards dissects the precarious state of money at the hands of the world’s governments, multinational institutions, and central banks.  He reveals the extent of damage prevailing polices have already done to the global economy, what will happen if we continue on this path, and what ordinary citizens and small investors can do to protect themselves from the economic onslaught.

2) Unstoppable: The Emerging Left-Right Alliance to Dismantle the Corporate State by Ralph Nader Nation Books; First Edition (April, 2014)                  

Unstoppable is even-handed, erudite, practical and necessary. Ralph Nader harnesses his lifelong crusade on behalf of the public interest over the corporatist agenda into a treatise that is optimistic and patriotic. He shows that effective Left-Right political alliances aren’t pipe dreams, but historic realities in need of strategic cultivation, for the sake of all of our futures.

3) The Fight for the Four Freedoms: What Made FDR and the Greatest Generation Truly Great by Harvey J. Kaye (Simon & Schuster; First Edition (April, 2014))

In The Fight for the Four Freedoms, professor, historian and patriot, Harvey J. Kaye pens an inspiring account of a critical time in American history, inspired by the FDR’s premise that: “Freedom from want and from fear; Freedom of speech and religion” were crucial principals for all Americans. Comparing the strides that FDR made for the country with the anti-visionary maneuvers of more recent presidents Kaye shows that the way out and upward for the population lays in our past.

4) How America was Lost: From 9/11 to the Police/Warfare State by Paul Craig Roberts (Clarity Press (March, 2014))

In How America Was Lost, Paul Craig Roberts focuses his keen eye and sharp mind on the deterioration of government accountability and morality amidst the rise of hypocrisy and recklessness in the wake of 9/11. Through the tangle of wars, aggression, decimation of privacy, Wall Street protectionism and debt creation since, Roberts is relentless in his well-reasoned criticisms of US leadership from an economic and military standpoint.

5) Bad Paper: Chasing Debt from Wall Street to the Underworld by Jake Halpern (Farrar, Straus and Giroux (October, 2014))

Check out my CSPAN BookTV Interview with Jake:

In colorful prose and through the real life stories about an eclectic collection of characters ranging from felonious thug perpetrators to US veteran victims, Bad Paper exposes the murky world of consumer debt collection. From shiny Wall Street offices through the courtrooms of Georgia to the gritty pit of Buffalo, New York., Jake Halpern traces the movements of a “package” of debt from coast to coast, and reveals the human ramifications of criminal collection practices along the way.

6) The Divide: American Injustice in the Age of the Wealth Gap by Matt Taibbi (Author) Molly Crabapple (illustrator) (Spiegel & Grau; First Edition (April, 2014))

Matt Taibbi once again combines punching prose, on-the-ground reporting, and a sharp cynical eye for the absurd.In The Divide, he examines the two worlds that define our times – the one of the privileged elite that can dodge legal ramifications for mega-crimes, and the other citizens on the losing side of the economic and legislative system that are most impacted by financial wrongdoings yet liable to be arrested for not being wealthy enough to commit really large crimes,

7) Too Big to Jail: How Prosecutors Compromise with Corporations by Brandon L. Garrett (Belknap Press (November, 2014))

Garrett has compiled the most extensive database of corporate settlement information available today to shine a light not only on the manner in which corporations skirt the law, but also on what must be done to curb them. Too Big to Jail is a cogent, exhaustively researched plea for more equitable legal oversight. Here is the rest of my review in the National Memo.

8) Unveiled Threat: A Personal Experience of Fundamentalist Islam and the Roots of Terrorism by Janet Tavakoli  (Lyons McNamara LLC (November, 2014))

Janet Tavakoli, primarily known for works on Credit Derivatives and for her thriller about finance and the Vatican, shows her versatility as a writer and thinker in Unveiled Threat. Drawn from her personal experiences during Iran's Islamic revolution of 1978-79 and a plethora of research collected since, Tavakoli reveals the extent to which Fundamentalist Islam is at odds with basic freedoms and rights.

9) Carbon Shock: A Tale of Risk and Calculus on the Front Lines of the Disrupted Global Economy by Mark Schapiro (Chelsea Green Publishing (August, 2014))

In Carbon Shock, Mark Schapiro transcends standard discussions about the culprits and ramifications of climate change and takes us on a harrowing, international exploration of the economic costs of carbon emissions. He exposes the multinational corporate obfuscation of these costs and outlines his long-term solutions.

10) This Changes Everything: Capitalism vs. the Climate by Naomi Klein  (Simon & Schuster (September, 2014)

In This Changes Everything, Naomi Klein examines climate change in the context of rapacious capitalism accelerating its destruction of the planet, enhancing inequality and pulverizing economies. She evenly examines climate-change by detailing its deniers and overzealous activists, concluding  that the market isn't going to stop the crisis that must be stopped nonetheless for all of our sakes. Klein details the efforts of those doing something about it leaving us with hope.

11) The 2001 Anthrax Deception:  The Case for a Domestic Conspiracy by Professor Graeme MacQueen.

Graeme MacQueen’s well-researched book analyzes the October 2001 Anthrax attacks. He examines how the media and Bush administration spin about the threat of bio-terror was used to pass the Patriot Act and to establish a connection between Saddam Hussein and 9/11. Whatever one’s thinks about 9/11; he provokes the question of whether the attacks were created or leveraged to rally Iraq War support.

12) Social Insecurity: 401(k)’s and the Retirement Crisis by James W. Russell (Beacon Press, April, 2014)

James Russell’s book, Social Insecurity, will enrage citizens of all ages and political persuasions, illuminate them about the pillaging of their economic futures by the financial industry, and incite them to action. More than a description of a retirement system coopted by predatory bankers and fund managers, Social Insecurity is also a passionate account of the complicity of the global political elite and a plan of change.

13) In the Shadow of Saint Death: The Gulf Cartel and the Price of America's Drug War in Mexico by Michael Deibert (Lyons Press, June 2014)

Michael Deibert is one of those rare journalists that plunges himself into the most bloody and tumultous conflicts in the world, having written two prior books on his experiences in Haiti and the Congo. His latest book, In the Shaodw of Saint Death, takes him to the bowels of the Mexican drug wars, from which he chronicles the devastating consequences of cartel battles and the impact of US drug policy. An eye-opening, harrowing read.