Pam Martens

What President Obama Didn’t Address: Who’s Funding the Hate Campaign Against Muslims?

Last evening, in his speech to the nation from the Oval Office, President Obama reminded Americans that “Muslim Americans are our friends and our neighbors, our co-workers, our sports heroes — and, yes, they are our men and women in uniform who are willing to die in defense of our country.”  In his concluding remarks, the President told viewers that our nation was “founded upon a belief in human dignity — that no matter who you are, or where you come from, or what you look like, or what religion you practice, you are equal in the eyes of God and equal in the eyes of the law.” (See full video of the speech below.)

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NYU’s Gilded Age: Students Struggle With Debt While Vacation Homes Are Lavished on the University’s Elite

A review of deeds and mortgages in some of the toniest towns on the East Coast reveals that not only is New York University financing luxury Manhattan brownstones and high rise condos for its faculty and administrators out of its nonprofit coffers, it has also been secretly financing country homes for a select group. These extravagances have fallen directly on the shoulders of financially struggling students. NYU ranks fourth in Newsweek’s 2012 list of the least affordable colleges.  

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Bombshell: Senator Sherrod Brown Questions Obama Nominee on Too-Big-to-Jail Banks

Americans learned for the first time on March 6 of this year that the highest law enforcement agent in our country, Attorney General Eric Holder, weighs economic interests when deciding whether to enforce our Nation’s laws against criminal wrongdoers like the too-big-to-fail banks.

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The NRA Turns 300 Tax-Funded Wildlife Refuges Into Killing Fields

A public relations nightmare is engulfing the Arthur R. Marshall Loxahatchee National Wildlife Refuge in Boynton Beach, Florida over a plan to become the first taxpayer funded national wildlife refuge in the country to allow the killing of alligators as an officially sanctioned form of recreation. What the general public doesn’t know is that killing as a form of public recreation is already sanctioned at over 300 out of a total of 556 national refuges across the country that are funded with the public purse. The killing includes some of the most beautiful species cherished by wildlife observers: Blue and Green Wing Teal, Wood Ducks, Hooded Merganzers, Bobcats and Mountain Lions as well as dozens of other species.

Since October of last year, management of the Loxahatchee Refuge, the last remnant of the northern Everglades, has come under withering public criticism for failing to comprehend the meaning of the word “refuge.” An in-depth search of congressional records, however, lays the blame at the feet of the gun-rights lobbying machine, the National Rifle Association (NRA), currently in the storm of public outrage over the Sandy Hook Elementary School shootings and the assault weapon used in the killing of children. The NRA says it “played a key role in getting language included in the National Wildlife Refuge System Improvement Act of 1997, making hunting a ‘public priority use’ on refuges.” In September of last year, an additional 17 refuges added or expanded hunting and the NRA brags it was because it “championed and helped draft” the language in the 1997 legislation.

The language of the legislation is Orwellian. There are 15 separate references to the phrase “wildlife-dependent recreation.” Here’s an example: “Provide increased opportunities for families to experience compatible wildlife-dependent recreation, particularly opportunities for parents and their children to safely engage in traditional outdoor activities, such as fishing and hunting.”

President Bill Clinton, who astutely understands the political power of the NRA, signed the 1997 bill into law. Clinton had learned the power of the NRA in 1994. After signing legislation in September of 1994 that banned assault weapons for 10 years, Clinton watched a Republication sweep of both houses of Congress in the November midterms that year, ending 40 years of Democratic dominance. In just the last ten years, the NRA has poured $22 million into lobbying Congress. In just the 2011-2012 election cycle, the NRA pumped $24.6 million of soft money into elections according to the Federal Election Commission and Center for Responsive Politics. The NRA Foundation has given tens of millions more in grants to hunting clubs, 4H groups, and Boy Scout troops according to a review of their publicly accessible Form 990 tax filings.

Clinton, wittingly or unwittingly, had sealed the fate of wildlife protection on national Refuges when he signed Executive Order 12996 the year before the legislation was placed on his desk. The 1997 legislation itself describes what happened: “On March 25, 1996, the President issued Executive Order 12996, which recognized ‘compatible wildlife-dependent recreational uses involving hunting, fishing, wildlife observation and photography, and environmental education and interpretation as priority public uses of the Refuge System.’ Executive Order 12996 is a positive step and serves as the foundation for the permanent statutory changes made by this Act.”

With the sweep of a pen, the President of the United States turned killing of wildlife on taxpayer-funded land into a priority recreational objective and placed it on a level plane with wildlife photography.

According to documents obtained under sunshine laws from the Loxahatchee Refuge, it has received written comments from 3,409 individuals over its “recreational” plan to allow the killing of alligators by hunters. The comments came from around the world, with 69 foreign countries represented. A total of 3,345 individuals stridently opposed the plan while 64 individuals supported the plan, consisting predominantly of hunters and hunting groups. All of the major newspapers in South Florida have carried the story, with Frank Cerabino of the Palm Beach Post asking in his column: “How is killing wildlife for sport in a wildlife refuge acceptable? It’s not like you allow a small number of violent ex-husbands into battered women’s shelters to beat up a sustainable quota of the women there...”

One of the written comments sounded a similar theme: Erik of Toronto wrote: Sounds like an oxymoron. In a wildlife refuge. Be like shooting seniors in a retirement home.”

The letters were revealing, taking the pulse of the public mood toward special interests, money and power trumping the will of the majority. A science teacher named David wrote: “I’m assuming that hunters are putting the squeeze on you to open Lox to this terrible idea.” A doctor named Steven from Davie, Florida said the proposal “smells of outside influence to high heaven,” adding “I doubt this message or any similar public comment will have an influence on the decision. I am well aware that the public comments you allow are simply required protocol that once fulfilled, is completely ignored.”

The view that the request for public comment was a form of political charade proved to be prophetic: the plan was officially approved by the local U.S. Fish and Wildlife Service that runs the Refuge on January 17, 2013, less than three months from the date on the comment letters which were 98 percent opposed to the plan.

Scientists and experts wrote against the plan: a Natural Resource Specialist in the U.S. Army Corps of Engineers; a member of a steering committee of the American Zoological Association; a Senior Environmental Scientist from a neighboring county; a man involved in alligator rescue. The scientists made the point that there are ample alligator hunting opportunities outside the refuge and no legitimate rationale to bring the hunt inside.

The Refuge’s own documents bear the scientists out. The approved hunt plan indicates that hunting of alligators began in 2007 on the land that adjoins the Refuge – Storm Water Treatment Area 1 West, under the supervision of the state agency, the Florida Fish and Wildlife Conservation Commission. According to the document, a total of 1019 alligators have been killed there during the period 2007 through 2011. No figures were yet available for 2012.

The alligators of Storm Water Treatment Area 1W are likely alligators from the Refuge. The report concedes: “Due to the proximity to the Refuge and lack of nesting within the STA-1W, it is likely that the majority of the alligators in STA-1W migrated from the Refuge.”

Given that there is already hunting on land next door, why put the thousands of children and birdwatchers who visit the Refuge at risk of a hunting accident and destroy the goodwill the Refuge needs for its volunteer and donor programs? It was that topic that drew the most scorching invective.

Karen of Fort Lauderdale wrote: “The very prospect of being subjected to the sight of these amazing and powerful creatures slaughtered would be reason enough for me to no longer come or bring my children and visiting friends to the refuge.”

Jeff from a produce business wrote: “I could not in good parenting bring my family there if this goes forward.”

Marc, owner of a family business in Fort Lauderdale wrote: “We bring our children there and our Scout Troop; what’s wrong with you people????”

Belinda of Toronto was concerned about the age of the hunters and the use of bang sticks (a firearm on a pole) that is one of the approved weapons. She said the use of bang sticks was “cavalier,” given that the Refuge planned to allow hunters under the age of 16 to participate, provided they are accompanied by an adult aged 21 or older. “All of this places both the users of these firearms, and the public, at greater risk. This is unacceptable,” she wrote.

Under the final plan outlined in the documents and signed off on by Refuge personnel, the hunting will be done at night (from one hour before sunset to one hour after sunrise) on Friday and Saturday nights from August 15 through November 1, beginning this year. In addition to bang sticks, other approved weapons include crossbow, snares, gigs, and spear guns. Motor boats will also be allowed. All in the dark.

Ana Campos, a local activist, led a petition drive to overturn the plan and set up a web page pleading to save George, the 12-foot alligator at Loxahatchee who has become an icon of the Refuge. Campos also wrote to the Refuge management, saying she was “deeply concerned over safety issues,” adding that the Refuge “is filled with children from Girl Scouts and Boy Scouts to field trips and families…Bullets do not discriminate and all it takes is one hunting accident to destroy a life and a family.”

Campos is right. In just the last two years, three males, an 18-year old, 32-year old and 63-year old were shot to death in hunting accidents on National Wildlife Refuges. Many more serious, non-fatal accidents have occurred.

CBS and the Associated Press reported a November 6, 2010 hunting accident near the Big Stone National Wildlife Refuge in Odessa, Minnesota where a father’s 12-gauge shotgun accidentally went off and tore a hole through the back of his 16-year old son, “before passing through his ribs, lung, diaphragm and liver.” The son survived but spent a month in the hospital recovering.

In addition to the written comments, a public hearing was held on the proposed alligator hunt on September 20, 2012 at the Vista Center in West Palm Beach, Florida. Rosa Durando, Conservation Chair of the Audubon Society of the Everglades, who cares for homeless or unwanted farm animals at her farm not far from the Refuge, said “I have a big pond on my property…It’s not overrun with alligators, which would indicate to me there isn’t a surplus.” One statistical table in the approved Refuge Hunt Plan shows one of the main canals at the Refuge,L-39, going from an alligator population of 1,432 in 1981 to 134 in 2012. The other main canal, L-40, went from 546 alligators in 1981 to 147 in 2012. Why kill a shrinking population at the Refuge?

The management of the Loxahatchee Refuge concedes in its written responses to critics that the intent is not to reduce the population of alligators but to create “enjoyable recreation experiences.”

Don Anthony, Communications Director for the Animal Rights Foundation of Florida, testified at the hearing, asking “Why would you suddenly want to inflict guns, bullets and violence into this calm natural place?” In reality, with very little public awareness, 30,000 acres of the 144,000 acre Loxahatchee Refuge annually hosts hunters to kill beautiful ducks and coots. It’s called a “harvest,” the new preferred term by the NRA.

Anthony minced no words on the issue of “harvesting” living creatures. “By the way,” said Anthony, “the euphemisms alligator management or harvesting, it’s an alligator slaughter program. Alligators are violently hunted with spears and harpoons, and then the wildly thrashing animal is supposedly to be cleanly shot with a bang stick. What are the odds of that happening to a thrashing animal? Frequently they get loose. They suffer for hours or days before dying.”

Matthew Schwartz, Executive Director of the South Florida Wildlands Association, testified at the hearing and also mailed a detailed written statement. Schwartz said Florida has a resident population of 19 million and had an additional 87 million visitors in 2011 while there are only 145,000 licenses issued to resident hunters and another 7,500 to non-residents.

A recurring theme from hunters is that they are the ones who pay to support the Refuges through the purchase of Duck Stamps – a pictorial stamp produced by the U.S. Fish and Wildlife Service that serves as a license for hunting migratory waterfowl – and their money entitles them to hunt on national Refuges.

Newton Cook, speaking on behalf of the United Waterfowlers, a duck hunting organization, said at the public hearing: “…waterfowlers have been buying Federal Duck Stamps for over 70 years and the money is what pays for these refuges to a large degree.” In fact, it’s the non-hunting taxpayer who has paid for the bulk of the refuges. According to the U.S. Fish and Wildlife Service, since 1934, sales of Federal Duck Stamps to hunters, collectors and conservationists have raised more than $700 million to acquire 5.2 million acres of habitat for the National Wildlife Refuge system. That’s just 3.5 percent of the total 150 million acres that make up Refuges.

According to the 2011 National Survey of Fishing, Hunting, and Wildlife-Associated Recreation, there were 13.7 million people, aged 16 and older, who hunted in 2011; that’s just 4.3 percent of the U.S. population. The same survey showed 71.8 million people engaged in wildlife watching or 23 percent of the total population.

People for the Ethical Treatment of Animals (PETA) issued the following statement by Kristin Simon, a Senior Cruelty Caseworker: “These are stunning creatures who want only to be left alone to swim, roll in the grass, hunt for food, and bask on sunny banks, and they deserve to live free of human torment. PETA urges the National Wildlife Refuge System to ban cruel and unnecessary initiatives that breed insensitivity toward animal life, disturb populations, and damage ecosystems. Officials would be better to promote environmentally sound activities like wildlife photography, bird watching, hiking, kayaking, camping, and canoeing. Wildlife refuges should be just that — refuges for wildlife.”

Gandhi said “The greatness of a nation and its moral progress can be judged by the way its animals are treated.” The trajectory of our Nation’s moral progress is coming into clearer focus. The highest authority on law in our land, the U.S. Supreme Court, two years ago gave citizenship status to corporations to make certain they have an untrammeled voice in our elections in the Citizens United v. Federal Election Commission decision. Today, some of the most beautiful living species, with a heart and a brain and the ability to feel pain and suffer -- attributes corporations do not possess -- have been reduced by lobbyists to a field of corn to be harvested.
Our very language is being rewritten by corporations through the legislative process: refuge and recreation and harvest now mean killing field.

Some of the highest moral authorities for children in the Catholic Church, who have bestowed on each other names like Bishop and Cardinal, are proven to have stripped those children of their childhood and dignity and trust of fellow humans by covering up for decades the sex abuse by priests upon this innocent and vulnerable population; wantonly shipping the abusers off to other parishes to continue to destroy the lives of more children.

Wall Street executives who caused the greatest economic collapse since the Great Depression go unpunished while hungry people committing minor crimes are sent to jail.

Our Nation is at a pivotal crossroad. We can go the way of the Roman Empire or we can step out of our comfort zone and stand up for those without a voice. It starts right here, right now, with George the alligator. The final hunt plan must still be published in the Federal Register with a 30-day public comment period after that. To receive notice of when and where you can submit comments, email me at

The Federal Reserve, a Privately Owned Banking Cartel, Has Been Given Police Powers, with Glock 22s and Patrol Cars

By mid morning on Monday, September 17, as Occupy Wall Street protesters marched around the perimeter of the Federal Reserve Bank of New York, all signs that an FRPD (Federal Reserve Police Department) existed had disappeared.  The FRPD patrol cars and law enforcement officers had been replaced by NYPD patrol cars and officers.   That decision may have been made to keep from drawing attention to a mushrooming new domestic police force that most Americans do not know exists.

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How the Big Banks Are Trying to Destroy Our Justice System

The following is Part II of an investigative series on Citigroup and fraud. Part 1, which reveals that Citigroup may have defrauded Abu Dhabi of billions, can be read here.

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Did Citigroup Defraud Billions from U.S. Ally Abu Dhabi?

According to a confidential cable published by Wikileaks, the U.S. Embassy in Abu Dhabi sent a communication to the U.S. Secretary of State and U.S. Treasury on December 22, 2009, alerting them to the fact that the investment arm of a U.S. ally, Abu Dhabi, believed it had been defrauded of $4 billion by Citigroup (Wall Street’s serial miscreant and recent ward of the taxpayer).  The cable relayed that William Brown, legal advisor to the Abu Dhabi investment arm, unequivocally stated that Citi ‘lied’ and must be held accountable.” 

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Wall Street Firms Spy on Protesters in Tax-Funded Center

The following article is original to CounterPunch.

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Our Economy Is Going to Keep Tanking Until We Stop Shoveling Billions to Rich People

For the past eight months, we have been a nation focused on bailouts and bankruptcies. For the past ten years, we have been a nation ignoring massive wealth transfer and wealth concentration through a rigged Wall Street.

As simple and clear as this picture is, some of the brightest minds in this country are unwilling to connect the cause and effect of wealth in too few hands to bankruptcies and a tanking economy.

Wealth-deprived consumers can't buy the goods and services being produced. This leads to repetitive cycles of layoffs and growing unemployment which leads to more wealth-deprived consumers leading to more overcapacity in production plants, more layoffs, more shrinking purchasing power.

The accompanying, and equally dangerous, problem is that concentrated wealth stifles the very innovation that is necessary to create new industries, new jobs and lead us out of the downward economic spiral.

Let's think about the individuals who tapped into Wall Street's rigged wealth transfer system and what they have done with their ill-gotten loot: typically, they own three or more homes, fancy cars, multiple country club memberships, airplanes, yachts, and numbered offshore bank accounts. The problem is, they just can't buy enough to compensate for the purchases they have deprived hundreds of thousands of other consumers from being able to make.

Goods sit on shelves, new orders get cancelled, leading to production cuts, layoffs, plant closings and bankruptcies.

In a nutshell, it's the $1 Billion that Sandy Weill extracted from Citigroup as its former CEO and Chairman that's the problem; it's the $42 million condo he bought that's depriving 140 other people from having $300,000 to buy a home ready to go into foreclosure for want of a buyer. It's the hundreds of millions Weill is throwing around to plaster his name and his wife's name on buildings that could be in the hands of 10,000 consumers going out to buy Chrysler and GM cars now gathering dust on the lots of dealers about to go bust.

It's also that Sandy Weill and his colleagues of that era on Wall Street did not do anything worthy or smart in exchange for extracting that wealth from the system. They repealed the regulations that had kept the system on a more solid footing, then looted the system and left it a basket case. We have no residual benefits of innovation to compensate for all that missing wealth.

And that is the real and overlooked attendant danger: too many billionaires sitting atop too many billions tied up in mansions and yachts means that millions of budding innovators and entrepreneurs are being deprived of adequate funds to create the breakthroughs that will lead to new industries and future job growth.

And let's not forget about the trillions of dollars of wealth that evaporated in bogus ventures that Weill and his fellow Wall Streeters brought to market on NASDAQ. Add those trillions to the bailout trillions and you're looking at a lost generation of funds for innovation.

What all of this means is that President Obama has precious little time left to stop rewarding failure and bad behavior before his own Presidency is deemed a failure. It was difficult enough to countenance the reappearance in his administration of all those Wall Street faces who failed to rein in the Wall Street abuses or, worse, aided and abetted the actual creation of the opaque system that permitted the looting and pillaging. But this past week's news that the President might be considering a pivotal role for the Federal Reserve in the new regulatory structure planned for Wall Street crosses the line, if true, from hubris to outright contempt for the American people.

The inherent cronyism of the Federal Reserve renders it utterly useless as a watchdog. (Why is it even necessary to have to state that obvious fact when no one can shake loose from the Fed what it's done with trillions in taxpayer dollars or why it failed to police these Frankenbanks in the first place.) The same thing is true of the U.S. Treasury, which can't auction its own debt without the goodwill of its Wall Street primary dealers.

According to March 31, 2009 data from the Federal Deposit Insurance Corporation, there are 8,246 FDIC insured institutions with total assets of $13.5 Trillion and domestic deposits of $7.5 Trillion. Four institutions, Bank of America Corporation, JPMorgan Chase & Co., Wells Fargo & Co. and Citigroup Inc., four institutions out of 8,246, control 35% of all the insured domestic deposits and 46% of the assets according to the March 31, 2009 figures from the FDIC.

Has the Federal Reserve taken steps to reduce this massive concentration since the financial crisis began? Quite the contrary. Bank of America was allowed to purchase the investment bank and brokerage firm Merrill Lynch as well as subprime lender Countrywide Financial; JPMorgan Chase took over the investment bank and brokerage firm Bear Stearns as well as Washington Mutual; Wells Fargo & Co. took over Wachovia.

The Federal Reserve's answer to concentrated wealth is to concentrate it further. The Federal Reserve's answer to unmanageable, dysfunctional banking institutions is to make them more unmanageable and more dysfunctional.

President Obama needs to do three things quickly to get the country back on course: he needs to separate investment banking/brokerage from commercial banks. This will restore risk taking and innovation to where it belongs, in non FDIC insured institutions. He needs to put new faces that Americans can trust in charge of real regulators with real powers. He needs to stop funneling money to zombie institutions that haven't created anything of innovative value in a decade and channel those funds into innovative research and development projects.

President Obama needs to step up to the plate and stop listening to conflicted advisors. The fate of a nation, as well as his place in history, hangs in the balance.

How the Banksters Made a Complete Killing off the Bailout

In 1897, when 8-year old Virginia O'Hanlon posed her Santa Claus query to the New York Sun, she received a heart-warming editorial response reassuring her that "He exists as certainly as love and generosity and devotion exist."

Today, we hand our 8 year olds a $13 trillion national debt while our Congress hands Wall Street banksters the national purse without so much as a hearing to determine the cause of the debt collapse. Worse still, the money is doled out to the very same individuals who leveraged their institutions to casino status.

Americans are correctly outraged at the spectacle of U.S. crony capitalism crashing stock and bond markets around the globe while simultaneously watching the poster boys of crony capitalism on Monday, October 13, 2008 march up the granite steps of the United States Treasury building in their Armani shoes and heist a fresh $125 Billion of taxpayer dough in broad daylight.

The U.S. Treasury Secretary, Henry Paulson's, $700 billion bailout plan to buy up distressed mortgage assets has spun off its own $250 billion subsidiary plan (skipping that pesky detail called taxation with representation) to inject $125 billion in equity capital into 9 of the biggest commercial and investment banks in the country. Another $125 billion may possibly go to smaller regional banks and thrifts, assuming they will sign on to the deal.

And what will taxpayers get for their investment in these financial firms whose stock prices are getting hammered as the public recoils in revulsion at what they have done to our financial system? The taxpayers, who were not invited to send their own legal representative to the negotiating table, will receive a paltry 5% dividend, exactly half of what Warren Buffett received for his recent investment in General Electric, a company that actually makes something real, like jet engines and light bulbs.

Now we learn from the U.S. Treasury web site that it has hired the law firm of Simpson, Thacher & Bartlett to represent our taxpayer interests going forward at a cost to us of $300,000 for six months work. But we're not allowed to know their hourly wages; that information has been blacked out on the Treasury's contract. Curiously, the Treasury has named in its contract the specific lawyers it wants to work for us. Two of those are Lee A. Meyerson and David Eisenberg. Mr. Meyerson has been a central player in facilitating the bank consolidations that have led to the present train wreck, including building JPMorgan Chase from the body parts of Chemical Bank, Chase Manhattan and Bank One.

Mr. Eisenberg has played a central role in the proliferation of the credit derivatives blowing up on the books of the Frankenbanks created by Mr. Meyerson. Here's what the Simpson, Thacher & Bartlett web site says about its relationships and Mr. Eisenberg's work:

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How a Shady Citigroup Subsidiary Secretly Makes Billions in the Oil Market

If you want to flush out market manipulation, don't turn to the sleuths in Congress. They've been probing trading of the oil markets for two years and completely missed a company at the center of the action. During that period, a barrel of crude oil has risen from $50 to $140, leaving a wide swath of Americans facing a choice this coming winter of buying food or paying their heating bill.

The company that Congress overlooked should have been an easy suspect. It launched the oil trading career of the infamous fugitive Marc Rich, pardoned by President Bill Clinton in the final hours of his presidency. It was at one time the largest oil and metals trader in the world. In the late '90s it bought up 129 million ounces of silver for legendary investor Warren Buffet's company, Berkshire Hathaway, in London's unregulated over-the-counter market. In 1990, it was one of the first entrants into an ill-fated Russian oil venture called White Nights. In 2005, while part of Citigroup, the largest U.S. banking conglomerate perpetually scolded for obscene executive pay, it handed its chief and top oil trader, Andrew J. Hall, $125 million for one year's work. According to the Wall Street Journal, that was five times the pay package for Chuck Prince, CEO of the entire Citigroup conglomerate that year and $55 million more than the CEO of Exxon-Mobil.

Given this storied history and two years of congressional testimony on oil trading skulduggery, one would expect to find volumes of current information available about this oil trading juggernaut. Instead, this company's activities are so secret that its website,, is a one-page affair and lists only the addresses, phone and fax numbers of its offices in the United States, London, Geneva and Singapore. No officers' names, no bios, no history, no press releases. And while the Wall Street firms of Goldman Sachs and Morgan Stanley have been fingered by Congressman Bart Stupak, D-Mich., for gaming the system, Phibro has completely escaped scrutiny during a seven-year period when crude oil has risen an astonishing 697 percent.

Phibro is the old Philipp Brothers trading firm that has resided secretly and quietly on Nyala Farms Road in Westport, Conn., as a subsidiary of the banking/brokerage behemoth Citigroup since the merger of Traveler's Group and Citicorp (parent of Citibank) in 1998. Traveler's Group owned Phibro at the time of the merger. Despite the fact that Phibro has provided Citigroup with $2 billion in revenue over the past three years, the 205-page annual report for Citigroup in 2007 carries only the following one-sentence footnote on commodity income that acknowledges the existence of this company: "Primarily includes the results of Phibro Inc., which trades crude oil, refined oil products, natural gas, and other commodities."

Combing through government archives, the first noteworthy appearance of Phibro occurs on April 6, 2001, when the Wall Street law firm of Sullivan & Cromwell sent a letter to the Commodity Futures Trading Commission (CFTC), the federal regulator of oil and other commodity trading, acknowledging that it was representing "the Energy Group." The letter was noteworthy because it delineated just who had teamed up to grease the oil rigging in Washington: namely, two investment banks (Goldman Sachs and Morgan Stanley); a house of cards that would later collapse (Enron); a proprietary trading firm inside a Frankenbank (Phibro inside Citigroup); and two real energy firms (BP Amoco and Koch Industries).

What the Energy Group had long lobbied for and finally received from its federal regulator was the breathtaking ability to trade oil contracts and oil derivatives secretly in the over-the-counter (OTC) market, thus avoiding the scrutiny of regulated commodity exchanges, its CFTC regulator and Congress. The April 6, 2001, letter was essentially to say thanks and interpret the new rules as favorably as possible for the Energy Group.

The change in the law occurred via the Commodity Futures Modernization Act of 2000 (CFMA) and is called the Enron Loophole. (Since Enron's trading room went belly up along with the company, and Phibro is still trading oil secretly all over the world, it should perhaps now be called the Phibro Loophole.)

What the CFTC also granted the big Wall Street trading firms was a license to sneak under the radar by using computer terminals located in the United States while trading oil on foreign exchanges like the Intercontinental Exchange (ICE) located in London but owned by an Atlanta, Ga., outfit that was funded and launched by Wall Street firms and big oil.

On June 3 of this year, Dr. Mark Cooper, director of research for the Consumer Federation of America, correctly outlined the problem to the Senate Committee on Commerce, Science and Transportation:

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