Why Did the Fed Bail Out the Bank of Libya?

By Sen. Bernie Sanders, Reader Supported News

02 April 11

How Do Gadhafi's Bankers Avoid US Sanctions?

en. Bernie Sanders (I-Vt.) today questioned why the Federal Reserve provided more than $26 billion in credit to an Arab intermediary for the Central Bank of Libya.

The total includes at least $3.2 billion in loans that the Fed was forced to make public today in addition to earlier revelations under a Sanders provision in the Wall Street reform law.

Sanders also asked why the Libyan-owned bank and two of its branches in New York, NY, were exempted from sanctions that the United States this month slapped on other Libyan businesses to pressure Col. Moammar Gadhafi's government.

"It is incomprehensible to me that while creditworthy small businesses in Vermont and throughout the country could not receive affordable loans, the Federal Reserve was providing tens of billions of dollars in credit to a bank that is substantially owned by the Central Bank of Libya," Sanders said.

In a letter to Federal Reserve Chairman Ben Bernanke and others, Sanders asked why the central bank made at least 46 emergency, low-interest loans to the Arab Banking Corp., in which the Central Bank of Libya owns a 59 percent stake.

In the same letter, Sanders asked Treasury Secretary Timothy Geithner why the Treasury Department on March 4 let the Libya-controlled bank skirt the economic sanctions against Libya.

The senator also questioned why the Bahrain-based Arab Banking Corp. is even allowed to operate branches inside United States. "Why would the US government allow a bank that is predominantly owned by the Central Bank of Libya - an institution on which the US has imposed strict economic sanctions - to operate two banking branches within our own borders?" Sanders asked.

The Fed transactions were made public earlier this year as a result of a Sanders provision in the Wall Street reform law that forced the US central bank to reveal which financial institutions it bailed out during the financial crisis from 2007 to 2010.

In another dubious twist, the Fed loans, at interest rates as low as 0.25 percent, relied on US Treasury securities as collateral. In other words, at the same time that the Arab Banking Corp. was borrowing money at almost zero interest from one arm of the government, the Fed, it was lending money at a higher interest rate to another arm of the US government, the Treasury Department.

Geoffrey Dunn: "The Lies of Sarah Palin"

By Gloria Nieto, San Francisco Chronicle

29 March 11

have been friends with Geoffrey Dunn for well over two decades. He is an award winning journalist and film maker. He has given me this exclusive preview interview for his forthcoming book on Sarah Palin. His book, "The Lies of Sarah Palin: The Untold Story Behind Her Relentless Quest for Power," will be released in early May by St. Martin's Press.

Thank you for agreeing to this interview. Can you tell me a little about your new book?

When I first envisioned my book - in the fall and winter after the 2008 presidential campaign - I saw it being sort of a boutique political history of Alaska, focusing on Palin and the way in which Alaska politics are isolated from the larger American body politic and how that isolation played into Palin's favor in securing her nomination.

Remember, at that time, everyone assumed that Palin would go back to Alaska, serve out her term as governor, and probably run for re-election as governor in 2010. That was going to be the end of my book - Palin's re-election campaign for governor. At some point along the way I realized she wasn't going to run for re-election. I was receiving lots of signals from people close to her and in the Alaska legislature. She clearly hated being governor after she returned from the presidential campaign. When she quit, I wrote a piece about how this freed her to establish a national platform. And that's precisely what she did.

So my book changed substantially. It grew into a massive political biography that still examines the dynamic between Alaska and American politics, but which also exposes Palin's "pathology of deceit," as I call it, and the dysfunction that follows her wherever she goes - from her first days as mayor in Wasilla through the 2008 presidential campaign to her return as governor to her haphazard "run" for the GOP nomination in 2012.

You had to have some history in Alaska. Your posts on Huffington Post showed an in-depth knowledge of the state and the politics. Could you tell me about your history in Alaska?

I first visited Alaska in the summer of 1974 with my dad. We drove through Canada and up the Alaska Highway, eventually all the way through Anchorage to Homer. It was a stunning adventure, and great fishing. I even worked the "slime line." From that point on I studied Alaska politics, history, and literature. My family had been involved in the Alaska fishery since the 1920s and 1930s. So Alaska has always held a place in my imagination. I focused on Alaska politics and literature during my undergraduate studies. Since then, I've been up and down the inside passage several times. I love Southeast. When I was diagnosed with some serious cancer in 2005, I went to Alaska with my family to heal after extensive chemo and radiation treatments. In Ketchikan on that trip, where I had stayed 25 years earlier, I first heard about the Bridge to Nowhere. I got refocused on Alaska politics. With the internet, of course, which didn't exist when I first studied Alaska politics, you can follow several Alaska papers daily. It was almost like I was living there.

So Sarah Palin was not a new politician to you because of your history, is that correct?

GD I first heard about Palin in 2006 during her run for governor. I confess to being a fan of Tony Knowles, on a personal level, so I was pulling for his victory. And I also liked the moderate candidate Andrew Halcro. I also knew people in the Mat-Su who knew Palin during her term as Mayor in Wasilla, so I didn't buy any of the hype of her being a "fresh face." When she was named McCain's running mate in August of 2008, I made a single call to Irl Stambaugh - who was a friend of a friend - and whom Palin had fired as Police Chief when she became Mayor of Wasilla. I did an interview with him then and he told me her governance was based on "fear and retribution." I did that interview the day she was nominated and posted a day later. It took me a single phone call to vet her more thoroughly than the McCain campaign ever did before selecting her.

So you are saying you did a vet of Palin and the McCain campaign did not? Is that because the Republican powers that be, Bill Kristol, et al, were pulling some strings? I read about their first introduction to her when their conservative cruise ship landed up there and she invited them for halibut cheeks lunch and enchanted them.

I devote about about 90 pages in the book to the "vetting of Palin." So you'll have to read the full book when it comes out (wink). But McCain had been set on Lieberman as his running mate until the very end of August, and the evangelical wing of the Republican Party said 'no dice.' They threatened a walk-out at the convention. They would only accept a "pro-life" (read anti-abortion) VP nominee. That whittled the list of those who had been properly vetted down to Romney and Pawlenty. Both had issues. Neither rocked McCain's world. Palin was, as Barack Obama, speculated, a "Hail Mary" play by McCain.

Had I 24 hours to vet Palin on August 28, 2008, I would have come up with an entirely different view of her that A.B.Culvahouse and his attorneys did. Way different. Because they did not "politically vet" Palin - not at all - they found out whether or not she paid her taxes on time, that kind of bullsh**. They did not discover whether or not she was capable of serving as vice president - and more significantly, president of the United States. She was not and is not. Period. End of discussion.

So this woman with little experience and all kinds of baggage and no training was unleashed on the voting electorate. In hindsight there has been lots of coverage of her family, their past, her behavior, all the things that come out in a Presidential campaign. Now you have a book coming out about her. What is your book going to do that all the words written about La Palin have not?

First of all, my book will be the first in-depth, cohesive portrait of Palin between two covers. It begins with her childhood - in many ways dysfunctional - and leads through to only a few months ago and her shameful response to the carnage in Tucson. Secondly, I have been leaked thousands of pages of documents - from throughout Palin's life - that no other journalist has ever seen.

I've also gotten some people to talk, both on the record and on background, who have never spilled the beans before.

One of the problems with contemporary journalism is that news cycles are 24/7. So no one has really gone back, for instance, and taken a comprehensive view of Troopergate. That was yesterday's news. I've uncovered emails and other documents that prove conclusively that Palin, her husband Todd, and those in her inner-circle all lied about their involvement. She lied about the findings of the Branchflower Report. She was found guilty of "abuse of power." And abuse her power she did.

I am curious about the people of Alaska. There is the liberal wing which seems to have become energized from her being up there and organizing more. Maybe it is because more people are paying attention, the blogs are getting more attention, the radio up there has been on fire. Even Rachel Maddow went up there. So what can you tell me about the folks up there you have known for a long time whose voices are finally being heard in the lower 48. It isn't so much a voice crying in the wilderness anymore.

Alaska's political culture is as complex as any I've ever seen in the world. People forget that it's an oil-driven economy and therefore it's an oil-driven political system. It's like Louisiana, circa 1933. In many respects, Palin was simply a symptom of Alaska's longtime political culture of corruption.

I do think the left was energized some by Palin's presence (after her nomination), but in the last election, Scott McAdams, the Democratic nominee for U.S. Senate and a great guy, only received 23 percent in a three-way race with two Republicans. Joe Miller, whose politics are somewhere to the right of Attila the Hun, got 35 percent. So don't let Rachel Maddow's cameo in Anchorage fool you. I would say there's been a left wing awakening in Alaska - even a coalescing - but not yet a full-scale movement. One thing I will say: Alaskans by and large are much more practical than ideological in their politics and the parties are less influential than they are in other states. Don't forget, Palin ran against the Republican establishment for governor in 2006 and was elected as a "moderate."

I also don't want you to get the idea that I was only talking to lefties in Alaska. The vast majority of my sources - almost all of whom had the courage to go on the record - are Republicans. The same with the McCain campaign. So my book is not a left wing rant against Palin by any means. It is a balanced, in-depth portrait of a modern American demagogue. People from across the political spectrum are saying: she has no clothes; she's a fraud.

Alright so now I want to know what was it about Palin that drew you to want to look at her behavior and record in a more in depth way?

One of the things that really pissed me off early on in the Palin campaign was her latching on to the "special needs" issue because of her son, Trig. As you know, I have a so-called "special needs" child, and the thought of Palin serving in any way as a spokesperson for special needs kids or for families with special needs kids made my stomach turn. She has never walked the walk. Ever. In fact, I wrote a piece about it for the Chronicle and it was picked up all over the country. So I suppose that was an early impetus.

Then when she began rattling off about "death panels" in respect to Obama's health care reform I hit the roof. It was a flat-out lie. As a survivor of very advanced and very aggressive colon cancer, I've had to deal with end-of-life decisions; I've had first-hand experience. You want to know who the death panels are? They're the medical insurance companies that prevented me from getting a colonoscopy before I turned 50, even though I had moderate symptoms. So I lost several body parts to the death panels. And I had to deal with my father's death in a VA hospital because he didn't have proper end-of-life counseling. Sarah Palin has never dealt with anything like that. My father had an old Navy phrase that fits her to a "T." I will refrain from using it.

I know that one of the things that was missed in the McCain vetting was that Todd had a history with some sort of group that was outside the mainstream, shall we say. What do you know about his participation with that group?

Glad you asked. Because this provides background to one of the more disturbing moments in Palin's VP campaign. Todd Palin first joined the Alaska Independence Party in 1995. During the campaign she told [McCain campaign senior adviser] Steve Schmidt that he had done it as an "accident." It was a flat-out lie. I was shocked when I first had a series of emails read to me confirming this exchange. I obtained Todd Palin's voter registration records through an Alaska Records Act request. Todd Palin registered as a member of the AIP - a party that supports the secession of Alaska from the union - on three different occasions, for a total of nearly seven years.

I know McAdams did not have a good showing in the Senate race. Don't you think that Lisa Murklowski, the eventual winner, went more to the center than she had in the past? Was this in any response to the hard right that Palin had pulled so many people? I mean she (Murkowski) didn't win the Republican primary and had to run as an independent which put all her committee assignments in the Senate into jeopardy.

Lisa Murkowski has always been a moderate Republican. In fact, I think she had to run further to the right because of the Palin/Joe Miller challenge. But in the end, I think she reflects the mainstream of Alaska politics—more practical and less ideological. And she's all about bringing the bacon home back to Alaska. Don't forget, she got 40 percent of the vote as a write-in candidate. Very remarkable.

Now we know Palin is a Tea Party favorite. Do you think she has created enough momentum to carry her in a serious fashion in next year's Republican primaries? Or will she mount a Tea Party effort and run as a third party candidate?

Well, I'm a gambling man, and a few months ago I would have bet any amount of money that Palin would wage a race for the GOP nomination in 2012. That's why she quit her governorship; she hated being governor and wanted to be president. She has clearly been positioning herself for such a run since October of 2008. But her irresponsible remarks both before and after the carnage in Tucson has severely impacted her favorability ratings. I'd say right now her chances of running are 50-50. Her chances of winning the GOP nomination are now a very long shot. The Republican establishment is absolutely united in its opposition to her. Even her former lapdog, Billy Kristol, has signaled his opposition to her candidacy. As for winning the presidency, slim to none. Let us count our blessings.

The Tea Party was effective in getting Joe Miller into the finals of the Senate race last year. Palin endorsed him. Yet Murkowksi won. How does that affect her in the future? She had a mixed bag of results in the primaries so I am curious if this means the Palin brand is not as effective as originally thought?

Let me note that Palin HAD a decent shot of winning the GOP nomination, but she blew it. She was gifted with the instant celebrity that went with her selection by McCain - and celebrity now plays a role in the election of a president - and she had a solid brand that stood squarely in opposition to Obama. She is the anti-Obama, if you will. But she has blown it both tactically and strategically over the past two years. She can't put an organization together. She is absolutely dysfunctional. And she is a pathological liar, so she can't keep her story straight. Palin had it all handed to her - and her various pathologies have brought her down. It would be a Greek tragedy if she weren't such a farce and a lightweight. Her fall is a Shakespearean comedy. And she has fallen.

One of thing my book does is re-examine as "text" some of her more infamous verbal moments - the Katie Couric interviews; her gaffe believing that the Canadian radio comedian was actually French President Nicolas Sarkozy. It was funny when it happened, but if you go back and read the text of that interview, follow it closely as it were, you see what an absolute imbecile she is, how ridiculous and fatuous she is to the point of being moronic. Ditto for her Katie Couric interviews. Ditto for her first Farewell Address when she resigned as governor. I view her as an embarrassment to the grand traditions of American democracy.

How is she on LGBT rights? What is her record? Has it changed over the years?

This is probably the one issue where Palin has appeared to have been more "progressive" than most evangelicals, although much of that is myth. Palin came of age in Alaska under Title IX, and there was clearly a lesbian jock subculture on Palin's high school basketball team and among her close friends. I've had several people confirm that. There's also been a subculture in Palin's inner-circle of bisexuality. Several people have told me that some of Palin's aides clearly had "girl crushes" on her. And that emanates out into the blogosphere - one of her biggest media supporters is Tammy Bruce, and Palin recently retweeted a Bruce Twitter posting implying that she vaguely supported the repeal of "Don't Ask, Don't Tell" in the military. If there's a single word that describes the political culture of Alaska it's "libertarian," with a lowercase "l." What happens behind closed doors is your business. I would describe them as fiscal conservatives, almost universally pro-resource development and socially libertarian - and so that position fits safely in that political culture.

But when her daughter Willow famously ranted about "fags" on her Facebook page last November during her sister's run on Dancing with the Stars, Sarah Palin did nothing, said nothing. Her position on LGBT rights is wishy-washy at best. She opposes gay marriage. She has danced around the issue of benefits to same-sex partners. Shortly after she was elected governor, she vetoed legislation that would have prevented the state from providing benefits to same-sex partners - but then indicated it was only because the Alaska Supreme Court had issued a ruling requiring that the state offer the same benefits to all state workers. Sarah Palin usually sticks her finger in the air before taking on a stand on any position. She has no moral compass when it comes to LGBT rights.

My sense is that she doesn't care one way or the other about LGBT rights - she's no Jerry Falwell or Pat Robertson or James Dobson - but she also doesn't want to alienate her right-wing base by getting too far out over her skis on the issue.

With the May release of your book, are you at all concerned about what your reception will be the next time you go to Alaska? Do you think you will be targeted by the Palinistas now?

I was already targeted by the Palinistas on my last stay in Alaska - some guys with big beer guts and pistols on their hips tried to intimidate me at a rally, but the fact is that Sarah Palin is the one who's really despised in Alaska, not me. Her favorability ratings have fallen through the floor. Plus, Palin is not well liked by law enforcement in Alaska, especially the Troopers, and since I'm dedicating my book to the former Police Chief of Wasilla, Irl Stambaugh, and the former Police Chief of Anchorage and Public Safety Commissioner of Alaska Walt Monegan, and since I clear his name, Trooper Mike Wooten, uh, I'm feeling pretty comfortable up there. Plus, Gary Wheeler, Palin's former security detail gave me an insightful interview. They are all pretty tough guys. I have lots of friends from all over the state from all political persuasions. I'm feeling pretty safe.

Here's my last question for you. We are both life long Gigantes fans. Do you have any thoughts about winning the Series and about the new season?

While I was struggling with finishing the book in the fall of 2010, Los Gigantes made their incredible run to the World Championship - doesn't that sound great? - and they inspired me to finish this book when the going was getting pretty tough. It was an incredible season and the dramatic arcs kept my juices flowing all the way through.

But here's the real secret about Palin and the Giants. At some point, my friend Joe McGinniss, who is also writing a book about Palin, told me that someone had attended a Giants game at Candlestick Park with her more than a decade ago. And it sort of bummed me momentarily to find out that Palin had actually been to Candlestick. Then again, I had been to Wasilla High School's gym, so I guess we were even. But then I was covering a speech that Palin delivered in San Jose and she sort of mocked the Giants having not won the championship since 1954 - she obviously knew none of the team's history; it was all a pat speech - and at first I worried that the Palin jinx might haunt them, but then I watched the next game with my mom and I realized that in this case, the jinx was going to work the other way, Palin's mocking had sealed the deal for us. In my acknowledgments I thank "Willie Mays, Vincent Van Gogh, Joan Didion, Blood on the Tracks, Keith Olbermann and the 2010 San Francisco Giants." I needed all of them to get there.