Bullfighting is a dangerous sport; the bull wins by lethally plowing into the matador. Nevertheless, President Obama is trying his hand at bullfighting and he’s using unconstitutional trickery to shield himself from a lethal political blow. In Obama’s case, the bull’s name is “Wall Street”—the lifeblood of American culture.
Think of Wall Street as a bull bursting with strength and fecundity—an animal taking risks and producing deals that other animals cannot—risks and deals that create wealth and jobs. Well, Obama seems determined to “kill” Wall Street capitalism and replace it with socialism. And he is employing trickery like stuntmen and scapegoats to win public support for his “bullfight.”
Truly, the federal government, not Wall Street, perpetuates our economic downturn and I’ve already discussed how former President Bill Clinton’s actions unleashed the financial crisis. So, please ignore Obama when he blames the financial crisis on “insider trading.”
First, there is no definition of insider trading. Dean emeritus of the George Mason University School of Law, Henry G. Manne, tells TIME Magazine: “Neither the SEC nor Congress has ever defined inside information, nor has either succeeded in specifying the level of significance the information must have to be the subject of a criminal violation.”
Secondly, insider trading regulations are largely unconstitutional because they violate property rights or free speech—giving the government the authority to clutch intellectual property or tap conference-call lines without probable cause.
Thirdly, there is no evidence that so-called insider trading hurts the economy. Some economists believe that insider trading benefits the economy because information flows freely and more businesspeople will take wealth-creating risks.
The Stuntmen
Obama enlists two primary “stuntmen” to bludgeon Wall Street. They are:
1.) The SEC
“In a free society a company belongs to its owners--the shareholders--not to the government. …Prior to the establishment of the SEC in the 1930s, the government properly did not violate the right of a company's owners to control, by means of corporate by-laws, the practices of corporate executives regarding stock ownership and inside information. The government recognized that proprietary information belonged to the company's owners. However, this respect for property rights began to erode as regulations and prohibitions on insider trading were gradually imposed,” Andrew Bernstein points out in the National Post.
The Obama Administration is increasingly using the SEC to unconstitutionally bypass Congress (America’s true lawmaking body) in order to regulate intellectual property and free speech. FOX Business reported on February 15 that the SEC is expanding its net on what it considers to be insider trading to include everyday business conversations that are necessary for analysts, investors and financial executives to perform basic functions.
2.) The U.S. Attorney for the Southern District of New York
In 2009, at the prodding of New York Sen. Chuck Schumer, Obama appointed Preet Bharara to be the U.S. Attorney in Manhattan. Bharara is using unprecedented and unconstitutional tactics to prosecute high-profile “insider trading” cases on Wall Street.
Bharara’s unscrupulous tactics include utilizing wiretaps without probable cause; pressuring lower-level defendants into becoming tattletale “informants” against sexy Wall Street execs; and using circumstantial and emotive evidence to sway juries and judges into handing Wall Street traders record-long prison terms.
The Scapegoats
I’ve already written about Obama’s high-profile scapegoats like Raj Rajaratnam, the billionaire entrepreneur and founder of the Galleon Group hedge fund management firm. Well, Obama’s latest scapegoat to sell socialism to the public is Rajat Gupta.
Gupta is the former head of McKinsey & Co. and a past board of director for both Procter and Gamble and Goldman Sachs. Gupta is a 63-year-old first-generation immigrant from India who relied on hard work to rise in the American business world. Gupta’s colleagues traveled long distances to offer testimonies of his character and honesty on the witness stand, such as Ashok Alexander, a manager for the Bill and Melinda Gates Foundation, who trekked from New Delhi to Manhattan.
Using almost entirely circumstantial evidence, Bharara and the Obama Administration accused Gupta of passing “inside” information to Rajaratnam, including “tips” from an Oct. 23, 2008 Goldman Sachs board meeting. However, Gupta’s lawyer pointed to news articles indicating that the information Gupta shared with Rajaratnam was public knowledge as early as Oct. 13, 2008 and FBI wiretaps indicate that Gupta may have called Rajaratnam to simply “catch up.”
It is also doubtful whether the federal government had “probable cause” for wiretapping Gupta’s calls (a requirement per 1968 wiretap law.) Yet, Gupta faces up to 25 years in prison for his seemingly ordinary business communication. (Rajaratnam is currently serving 11 years for similar charges.) Thanks to Bharara’s unprecedented tactics, a federal jury found Gupta guilty of insider trading last week and his sentencing is set for Oct. 18.
My assessment is that Gupta is another high-profile victim of Obama’s attempt to deflect blame and sway the public that capitalism is corrupt and more socialist policies (i.e. more government intervention) will solve a government-induced financial crisis.
Bottom line, if it weren’t for his stuntmen and scapegoats, the “bull” called Wall Street would have trampled Matador Obama’s socialist PR campaign long ago.