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April 22, 2010
Corporate cronyism or gangster government? You decide
Andrew Mellon at Big Government has a true blockbuster:
At the end of 2007, hedge fund billionaire John Paulson invested $15 million in the leftist non-profit, Center for Responsible Lending, their largest single donation ever. Around the same time, Paulson and his employees contributed over $100,000 to the Democratic Senatorial Campaign Committee, headed, at the time, by Sen. Chuck Schumer. Roughly six months later, CRL and Sen. Schumer both launched a highly public attack on the California-based mortgage lender, Indymac. The lender failed, wiping out the investment of thousands of people. Roughly six months after that, John Paulson, in partnership with George Soros, bought up the remnants of Indymac for pennies on the dollar.
It is a drama that no longer surprises us, unfortunately. Wealthy investors use their access to elected officials and their checkbook to advocacy groups for private profit. But this story has a twist; a top executive of CRL when this deal went down, Eric Stein, is now working at the Treasury Department, heading up the proposed Consumer Financial Protection Agency. Mr. Stein will be the chief federal official designing regulations to protect consumers. Right