June 2, 2008

A cheery guy, that Phil Gramm. According to Newsweek, he brought his zest for life into his work as a banking industry lobbyist, and no, we're not just talking about the subprime mess and tax evasion he and UBS pioneered. From Newsweek, via Progress Ohio:

McCain's campaign is already distancing itself from some of Gramm's other work for UBS: his involvement in attempts to sell financial products known as "death bonds," which BusinessWeek described last summer as one of "the most macabre investment scheme[s] ever devised by Wall Street." Not long after joining UBS, the Houston Chronicle reported, Gramm helped lobby Texas officials, including Gov. Rick Perry, to sign on to a UBS proposal in which revenue would be generated for a state teachers' retirement fund by selling bonds, whose proceeds would in turn be used to buy annuities and life-insurance policies on retired teachers. UBS would advance money to the retirement fund, then repay itself, compensate bondholders and pocket profits when insurance companies paid off on retirees who died. According to a banking-industry source, who asked for anonymity when discussing a sensitive matter, Gramm was involved in efforts to pitch similar UBS products to other financial institutions.

Gramm's office declined NEWSWEEK's request for comment. A source familiar with the bank's current business, who also asked for anonymity, said UBS no longer markets the kind of plan that Gramm was allegedly trying to sell to Texas. Hazelbaker said that McCain, who has been critical of the financial industry's performance in the subprime market, disapproves of death bonds and "supports increased accountability, transparency and capital backing in our financial markets as a solution to these problems." Death bonds, she continued, "move markets away [from]—not toward—these goals."

It's good to know McCain disapproves of just about every type of business in which his economic advisor engaged.

And hey, I remember Jill Hazelbaker! That chipper young lady and hearty sock puppet called me a "trash journalist." Which of course is only slightly preferable to "death bond salesman" or economic advisor to Team McCain (oops, redundant).

Just perhaps, and I am spitballing here, this kind of cynical attempt to cash in off of the exploitation of legislative loopholes and their fellow countrymen, is why-- as my friend David Sirota puts in his new barnburner of a book "The Uprising,"-- there is a populist revolt brewing around the country (see the 82% who think we are headed in the wrong direction).

Cross-posted at Cliff Schecter's Campaign Silo

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