Larry Summers, Epstein and the “End Game” Memo

A guest editorial/report you're going to want to read from my longtime buddy and one of the world's best investigative reporters, Greg Palast...

Forgive me, but I have to send a little thank you to Jeffrey Epstein. The latest cache of the predator’s memos have finally brought down Lawrence Summers, once President of Harvard University, once US Secretary of the Treasury and the dark eminence behind banking deregulation and mass home foreclosures. And worse.

The newly released emails revealed that Epstein agreed to be Summers’ “wing man,” advising Summers on how to use coercive power to maneuver his female protégé into the sack.

I should write, “The Honorable” Larry Summers. He keeps his “Hon.” honorific as a former Cabinet member, though I wonder how honored Larry’s wife feels having to read the icky Epstein emails in the New York Times.

Summers was also a frequent flyer on Air Epstein.

But let’s set aside Larry the Lecher (I’ll leave that to The Times.) This is the moment to reveal how Summers has used his power not just to abuse women but to abuse the planet. His victims number in the millions. No kidding. Stay with me on this. We begin with the “end game.”

The End Game Memo

In 2013, a little birdy dropped a highly confidential note written to Summers from his flunky, Timothy Geithner, then Assistant Secretary (International Affairs) to the World Trade Organization. Its content was so explosive, so sick and plain evil, I just could barely believe it.

The scheme revealed in the note was breathtaking: complete deregulation of the WORLDWIDE banking system.

The End Game Memo confirmed every conspiracy freak’s fantasy that top US Treasury officials secretly joined up with a cabal of banker big-shots to rip apart financial regulation across the planet.

Geithner wrote to then-Deputy Secretary Summers,

“As we enter the end-game of the WTO financial services negotiations, I believe it would be a good idea for you to touch base with the CEOs.”

To avoid Summers having to call Geithner to get the phone numbers (which, under US law, would have to appear on public logs), Geithner listed their private lines. And here they are (with X’s so as not to dox or cause innocent people problems):

Goldman Sachs: John Corzine (212)902-XXXX
Merrill Lynch: David Kamanski (212)449-XXXX
Bank of America, David Coulter (415)622-XXXX
Citibank: John Reed (212)559-XXXX
Chase Manhattan: Walter Shipley (212)270-XXXX

CEO Reed at Citigroup picked up our call, but when it wasn’t Larry on the line, he hung up. Other numbers were changed.

Most important, the banker-Treasury lock-up succeeded beyond imagination. How? We’ll get there.

Memorandum for Deputy Secretary Summers: The “End Game” memo.

Going to “Vegas.”

A nibble of history is needed here.

Summers’ boss as Treasury Secretary Robert Rubin, was appointed by Bill Clinton after Rubin’s stint as Co-chairman of Goldman Sachs. Summers and Rubin had seduced the President into a radical de-regulation of the banking system.

The Summers’ plan would allow banks to speculate in in the new “derivatives” market with your government-guaranteed savings accounts. What had once been a crime was now government policy.

The banks ran straight to Vegas and gambled it away. All of it.

But they didn’t go home empty handed. Banks and insurance companies got a half-trillion-dollar taxpayer bail-out AND a $7.77 trillion back-up from the Federal Reserve.

But before the markets imploded, Rubin left the Treasury to Chair CitiGroup, a Frankenstein of de-regulation created by eliminating the Glass-Steagall Act, FDR’s precious gift to us to prevent stock market swindles. Rubin’s starting salary: $126 million.

Most important, Rubin made sure Clinton would pick a replacement — Larry Summers — who wouldn’t stop the de-regulation grift.

“What Would Goldman Think?”

To get that confirmation of the memo’s authenticity, first I would have to fly to Geneva and, as a BBC reporter, wangle a meeting with the General of Globalization himself, Pascal Lamy, Secretary-General of the World Trade Organization.

Lamy told my audience, “The WTO was not created as some dark cabal of multinationals secretly cooking plots against the people… We don’t have cigar-smoking, rich, crazy bankers negotiating.”

Then I showed him the End Game Memo. He disavowed knowing about the Summers confabs in the memos nor the extortion that would turn the WTO into the enforcer of bank deregulation.

Then I remembered something Nobel laureate Joe Stiglitz told me. We happened to be giving lectures on the same night at London School of Economics (I was once a bit of an academic). The next day we spent hours talking about globalization — and Larry Summers.

I did not have the End Game memo yet. But Stiglitz told me that secretly sharing Treasury plans to get approval from Big Finance was apparently Standard Summers Operating Practice.

Stiglitz was Chairman of Clinton’s Council of Economic Advisors. He’d meet the President weekly, joined by Summers and Rubin. When Clinton was out of the room Stiglitz said that Summers would ask Rubin, “How would Goldman feel about that? How would Goldman feel about that?”

Finally, the disgusted Stiglitz asked Summers, “Why do we care what Goldman Sachs thinks; isn’t it about what’s good for the public?” He said Summers and Rubin looked at him as if he were a silly naïve child.

The “IMF riots”

But I still haven’t gotten to the worst part: When Summer was Chief Economist of the World Bank from 1991-1993, he literally imposed a policy of starvation on citizens of the Third World

Summers didn’t call it “The World Bank Plan to Starve You.” he called it, “Structural Adjustment.” From Ecuador to Bosnia to Ivory Coast, the World Bank and its partner, the International Monetary Fund, ordered nations to raise prices on food and cooking fuel, sell off their water systems to Enron (really!) and crucially, open their banking systems to Citigroup, Goldman, JP Morgan and all of Larry’s buds.

What set me on Summers was a whole stack of confidential documents passed to me by brilliant investigators Mary Bottari of the Center for Media and Democracy and Lori Wallach of Public Citizen. They had gotten hands on hundreds of secret directives from the World Bank.

I put thick, confidential plans for several nations in front of Stiglitz. Notably, he had taken Summers’ post at the World Bank. He authenticated them — though I must emphasize he did not provide them.

He was horrified but not shocked. Stiglitz knows all about Summers fronting for banks’ demand for finance deregulation, the sell-off of government industries to well-connected cronies, the radical free-trade agenda and the end of food and fuel support for the poorest of the poor.

Structural Adjustment led quite directly to rural starvation worldwide and what Stiglitz called, “The IMF riot.” The World Bank and IMF knew that mass suffering would provoke rioting which would lead to tanks in the street, martial law and the imposition of the Structural plans.

Stiglitz noted that In Russia, the privatization plan — Stiglitz called it “briberization” made billions for oligarchs (and millions for Harvard “consultants”) while Russia’s life expectancy plummeted.

Bankers Go Bananas

But turning American banks into derivatives casinos was not enough. The planet was ripe with juicy gobs of capital from resource revenue.

How could they pluck the planet? The answer conceived by the Big Bank Five: eliminate controls on banks in every nation on Earth in one single move. It was as brilliant as it was insanely wreckless.

How could they pull off this mad caper? The bankers and Summers would use the Financial Services Agreement (FSA), an abstruse and benign addendum to WTO trade agreements.

Until the bankers began their play, the WTO agreements dealt simply with trade in goods — that is, I sell you cars and you sell me coffee. The new rules ginned-up by Summers would force all nations to accept trade in “bads” — toxic assets like financial derivatives.

Until the bankers’ re-draft of the FSA, nations regulated the banks within their own borders. The new rules of the game would force every nation to open their markets to Citigroup, JP Morgan and their derivatives “products.”

Fun fact: JP Morgan alone would soon carry $88 trillion of these pseudo-securities on its books as “assets.”

All 156 nations in the WTO would have to smash down their own Glass-Steagall “fire-walls” between commercial savings banks and the investment banks that play with risky derivatives.

The job of turning the FSA into the bankers’ battering ram was given to Geithner, who was assigned to represent the US to the World Trade Organization for this purpose.

Bankers Go Bananas II

Why in the world would any nation agree to let its banking system be boarded and seized by financial pirates like JP Morgan?

The answer, in the case of Ecuador, was bananas. Ecuador was truly a banana republic. The yellow fruit was that nation’s life-and-death source of hard currency. If it refused to sign the new FSA, Ecuador would have to feed its bananas to the monkeys and go into bankruptcy. Ecuador signed.

And so on, with every single nation bullied into signing.

Every nation but one, I should say. Brazil’s new President, Inacio Lula da Silva, refused. In retaliation, Brazil was threatened with a virtual embargo of its products by then European Union Trade Commissioner, Peter Mandelson, according to another confidential memo I got my hands on.

NB: Mandelson was fired this September as Britain’s Ambassador to the US after he too was found deeply entangled with Epstein.

Ecuador, once its bank sector was de-regulated and its economy “structurally adjusted,’ exploded into riots. Stiglitz told me that inside the World Bank, these were called, “IMF riots,” which were not only predicted but planned into the re-structuring agreements. The crackdown was also predicted. Tanks in the street and marshal law would allow the implementation of the full structural smash and grab.

My Argentine friends told me Structural Adjustment led to school teachers hunting in garbage cans for food. Ensuing protests and riots did not stop the sell-off of the nation’s oil company to Spain and the Buenos Aires water system to Enron.

Then, Bankers Gone Wild in the Eurozone dove head-first into derivatives pools without knowing how to swim; Goldman and others drowned Europe in near-worthless derivatives.

Does all this evil and pain flow from the single End Game memo? Of course not: the evil was The Game itself, as played by the banker clique. The memo only revealed their game-plan for checkmate.

BBC reporter Greg Palast interviews Quechua crowd outside Ecuador’s Presidential Palace over an IMF Structural Adjustment Plan which eliminated support for food and cooking fuel. Riots forced the President to resign. (Photo: Palast Investigative Fund, 2005. Reprints permitted.)

Summers Killed off Foreclosure Relief

It didn’t take long for the frozen imported chickens to come home to roost. The 2008 implosion of the mortgage market, caused by the creatures of deregulation — subprime mortgages and derivatives gambling — led to a bail-out. Rubin’s Citigroup got a $45 billon gift plus $306 billion in loan guarantees, while Goldman got $10 billion plus $37 billion in various guarantees.

But the 12 to 15 million people who lost their homes to foreclosure (HUD calculation) got bupkis, nothing but marshalls breaking in their doors. Franklin Roosevelt saved Americans from mass homelessness during the Depression with a successful moratorium. So, newly-inaugurated Barack Obama sent his new Economics Tsar, Larry Summers to Congress to testify that he would endorse a bill that would block millions of foreclosures.

But in private, Summers convinced Obama not to invoke a moratorium. Summers craftily made sure Sen. Elizabeth Warren was cut out of the Obama meeting. “Tzar” Summers was backed by his Tsarina, US Treasury Secretary Tim Geitner.

Revenge of the Women Economists

I could go on: Summers cashed in on one of the bastard spawn of bank de-regulation: so-called peer-to-peer lending schemes. It’s basically loan-sharking in cyberspace.

That scam, along with fees for consulting work with Citigroup, boosted Summers net worth now estimated at $39 million. Not bad for a professor.

It’s no surprise that a man who held literal life and death power over Ecuador would use his life and death power over a young woman’s career to get into her pants. Privilege = Power. And to the Epsteins and Summers of this world, what’s the use of power if you can’t abuse the power.

I don’t think Larry likes me. Not since I sent the End Game Memo to Sen. Sherrod Brown, in 2013, the Chairman of the Subcommittee on Financial Institutions and Consumer Protection. The senator blocked Summers from being appointed Chairman of the Federal Reserve Board.

Summers once said that the reason few females get professorships in economics and quantitative fields is that women “lack an intrinsic aptitude at the high end.” In other words, ladies, you’re too stupid to be economists. So, I was thrilled that, after President Obama dumped Summers’ nomination as Federal Reserve Chairman, the President replaced Larry with another one-time Harvard Professor, Janet Yellen!

---

Before he turned to journalism, my dear old friend Greg Palast lectured on economics, statistics and investigative reporting at Cambridge Univ. School of Applied Economics, Harvard, London School of Economics, Columbia University and Univ. of Sao Paolo. Sign up for his free reports on Substack and follow him on Substack at @gregpalastinvestigates.

---