"Rick Perry Conspired With Multinational Bank To Raise Revenues Off The Deaths Of Texas Teachers"
According to sources and notes provided to the Huffington Post, the Perry administration solicited support for the idea from teacher associations, and pressed a deal where teachers would receive between $50 and $100 to sign a contract granting UBS the right to bet on their death using life insurance policies. Perry’s budget director Mike Morrissey said it would take up to 12 years for Texas to “earn” money from the scheme, but eventually the state would gain a $700 million windfall if the system could recruit 40,000 retired teachers.
An intriguing twist to the story is former Sen. Phil Gramm (R-TX), who joined UBS as a top executive after he left the Senate and has served as a political mentor to Perry since the late ’80s. Gramm, an architect of Wall Street deregulation while in Congress, aggressively lobbied the “gruesome” deal:
Gramm and UBS had concocted a gruesome combination of what are now regarded as two of the most infamous Wall Street scams on record. The resulting package closely resembled the growing market for mortgage-backed securities, but instead of allowing Wall Street to bet on peoples’ homes, it would enable bets on peoples’ lives. [...]
The plan was to have UBS buy the life insurance policies with mega-insurer AIG, then bundle those policies into securities, and sell them off to a small group of investors. By keeping the investor group small, Gramm could avoid the public and regulatory scrutiny required by standard public securities sales. He wouldn’t even have to disclose details of the scheme to the Securities and Exchange Commission. [...]
In one ghoulish section from the meeting notes, Gramm emphasized that the actual payments to the state would depend on who died, and when. “These amounts depend on interest rates and deaths,” the notes read. “They can’t price it yet, or estimate the amount of money available annually to TRS until the bank looks at the universe of those participating.”
Gramm endorsed Perry earlier this month and hinted at a major role in his campaign, and perhaps presidency. Although Perry failed at enacting his dead-teachers speculation scheme as governor, its not clear if he will try again with a similar plot if takes the White House in 2012.
Read the full story at the Huffington Post.