BIOS. Click. 











The Money Lords, the Drug Lords, the Slum Lords, the "Pug Winokur Data Dump".

by Catherine Austin Fitts © 2000 

by Catherine Austin Fitts © 2000

Click. BUSHWACKED: HUD Fraud, Spooks and the Slumlords of Harvard by Uri Dowbenko 
© 2000.



THE CONSPIRATORS Secrets of an Iran Contra Insider by Al Martin © 2000 

There were about 100 such projects in all which were ultimately bailed out by some public guarantee institution. It wasn't necessarily the FDIC or the FSLIC, but in some cases, very esoteric public guaranteed funds were used to bail these deals out. George Jr. naturally specialized in oil since he controlled the Bush family oil portfolio including Harken Energy stock, Tidewater Development stock, and Apache and Zapata stock. These were all deals where George Sr. had formerly been on the Board of Directors. Now George Jr. was on the Board of Directors, since Sr. as Vice President couldn't have that capacity. Harken Energy was a classic fraud. The stock still trades on the AMEX at five or six dollars a share. It's been pumped up recently because there's a new fraud going on with those Bahrainian Leases that Richard Secord originally had ten years ago. The stock will shortly collapse back to two dollars again, as soon as everybody gets out. A lot of Republicans will make money on the deal. .... 

I also have a lot of documentation pursuant to George, Sr.'s involvement in fraudulent deals surrounding Zapata and Apache Energy. I have a lot of stuff with him in Harken Energy, also including a lot with George, Jr. in Harken Energy. That's another possibility. But again, these weren't large frauds. They were little security frauds, the fraudulent diversion of monies in those bogus Bahrainian leases when they temporarily ensconced Richard Secord to be their Middle­Eastern Director for Bahrainian Operations which existed in a file drawer. What that Bahrainian deal came down to was George Bush, Sr.'s close friend, former Saudi intelligence chief and major Iran­Contra figure, Ghaith Pharaon. That was just a donation to Iran­Contra by the Saudi government. And that's what the bogus Bahrainian lease deal effectively comes down to. It wasn't much ­­ $38 million, something like that. Secord received about $3 million for his own pocket. Harry Aderholt was thrown a bone out of the deal. It was no big deal really. I also want to discuss an overview of Bush family fraud, ala Iran­Contra profiteering. .......   

The Tri­Lateral Investment Group, Ltd. is also one of the deals (one of the very few deals, perhaps only a few dozen deals in that era by this group of guys) that you could connect Jeb, Neil, George, Jr., Prescott, and Wally Bush. All five ­­ you can put in the Tri­Lateral Investment Group, Ltd. You can put Neil in it vis­a­vis Tri­Lateral's dealings with Neil's Gulf Stream Realty. Then you back up a step and put Neil Bush into Tri­Lateral Investment Group's dealings with the Winn Financial Group of Denver run by the infamous former Ambassador to Switzerland, Phillip Winn. You can put George, Jr. in the deal vis­a­vis the Tri­Lateral Group Ltd.'s fraudulent relationship with American Insurance General (AIG) , of which George, Jr. was a part through the same series of fraudulent fidelity guarantee instruments issued on behalf of Harken Energy from American Insurance General. Tri­Lateral Investment Group then sold bogus oil and gas leases to AIG. This is a direct fraud that George, Jr. profited to the extent of (not a lot) $1.6 or $1.7 million. But it was a clear out­and­out fraud.

Rolling Stone magazine did a good piece on George Bush, Jr. and three of his oil and gas companies which failed. But the article really didn't go far enough. It did not go really into Harken and Tidewater and other public corporations which George, Jr. was involved in and in which securities fraud was committed. He was able to neatly skirt the laws ­­ or should we say ­­ deflect the shit away from himself through a whole series of contrivances. The way he was able to do this, by the way, was to post these essentially bogus fidelity and guaranty instruments, so the deals wouldn't be scrutinized until long after they had collapsed. 

This was one of George Jr's specialities ­­ and I did this myself, by the way. It was a common tactic in Iran­Contra Securities Fraud. As the expression goes, it was to "back in" fraudulent assets, normally of a real estate nature, to back in fraudulent assets into a public shell. More commonly, they were known by their regulatory names in those days as a Reg D offering, or a Reg 501 or 505, or an S1, S3 or S18 offering. These were the common euphemisms used in the day. This is, of course, Security and Exchange Commission language, or "SEC speak" as we used to call it, for various types of offerings, which govern how large these offerings could be, how many states they could be 'blue­skied' in (meaning how many states they could be sold in), the total amount of money that could be raised, the market making regulation that was necessary to maintain a market in the shares thereinafter. 

Anyway, a very common securities fraud was the use of 144 stock. 144 stock refers to Rule 144, or Restricted Shares (shares that are not free to trade under the two­year restriction rule). Often a company that would nominally have ten million shares outstanding could issue a hundred million shares of 144 stock that would then be sold at a steep discount to the market price. If you had a stock trading at a dollar, you would issue scads and scads of 144 stock, and you sell it for twenty cents a share. This stock would get bounced out into offshore bank loans, principally through the Union Bank of Switzerland, but also through a whole host of offshore banks through the Caribbean. 

The large French bank, Banque Paribas, for instance, was notorious for this because of George, Sr.'s relationship with the bank. What would happen is you would raise an enormous amount of money, but you would also have an enormous amount of restricted stock, out of which at some point, the letter (what is known as the restriction or the letter) would come off that stock, and that stock is going to come bouncing back at some point to the market makers. 

Because the scheme was at the banks, this was only meant to be interim financing. We are now talking about cooperative banks who were not meant to be burnt. They were just meant to provide bridge financing. This was very, very true with Union Bank of Switzerland, Royal Trust of Canada, and Imperial of Canada, Banque Z of Curaao, Banco de Populare. These were banks that you did not burn. These banks just acted as facilitator banks. But you have to make them "whole" in the end. Now, if you bury them under a pile of 144 stock, how did you make them "whole" in the end? How you made them "whole" is by pumping up the deal as the letter began to expire on the 144 stock that was out. 

You would pump up the shares artificially in the marketplace and begin to bleed the stock back through your market makers at forty or fifty cents on the dollar. You would make money again. You had originally borrowed twenty cents on the dollar. You perhaps would bleed the stock back into the marketplace at forty cents on the dollar by the tactic of what is known as "back­dooring" the stock to your market makers and dealers, and issuing certain guarantees to them that they in turn would be made whole. The ultimate bag-holder in these deals, of course, are the people that bought the hype, the people that bought the endless press releases, most of which were all bogus. 

In some cases, we would have to make the representation that Company A has a tremendous new product or that it just has a contract with the International Monetary Finance Corporation. And boy, this is just going to be the greatest since sliced bread. Of course, what the prospective hypee didn't know is that the International Monetary Corporation was in fact a shell that had been formed by the very same people who had perpetrated the original fraud. It is the only way you could keep control of the hype. So you would have one bogus company signing a contract to purchase ten zillion widgets from another bogus company. Not only did the widgets not exist, but both the companies themselves were essentially worthless. In this way, you could pump up the price of the shares and be able to create enough liquidity, enough excitement in the shares to distribute all of the stock, all of this 144 stock that you had bouncing back. Since the problem was obvious, you would vastly expand the flow to the shares ­­ in some cases, by a factor of ten. 

There were previously, let's say, 10 million shares authorized, but usually there was 300,000 or 400,000 shares that were actually out. The rest of it was buried in the hands of dealers or constituted restricted stock. So what would happen is towards the end, when the deal would falter, you could always give the deal a second shot by instituting a reverse stock split, which would bring the stock back up to a level where penny stock investors and speculators felt more comfortable, and also back to a level where the shares would then again meet certain regulatory hurdles, thus making it easier to distribute the stock. You took the stock that was originally done and pumped it up to a dollar. In order to maintain it at a dollar and absorb all the stock, you needed a constant flow of hype. 

When the shares eventually sank (because the distribution began to back up on the dealers a little bit), you would give the stock a secondary chance by instituting a reverse stock split. That would boost the price of the shares back up to where they were, usually even higher. Of course the spreads would widen out, and as anyone knows in reverse stock split penny deal, the spreads always get very, very wide. But you simply disguise those spreads. 

The dealers can very easily disguise those spreads by either not posting Bids and Asks on the pink sheets, or just posting so­called nominal Bids and Asks which would give the appearance to the would­be investor that the stock was substantially more liquid than it was. But the reverse stock split was always the last link in the chain of the fraud of the underlying deal. Because the last time you would pump it up would be through this artifice, this device using a reverse stock split. It wouldn't be long thereafter that simply the deal would fall apart, and you could distribute the stock all the way back down to a penny bid, three cents offered, which we did on a lot of deals. 

Once the broker/dealers were out ­­ or were "whole" financially ­­ as well as your other market makers and specialists, once you had made them whole financially, because you had so severely discounted the stock to them to begin with, then there would always be 30 million or 40 million shares left over. And the Bids and Asks would quickly go to like a penny bid, three cents offered, but with that, you would get a whole new crop of potential investors. You would keep a little bit of hype there. You'd keep a little bit of activity and spread on the sheets. And there's a whole lot of people that will buy 10,000, 20,000 shares of a two or three cent stock in hopes that it might be a twenty or thirty cent stock. You do open yourself up at a penny ­­ making a market of one and three cents ­­ you open yourself up to a whole new crop of speculators that will be sellers of a deal at twenty cents, not buyers of a deal at twenty cents. 

We use to call these type of penny speculators "green feet." We used to delineate them by where the stocks traded, on what sheets, in other words. For instance, a pink sheet speculator is someone who bought higher priced penny stocks and shares that traded in the low dollars. Of course, when the stock fell down below the pink sheet regulatory level, it would be kicked down to the green sheets. That's where you find the one cent, three cent, five cent stocks. When they could no longer be maintained at that level, they would be kicked down to the yellow sheets. That's where you would sometimes see stocks trading in mils ­­ so many mils bid, so many mils offered. As long as there was still somebody willing to buy it, a market could be maintained, particularly since the stock, by this point, did not cost anything to the broker/dealers or those who initiated the fraud. Everybody was out and clean and made their money, and public shareholders were the ultimate bag holders. But you could actually keep these deals floating and alive for a long time before they absolutely fell apart. 


 T H E W H I T E H O U S E Harvard Commencement Day, 1994.

Vice President Al Gore Thursday, June 9, 1994 

A Harvard commencement is a special occasion. How could anyone not have been thrilled by this morning's assembly -- 25,000 people packed into Harvard Yard to celebrate one of the great occasions of life. I loved it all. And I have especially enjoyed my 25th reunion. I'm so proud of my class. It has been wonderful to have an opportunity to visit with so many friends. I remember the 25th reunion class when they came in 1969 walking around the Yard with their children. They seemed like ordinary people. I remember that they seemed older then than we do now. But in fact they were responsible for one of the saving triumphs of modern civilization. 

That was the class of 1944. They were part of the generation President Clinton commemorated this week in Normandy, the group that went from Harvard to boot camp and basic training and from there were transfused into the weary divisions battling across Europe. Only 11 members of the class were present at graduation; all the rest had by then already left to enlist. Some did not come back to their reunion. Their names are carved in stone in Memorial Church just behind me. Many did come back and some of them are here again today for their 50th reunion. We salute you. 

Back in 1969 our graduating class was in no mood to salute or to celebrate your sacrifice your achievement. But we understood then and understand now ever more clearly that without any question because of your service, the world changed in 1944. Indeed, our world a half century later is still shaped by the events of that tumultuous and triumphant year. I want to describe today the reasons why I believe the world also changed in important and enduring ways because of the events of 1969, a year of contradiction and contrasts, of glory and bitterness. In July 1969 one-quarter of the population of the world watched on live television while Neil Armstrong brought his space module Eagle down to the Sea of Tranquility, slowly climbed down a ladder and pressed his left boot into the untrod surface of the moon. But 1969 was also the year Charles Manson and his followers made the innocent words Helter Skelter symbols of a bloodbath. It was the year of music in the rain at Woodstock and the year of the My Lai Massacre in Vietnam. 

While we went to class and heard lectures and wrote papers and listened to music and talked and played sports and fell in love, the war in Vietnam was blasting that small country apart physically and ripping America apart emotionally. A dark mood of uncertainty from that tragic conflict clouded every single day we were here. The year 1969 began with the inauguration of Richard Nixon, a ceremony that seemed to confirm for many of us the finality of a change in our national mood and ratify the results of a downward spiral that had begun with the assassination of President Kennedy five years, two months, and two days earlier. 

Throughout our four years at Harvard the nation's spirits steadily sank. The race riot in Watts was fresh in our minds when we registered as freshmen. Though our hopes were briefly raised by the passage of civil rights legislation and the promise of a war on poverty, the war in Vietnam grew steadily more ominous and consumed the resources that were needed to make good on the extravagant promises for dramatic progress here at home. The year before our graduation, our hopes were once again briefly raised by the political insurgency we helped inspire and that we hoped might somehow end our national nightmare. Then, months later, those hopes were cruelly crushed by the assassinations of Martin Luther King, Jr., renewed race riots --this time nationwide -- and then the assassination of Robert Kennedy, and what seemed like the death of any hope that we might find our way back to the entrance of the dark tunnel into which our country had wandered. 

All of this cast a shadow over each of our personal futures. My personal attitudes toward the career I have chosen changed dramatically during that time. I left Harvard in 1969 disillusioned by what I saw happening in our country and certain of only one thing about my future: I would never, ever go into politics. After returning from Vietnam and after seven years as a journalist, I rekindled my interest in public service. Yet I believe the same disillusioning forces that for a time drove me away from politics have continued for the country as a whole. After all, the war raged on for five more years and the downward spiral in our national mood reached a new low when the Watergate scandal led to the growing belief that our government was telling lies to our people. The resignation of President Nixon, his subsequent pardon, the Oil shocks, 21% interest rates, hostages held seemingly interminably and then swapped in return for weapons provided to terrorists who called us "the Great Satan", a quadrupling of our national debt in only a dozen years, a growing gap between rich and poor, and steadily declining real incomes -- all of these continued an avalanche of negative self-images which have profoundly changed the way Americans view their government. 

A recent analysis of public opinion polling data covering the years since my class came to Harvard demonstrates the cumulative change in our national mood. When my class entered as freshmen in the fall of 1965, the percentage of people who believed that government generally tries to do the right thing was over 60%. Today it is only 10%. The percentage believing that government favors the rich and the powerful was then 29%. Today it is 80%. And it is important to note that these trends hold true for Democrats and Republicans, conservatives and liberals. In fact, this may be an apocraphyl story, but someone actually claimed the other day the situation has gotten so bad that when they conducted a new poll and asked people about their current level of cynicism, 18% said they were more cynical than five years ago, 9% thought they were less cynical, and 72% suspected the question was some kind of government ploy, and refused to answer. 

Democracy stands or falls on a mutual trust -- government's trust of the people and the people's trust of the governments they elect. And yet at the same time democratic culture and politics have always existed in a strange blend of credulity and skepticism. Indeed, a certain degree of enduring skepticism about human nature lies at the foundation of our representative democracy. James Madison argued successfully in the Federalist Papers that the United States Constitution should create a protective balance of power among the factions that were bound to rise in any society. Democracy did not mean unity in the body politic. People do have reasonable differences. Human ignorance, pride, and selfishness would always be with us, prompting inevitable divisions and conflicting ambitions. Yet, freedom and order could be protected with safeguards insuring that no one branch of government and no one group or faction would be able to dictate to all the rest. 

We were the first large republic to build a nation on the revolutionary premise that the people are sovereign and that the freedom to dispute, debate, disagree and quarrel with each other created a fervent love of country that could hold us together against the world. It is still a revolutionary premise. And it is still built on a skeptical view of human nature that refuses to believe in perfection in intellect, logic, knowledge, or morals in any human being. And so the ceaseless American yearning for the ideal life has always stumbled uneasily over a persistent American skepticism about the parties and leaders who claim to have the wisdom and ability to guide us to our destiny. We revere our institutions, and at the same time we watch our leaders as though we were hawks circling overhead, eager to dive with claws extended onto any flaw or failure that we see. 

Even our most beloved president, George Washington, wrote in his last letter to Thomas Jefferson, on July 6, 1796: "I had no conception...that every act of my administration would be such exaggerated form and indecent terms as could scarcely be applied to a Nero, a notorious defaulter or even a common pickpocket." Our feelings about ourselves as a people are mixed. We Americans have often been proud to the point of cocky arrogance. But we have never been able to hide indefinitely from what we do wrong. Our failures eat at our conscience, and our sins itch under the showy garb of our achievements and prevent us from being complacent. Faith in the future, and skepticism about every person or group who offers to lead us there. 

These conflicting forces work together to shape the American character. And yet these forces must remain in a rough balance of emotional power. If we receive too heavy a dose of concentrated self-doubt and too many repetitive injuries to our confidence in self-government, then our normal healthy skepticism can fall into a mire of cynicism and we start to question the ability of any human community to live up to the democratic ideals that we proclaim. Once it is widely accepted, cynicism -- the stubborn, unwavering disbelief in the possibility of good -- can become a malignant habit in democracy. 

The skeptic may finally be persuaded by the facts, but the cynic never, for he is so deeply invested in the conviction that virtue cannot prevail over the deep and essential evil in all things and all people. The last time public cynicism sank to its present depth may have been exactly 100 years ago, when Mark Twain said, "There is no distinctly native American criminal class except Congress." That was a time when Americans felt the earth moving under their feet. Debt and depression forced farmers off the land and into cities that they found cold and strange and into factories where human beings became scarcely more than the extensions of machines. Cynicism was soon abroad in the land. 

We are now in the midst of another historic and unsettling economic transformation. Now the information revolution is leading to a loss of jobs in many factories, as computers and automation replace human labor. After World War II, 35% of America's employment was on the factory floor. 

Today fewer than 17% of our labor force works in manufacturing. Just as most of those who lost their jobs on the farm a hundred years ago eventually found new work in factories, so today new jobs are opening up in new occupations created by the information revolution -- but this time the transition is taking place more swiftly and the economic adjustment is, for many, more difficult and disorienting. In this respect we are actually doing better than most other nations. 

Every industrial society in the world is having enormous difficulty in creating a sufficient number of new jobs --even when their economies heat up. So, not surprisingly, public cynicism about leadership has soared in almost every industrial country in the world. History is a precarious source of lessons. Nevertheless, I am reminded that similar serious economic problems prevailed in Athens in the 4th century B.C., when the philosophical school we now know as Cynicism was born. 

The Cynics were fed up with their society and its social conventions and wanted everybody to know it. The root of the word "cynic" is the same as the Greek word for "dog," and some scholars say the Cynics got their name because they barked at society. Sounds almost like some of our talk radio shows. In a time of social fragmentation, vulgarity becomes a way of life. To be shocking becomes more important -- and often more profitable -- than to be civil or creative or truly original. Given the vulgarity that fragmentation breeds, cynicism seems almost irresistible. Sometimes it even looks like a refuge of sanity, a rational response to a world seemingly driven by the fast hustle, the pseudo-event, the rage for sensationalism. In any event, cynicism represented then and represents now a secession from society, a dissolution of the bonds between people and families and communities, an indifference to the fate of anything or anyone beyond the self. Cynicism is deadly. It bites everything it can reach -- like a dog with a foot caught in a trap. And then it devours itself. It drains us of the will to improve; it diminishes our public spirit; it saps our inventiveness; it withers our souls. 

Cynics often see themselves as merely being world-weary. There is no new thing under the sun, the cynics say. They have not only seen everything; they have seen through everything. They claim that their weariness is wisdom. But it is usually merely posturing. Their weariness seems to be most effective when they consider the aspirations of those beneath them, who have neither power nor influence nor wealth. For these unfortunates, nothing can be done, the cynics declare. Hope for society as a whole is considered an affront to rationality; the notion that the individual has a responsibility for the community is considered a dangerous radicalism. And those who toil in quiet places and for little reward to lift up the fallen, to comfort the afflicted, and to protect the weak are regarded as fools. Ultimately, however, the life of a cynic is lonely and self-destructive. It is our human nature to make connections with other human beings. 

The gift of sympathy for one another is one of the most powerful sentiments we ever feel. If we do not have it, we are not human. Indeed it is so powerful that the cynic who denies it goes to war with himself. A few years ago Shelby Steele wrote about his pain as a child, when he was mistreated by a teacher who called him stupid. He said that the teacher's declaration created a terrible reality for him. If the teacher told him he was stupid, he thought he must be stupid. Let me quote what he says: "I mention this experience as an example of how one's innate capacity for insecurity is expanded and deepened, of how a disbelieving part of the self is brought to life and forever joined to the believing self. As children we are all wounded in some way and to some degree by the wild world we encounter. From these wounds a disbelieving anti-self is born, an internal antagonist and saboteur that embraces the world's negative view of us, that believes our wounds are justified by our own unworthiness, and that entrenches itself as a lifelong voice of doubt." 

I believe that in a similar way, our nation's attitude towards itself can be and is shaped by national experiences. For example, the heady and triumphant victories of 1944 enlarged our confidence and helped us build the postwar world. And by contrast, during the years when my class was here at Harvard, America's capacity for insecurity was expanded and deepened by wounds to our national confidence. For example, an unnamed classmate of mine said in today's Boston Globe, "I lost faith in the United States as a force for good in the world." We are still trying to heal those wounds burned into our body politic by assassinations, the Vietnam war, the riots, the cultural conflicts and by the terrible conviction that people sworn to uphold our Constitution were not telling us the truth. E.J. Dionne, recently wrote, "Just as the Civil War dominated American political life for decades after it ended, so is the cultural civil war of the 1960s, with all its tensions and contradictions, shaping our politics today. We are still trapped in the 1960s. The country still faces three major sets of questions, left over from the old cultural battles: civil rights and the full integration of blacks into the country's political and economic life; the revolution in values involving feminism and changed attitudes toward child-rearing and sexuality; and the ongoing debate over the meaning of the Vietnam War, which is less a fight over whether it was right to do battle in that Southeast Asian country than an argument over how Americans see their nation, its leaders, and its role in the world." 

Dionne also argues that both conservatives and upper middle-class liberals have -- for separate reasons -- kept this cultural civil war alive. Partly for this reason, our national political conversation has been dominated by increasingly mean-spirited efforts to attack our leaders' motives, character and reputation. As the public's willingness to believe the worst increases -- that is to say -- as cynicism increases -- the only political messages that seem to affect the outcome of elections are those that seek to paint the opposition as a gang of bandits and fools who couldn't be trusted to pour water out of a boot if the directions were written on the heel. 

This fixation on character assassination rather than on defining issues feeds the voracious appetite of tabloid journalism for scandal. And now wets the growing appetite of other journalistic organizations for the same sort of fare. A few years ago, the Czech leader Vaclav Havel wrote these prescient words, "They say a nation has the politicians it deserves. In some sense that is true: Politicians are truly a mirror of the society and a kind of embodiment of its potential. At the same time, paradoxically, the opposite is also true. Society is a mirror of its politicians. It is largely up to the politicians which social forces they choose to liberate and which they choose to suppress, whether they choose to rely on the good in each citizen, or on the bad." But it is crucial for us, especially those of us in public service, to understand that cynicism also can arise when political leaders cavalierly promise to do good things and then fail to deliver. 

The inability to redeem glib and reckless promises about issues like education, race relations, and crime can add to the disturbing and growing doubts among the American people about our ability to shape our destiny. Over the long haul sustainable hope is as important to the health of self-government as sustainable development is for ecological health. Dashed hopes poison our political will just as surely as chemical waste can poison drinking water aquifers deep in the ground. When hopes are repeatedly dashed and a nation's instinct for self- government is repeatedly injured, national cohesion can dissipate. 

The results are for all to see. At home and abroad the weakening of bonds between the individual and the larger society creates a vacuum quickly filled by other group identities--based on race, or clan, or sect, or tribe, or gang. Some distinguishing quality, often physical, is used to demarcate group identity. These differences become standards raised to summon the group to war against others slightly different from themselves. It is one of the strange perversities of this process that the smaller the difference, the more ferocious the hatred and the more hideous the massacres that follow. 

Look at our bleeding world! Hutus versus Tutsis, Bosnian Serbs versus Bosnian Croats and Bosnian Muslims, all of whom seem often to others indistinguishable, but who themselves are driven to mindless ferocity by what Freud called "the narcissism of slight difference," what St. Augustine called pride, the mother of all sins, and about which William Butler Yeats said in a famous poem: "Things fall apart, the centre cannot hold; Mere anarchy is loosed upon the world, The blood-dimmed tide is loosed, and everywhere The ceremony of innocence is drowned; The best lack all conviction, while the wors t Are full of passionate intensity." 

Make no mistake: just as repeated injuries to our national esteem can seriously jeopardize our ability to solve the problems which confront us, so the convergence of too much chaos and horror in the world -- of too many Bosnias and Rwandas -- can seriously damage the ability of our global civilization to get a grip on the essential task of righting itself and regaining a measure of control over our destiny as a species. Where then do we search for healing? What is our strategy for reconciliation with our future and where is our vision for sustainable hope? I have come to believe that our healing can be found in our relationships to one another and in a shared commitment to higher purposes in the face of adversity. 

At the 1992 Democratic Convention, I talked about a personal event that fundamentally changed the way I viewed the world: an accident that almost killed our son. I will not repeat the story here today except to say that the most important lesson for me was that people I didn't even know reached out to me and to my family to lift us up in their hearts and in their prayers with compassion of such intensity that I felt it as a palpable force, a healing reaching out of those multitudes of caring souls and falling on us like a mantle of divine grace. Since then I have dwelled on our connections to one another and on the fact that as human beings, we are astonishingly similar in the most important parts of our existence. I don't know what barriers in my soul had prevented me from understanding emotionally that basic connection to others until after they reached out to me in the dark of my family's sorrow. But I suppose it was a form of cynicism on my part. If cynicism is based on alienation and fragmentation, I believe that the brokenness that separates the cynic from others is the outward sign of an inner division between the head and the heart. There is something icily and unnaturally intellectual about the cynic. This isolation of intellect from feelings and emotions is the essence of his condition. For the cynic, feelings are as easily separated from the reality others see as ethics are separated from behavior, and as life is cut off from any higher purpose. Having felt their power in my own life, I believe that sympathy and compassion are revolutionary forces in the world at large and that they are working now. 

A year after the accident, when our family's healing process was far advanced, I awoke early one Sunday morning in 1990, turned on the television set and watched in amazement as another healing process began, when Nelson Mandela was released from prison. Last month, I attended his inauguration when he was sworn as President of the new South Africa in what was a stupendous defeat for cynicism in our time. Many were moved to tears as he introduced three men who had come as his personal guests -- three of his former jailers -- and described how they had reached across the chasm that had separated them as human beings and had become personal friends. 

Nine months ago, I witnessed the healing power of a handshake on the South Lawn of the White House as Yitzhak Rabin and Yassir Arafat began the tentative process of reconciliation and peace in a relationship hitherto characterized by only hatred and war. Less than five years ago, the world watched in amazement as the Berlin Wall was dismantled and statues of dictators were toppled throughout East and Central Europe and as authoritarian communist governments were replaced by market democracies alert to the needs of their people. Less than three weeks ago, for the first time in almost fifty years, nuclear missiles were no longer targeted on American cities -- a small but important step in the continuing reversal of the nuclear arms race that long served as the cynics' ace in the hole. 

There is, in other words, a respectable argument that the cynics who are barking so loudly are simply wrong. For my part, in the 25 years since my Harvard graduation, I have come to believe in hope over despair, striving over resignation, faith over cynicism. I believe in the power of knowledge to make the world a better place. Cynics may say: Human beings have never learned anything from history. All that is truly useful about knowledge is that it can provide you with advantages over the pack. But the cynics are wrong: we have the capacity to learn from our mistakes and transcend our past. Indeed, in this very place we have been taught that truth -- Veritas -- can set us free. I believe in finding fulfillment in family, for the family is the true center of a meaningful life. 

Cynics may say: All families are confining and ultimately dysfunctional. The very idea of family is outdated and unworkable. But the cynics are wrong: it is in our families that we learn to love. I believe in serving God and trying to understand and obey God's will for our lives. Cynics may wave the idea away, saying God is a myth, useful in providing comfort to the ignorant and in keeping them obedient. I know in my heart -- beyond all arguing and beyond any doubt -- that the cynics are wrong. I believe in working to achieve social justice and freedom for all. Cynics may scorn this notion as naive, claiming that all our efforts for equal opportunity, for justice, for freedom have created only a wasteland of failed hopes. But the cynics are wrong: freedom is our destiny; justice is our guide; we shall overcome. I believe in protecting the Earth's environment against an unprecedented onslaught. 

Cynics may laugh out loud and say there is no utility in a stand of thousand year old trees, a fresh breeze, or a mountain stream. But the cynics are wrong: we are part of God's earth not separate from it. I believe in you. Each of you individually. And all of you here as a group. The cynics say you are motivated principally by greed and that ultimately you will care for nothing other than yourselves. But the cynics are wrong. You care about each other, you cherish freedom, you treasure justice, you seek truth. And finally, I believe in America. Cynics will say we have lost our way, that the American century is at its end. But the cynics are wrong. America is still the model to which the world aspires. Almost everywhere in the world the values that the United States has proclaimed, defended, and tried to live are now rising. In the end, we face a fundamental choice: cynicism or faith. Each equally capable of taking root in our souls and shaping our lives as self-fulfilling prophecies. We must open our hearts to one another and build on all the vast and creative possibilities of America. This is a task for a confident people which is what we have been throughout our history and what we still are now in our deepest character. I believe in our future.