Saturday, February 19, 2011

Why isn't Wall Street in jail?

Building on the Alan Grayson thread, the brilliant Rolling Stone investigative reporter Matt Taibbi has done it again with an article by the above name. The US government is complicit in Wall Street's crimes. The worst financial crimes in the history of the world and not one prosecution. Well, Bernie Madoff was prosecuted but he had nothing to do with creating the crisis; he was just a bit player in doing what was created for him by the banks and government. Those banks “were directly involved in elaborate fraud and theft.”

So what punishment did they get? Ridiculously small fines by comparison to the devastation they wrought and the money they made from it. It's like if I rob a bank for $1,000,000 and for punishment they say I have to give back $1,000. Great deal, I'm going to rob more banks. Only this time the banks are robbing the US citizens, since we bail them out for robbing us. Something is seriously wrong with this picture.

Taibbi explores the Fed agencies set up to police the financial industry. The agencies however do not have prosecutorial power so they must refer any wrongdoing to the Justice Department. The JD does not have the financial acumen to understand these white collar crimes so relies heavily on the Fed agencies for expertise and recommendations. But the regulators are in bed with the criminals so they bury the investigations in an isolated file somewhere in Area 51 so that the case goes nowhere. Or if the case is so egregious that it can't be buried they present it in such a way as to minimize the crime and the perp gets off with the relatively minor fines referenced above.

When an ethical yet obviously naive agency employee does try to do their job by properly investigating a financial crime they are thwarted by their superiors. If they press on they are fired. Why does this happen. The top regulators look the other way and are rewarded with cush, lucrative jobs with the industry they are supposed to regulate upon leaving those positions. They get to witness first-hand the crimes and are lured into the criminal world by being bought off. Not to mention the graft they get under the table while still regulating.

So the criminal banks and insurance companies pay miniscule settlements from shareholder money, the individual executives-perpetrators face no criminal charges, the terms of said settlements require no admission of guilt, and the laws do not change to prevent future crimes of the same kind from happening again. So we really think we've seen the end of this? And will the next time finally destroy the entire financial system to the point of a world-wide depression for most of us? Who cares, the Kings of Wall Street and their government cronies will be living it up in the Bahamas when the time comes.

I fucking care! Read Taibbi's story for the full details. And get on the computer and write to your representatives. And perhaps we should even start to march in the streets to get some justice for these criminals? Just look at the public protests in Madison right now over an insane Republican governor trying to neuter union negotiating power. It seems Americans are finally learning from the middle east that us poor people have power in numbers and that we need to exercise it by active protest to gain world-wide attention. Otherwise we can sit at home and let the criminals destroy our lives.

Check out our discussion of this at the IPS thread.

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