Memo to the FBI: Expand the Probe of Economic Crimes
We Need a Special Prosecutor and a Democratic Party That ‘Gets It’
After dragging its G-Man heels for years, someone at the FBI has woken up and realized that laws have been broken by the financial industry. Those violations are part of what led to the economic abyss we are facing. The ever - vigilant bureau that blew its 911 probe has just announced an investigation of 14 unnamed mortgage companies involved in a variety of scams. Talk about going after small fish.
In this week of football mania, what we know and they have yet to learn, is that if you dig deeply, you will soon be playing in a Superbowl of corporate criminal complicity.
We need a special prosecutor, and some zealous investigators who know something about white-collar crime waves. One suggestion: bring back former veteran FBI agent turned whistleblower Christine Rowley, a recent TIME Magazine “Person of the Year,” to head the taskforce. Rowley told me she used to work cases like this with the former Rudolph Giuliani who once made a name for himself as the scourge of Wall Street crime families. (Maybe it takes someone with a Mafia patrimony to know how to smell the scammers and then use RICO anti-conspiracy laws to put them behind bars.) That was before Rudy decided to join another mob-the Homeland Security fearmongers to cash in on 911.
Today’s financial racketeers span the globe, and are not confined to a solo junior trader at a French bank who lost over $7 Billion on trades. He was driven, he says, to make a big bonus and with, he adds, the knowledge of all his overlords who now feign great shock-SHOCK!-about what he, and in their view, he alone, did. There are even news organizations in Europe who believe that the whole global financial crisis was the work of one bad man. This sounds like a replay of the “lone assassin” theory that always pops up after high profile killings.
To its shame, our media has once again not been in the lead on this vital story. It is still not framing it in criminal terms. It is not investigating the role of institutions working together-big banks, hedge funds, rating agencies, and the securities industry — making superprofits with deceptive subprime transactions. That is, before their securitized schemes blew up in their faces causing super-lossses and the writedowns of billions.
That, in turn, contributed to a larger economic meltdown that may go beyond being a mere “recession.” The press seems to have no “institutional memory” about past crashes and Enronesque scandals, or the way greed and unlawful activity regularly makes for so much misery because it is the people who can least afford it who always suffer the most. Pundits are better at doing post-mortems than insuring accountability with hard-digging watchdog journalism.
So where’s the editorial outrage, where are the calls for the prosecutions of the fraudsters? As Pam Martens explains on Counterpunch, “Mainstream media has also been implanting the idea that it’s all about homeowners and mortgage loans instead of banksters hiding bad debt.” So there is a trust issue with media as well as the financial overlords. Forbes admits: “This predicament of trust ceased to be a subprime crisis long ago. We face a global credit crisis…”
Mike Whitney puts the problem in a nut shell: “The financial system has been handed over to scam-artists and fraudsters who’ve created a multi-trillion dollar inverted pyramid of shaky, hyper-inflated, subprime slop that they’ve sold around the world with the tacit support of the ratings agencies and the US political establishment.”
Understand the relationship here. Policymakers addicted to right-wing ideology allowed this crisis. A lack of oversight and regulation enabled. Full Stop! No wonder the bankers meeting in Davos at the World Economic Forum are blaming the Bush White House and its so-called “free market” economic policies for bringing down the “free market.”
The decisions of the Federal Reserve Bank-which was warned about a predatory lending disaster and did nothing-was a big part of the problem and its latest round of rate cuts is likely to make matters worse as inflation rises and the people who need help the most don’t get it.
This underscores the old truth that the “masters of the universe” recognize. As much as they protest restraints on their unscupulous endeavors, they know that regulations and rules in the marketplace are needed to keep them from killing each other off. Without oversight, in the words of the poet, “the centre does not hold” and “things fall apart.”
Of course, finger-pointing bankers rarely blame themselves for anything, even now as they dissemble and downplay their losses while laying off thousands of employees adding to the unemployment lines. Almost every big brand name bank has been complicit in a subcrime scheme.
Many of the smartest minds in finance are worried that this train wreck can’t be stopped. George Soros calls it the worst crisis in 60 years and fears worse to come. Writers are even invoking the worries of top conservative economists like Ludwig von Mises who said: “There is no means of avoiding the final collapse of a boom brought on by credit expansion. The question is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.”
“Total Catastrophe?” Yikes.
And what about the politicians? Most have been silent while still taking donations from the FIRE combine. FIRE stands for the three industries funding much of our politics, Finance, Insurance and Real Estate. They are now trying to put out a financial wildfire with a pathetic bucket brigade in the name of economic “stimulus.”
To do “something,” the Democrats in the House have passed a measure that everyone knows is a joke, And what they are doing is going along once again with Bushevik policies to reward the greedy and those with the least pain.
What’s left of the left, or “progressive” world is also largely silent as if economic justice has not always been at the center of the fight for a better world. There has been little direct action to stop massive foreclosures with blockades at home auctions or campaigns for debt relief?
Why can’t the next big anti-war march in March on the 5th anniversary of the Iraq attack not broadens its focus to include the way war spending has contributed to the economic decline, and that, condemn the the media for boostering the occupation, and awaken a new fight for economic change to challenge all the candidates and Wall Street.
And to return to the Fee Bee Eye: You want to see real terror and homeland insecurity? Visit any town and most homes in this country as the economic sqeeeze made worse by high gas and food prices tightens its grip on the dreams and hopes of Americans of all ages, colors and classes. As the larger bill comes due, many of us can barely pay our endless loans and credit card bills.
Raids on Wall Street firms and a serious global investigation can’t solve the deeper problem, but it sure would be a good start.
News Dissector Danny Schechter wrote SQUEEZED, an e-book chronicling the crisis and calling for better media coverage. He is also “blogger-in chief” of Mediachannel.org, His new film is IN DEBT WE TRUST: America Before the Bubble Burst (Indebtwetrust.com) Comments to Dissector@mediachannel.org
That’s why the War on Terra has been such a joke. If Bush & Co. were genuinely interested in defending the US, they’d start by defending our economy. Quite the reverse seems to have occurred. Whose side are they really on? The Cayman Islands and Dubai are clues.
“A lack of oversight and regulation enabled.” Hmm… sounds a lot like what happened before the Depression.
Excellent article. As usual, I want to focus on: “What’s left of the left, or “progressive” world is also largely silent as if economic justice has not always been at the center of the fight for a better world.”
This is one of the few progressive sites that really looks at it from this angle. That’s why so many in CDs discussion forum keep dropping Ron Paul’s name. Despite all the nasty things that can be said about the man, he’s the only one in the spotlight pleading with America to recognize this and to do something about it. Well, that and all that anti-war vitriol he spouts is quality stuff as well.
You needn’t be afraid to support him. He’ll never be the candidate, and if he is, he’ll never win. His views are far too incompatible with the establishment. Heck, you even help him out if you rant and rave about what what a looney he is, all that internet content counts as relevence capital in some wierd calculations somewhere.
Any other prez possibilities tackling this?
re claudius 12:41pm
exactly. and what was one of the top priorities of the bush crime family, the heart’s desire of the filthy rich? to repeal glass-steagal and other reform measures enacted in the wake of the great depression.
also note that the list of democrats in opposition to this retreat was woefully short. could one of cd’s resident apologists for the dems offer an explanation? we all need a good laugh right about now.
Yeah, here’s the punchline for the “good laugh.” You either elect Obama or Hillary, or you get McCain to push wars for years to come or Romney to push his beloved Wall Street for years to come.
Daniel, I seen lotsa folks here picking on you for painting such a rosy picture of your favourite party. Yet in the face of this massive crime wave, the rosiest picture you can paint of them was that gloomy little tidbit? Yikes.
Big Money,
I don’t have time or inclination to “paint pictures” for cynics to laugh at. And some CD regulars would never be satisfied anyway. We’re down to crunch time and the reality is the four candidates we have. What’s the “good laugh” stuff about?
obama’s going to take on wall street? hillary’s going to declare peace?
HAHAHAHAHAHAHAHAAHAAHA!!!!
thanks, i needed that!
Daniel,
When a black and white world forces you to choose between black and dark dark grey, as though you are consenting to it, a laugh is the best medicine.
The Dream, the Common one, I think, is to seek out an option that’s a more acceptable shade. Laughs are the watering holes along the way.
I like laughs as well as anyone. But I prefer something funny. The kind two posts up is not. But for those who need a respite from reality, your guy Nader is at it again. Maybe that will keep some entertained before it hands another election to yet another Republican.
Ah, yes, Nader. Getting airplay in major media for real, important issues. Pretty shallow entertainment, indeed. He could easily win by getting only the votes of those who would not vote for either major party - a HUGE group of people. Now that would be entertainment! There is nothing built into the system to rule this out. It’s not built to be two-party, it evolved that way.
Anyway, for laughs, here’s something I find really theraputic - visit this parody site - http://www.whitehouse.org/ - for a few minutes, and then read some actual right-leaning sites that aren’t parodies. It’s a spooky sensation.
Daniel, I read this again, and I apologize if my “yikes” came across as a judgement on your funniness or something - It was an expression of fear on account of one of the biggest defenders hasn’t a defense ready on this important point.
I believe strongly in the importance of this Ludwig von Mises thing: “There is no means of avoiding the final collapse of a boom brought on by credit expansion. The question is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.” That and all that it implies needs to be talked about, needs to be dealt with. Who’s gonna deal with it?
This page is mighty quiet, as these forums go.
So, now the G-men are looking for where the bodies are buried.
But while they look in corporate trash bins, and while the American rubes are distracted by ’stimulating’ dreams, the bodies of CDOs and SIVs are being moved from hidden private corporate mausoleums to Arlington National —- where funerals will have all the public pomp and cost that this nation always pays to war heroes.
Perhaps Bob Dylan’s old song will be revived as a funeral dirge — sung by Freddy Mac, and backed by the retired Glass-Steagall band:
Take a load off Fanny
Take a load for free
Take a load off Fanny
And (and) (and) you can put the load right on me
Who knew, when Grover Norquist infamously threatened that he wanted to shrink government “down to the size where we can drown it in the bathtub”, that the bathtub would also explode right under Uncle Sam’s scrot.. um, er, ‘family jewels’ with planted ‘debt bombs’?
Yes, when this is all over they will have to rename the Great Depression simply that old 1930’s recession.
The SEC, FASB, Treasury and every manner of crook is trying to allow more ‘flexibility’ in hiding the bodies.
But the bodies are simply too numerous and keep rising to the surface like corpses in a Katrina-flooded New Orleans cemetery.
Ultimately the massive number of bodies of CDOs and SIVs have to be processed through the efficient and corrupt government itself — like a financial Holocaust.
The corporatist Empire hiding behind the facade of this ‘Vichy America’ should be equal to the task, by spreading the death and socializing the guilt throughout the public sector — starting with Freddie Mac and Fannie Mae.
Perhaps gutting the supposedly ‘antiquated’ Glass-Steagall banking regulations against financial gang-rape was a bit premature?
Do ya think?
Well, at least disabling the regulatory apparatus of the nation’s economy back to 1929 standards will get us ready for GD II (Great Depression two)
Master has decided: THESE ARE YOUR CANDIDATES. THESE ARE THE OVERSEERS FOR YOUR CONSIDERATION. No go to polls and VOTE your conscience for the choices that WE have selected for you. YOU WILL OBEY.
As Daniel David says in the classic Dem mantra they stole from Maggie T: TINA, There Is No Alternative. The Dems love to limit your choices just like Master does. Makes it easier for them to FUCK US.
No ISSUES will be allowed to interefere with our political Ken & Barbie Show and of course all the candidates will continue to transfer the wealth of America to Master until it’s gone. That’s their JOB.
You may take A small consolation, within a year or two, we may all be saying, “The Former United States of America.”
And that’s the good news.
Pieces of 8.
“Understand the relationship here. Policymakers addicted to right-wing ideology allowed this crisis.”
The good news is: The new head of the Bank of International Settlements (BIS) is calling on global governments to get their “fiscal” policies in order, beginning with over-the-counter-derivatives.
If the G7 wakes up to reality, a global meltdown could be avoided.
http://www.financialsense.com/editorials/guild/2008/0202.html