What's up with Barack Obama? The candidate
for change once promised to take on the powerful banking interests but
is now doing their bidding. Finally, a leading Democrat, in this case
Senate Banking Committee Chairman Chris Dodd, has a good idea for
monitoring the Wall Street fat cats who all but destroyed the American
economy, and the Obama administration condemns it.
Today marks the 10-year anniversary of the passage of the repeal of the
1933 Glass-Steagall Act and related legislation. It is an anniversary
worth noting for what it teaches us about forestalling financial
crises, the consequences of maniacal deregulation, and the
out-of-control political power of the megafinancial institutions.
Reuters is out with an authoritative story
on finalists being considered for the Financial Crisis Inquiry
Commission, the investigative body created by Congress to launch a
full-scale investigation of the financial crisis in the spirit of the
famous early 1930s hearings led by Ferdinand Pecora.
Everyone wants the economy to bounce bank, and the President's not
wrong to believe that the way to revive things is to boost confidence.
But if mass confidence is what it's gong to take, the people at the
bottom of our economic pyramid need hope -- not only that they'll have
jobs again and homes to keep - but protection against mortgage crooks -
and restitution if they've been scammed.
The city of Baltimore is currently pursuing a suit against Wells Fargo.
How could Paul Krugman, winner of the
Nobel Prize in economics and author of generally excellent columns in
The New York Times, get it so wrong? His column last Sunday-"Reagan Did
It"-which stated that "the prime villains behind the mess we're in were
Reagan and his circle of advisers," is perverse in shifting blame from
the obvious villains closer at hand.
"This bill is the most important legislation for financial
institutions in the last 50 years. It provides a long-term solution for
troubled thrift institutions. ... All in all, I think we hit the
jackpot." So declared Ronald Reagan in 1982, as he signed the Garn-St.
Germain Depository Institutions Act.
"Regulate the health insurance giants," chanted the reformers.
"Stop denying coverage to sick people," they demanded. "Stop jacking
up premiums," they cried. "Health coverage for all," they bellowed.
It was an impressive show that the health care reform movement put
on last week at a hearing before the Senate finance committee. It was
especially impressive because those doing the chanting, demanding,
crying and bellowing were not aggrieved outsiders, but the ultimate
insiders - the health insurance giants themselves!
Last week, the House Committee on Oversight and Government Reform approved a bill to provide paid parental leave to federal workers and thus make government employment more attractive. The committee's ranking Republican, Rep. Darrell Issa of California, reportedly opposed the measure because he fears, among other things, that rascally federal workers will scam the system, piling up child after child just to claim the four weeks of paid leave.
They "could have one adoption or one foster child per year, resulting in every year you get a new foster child," Mr.
"Everything predicted by the enemies of banks, in the beginning, is now coming to pass. We are to be ruined now by the deluge of bank paper. It is cruel that such revolutions in private fortunes should be at the mercy of avaricious adventurers, who, instead of employing their capital, if any they have, in manufactures, commerce, and other useful pursuits, make it an instrument to burden all the interchanges of property with their swindling profits, profits which are the price of no useful industry of theirs."
Last week columnist David Brooks of the New York Times published an op-ed setting
out two explanatory narratives of our current economic crisis, which he
dubbed the "greed narrative" and the "stupidity narrative." Brooks
describes the greed narrative (as detailed in Simon Johnson's Atlantic piece "The Quiet Coup"
as an explanation of how the growing political power of Wall Street
e
