Will the Wall Street Banksters Ever Be Held Accountable?

Director, Plunder The Crime
of Our Time

We are all still stuck in the
"big Muddy." No, not the wars of old or even the oil disaster.
The mud I am referring to is more like quicksand and it sucks anyone
who wants to look at what happened in the financial crisis deeper and
deeper into it.

Soon, you are buried in shifting
sea of so-called "exotic financial instruments," and tranches, derivatives,
credit default swaps, naked short-selling, etc and so forth, ad fin
item. It's murkier in there than in the oil-infested waters
of the Gulf of Mexico.

Stop, my head hurts.

A far simpler explanation,
pervasive fraud and financial crime, has been ignored by most of our
economic geniuses. As I made my film Plunder The Crime of Our Time offering
a "crime narrative," I ran up against the denial that greeted my
2006 film In Debt We Trust warning of a meltdown. Then I was called,
a "doom and gloomer." Now I have just been ignored or considered
simplistic.

Why is that? There are cultural
and ideological reasons. The world of finance is dominated by the elite
of the elite, up-right citizens all, including many philanthropists
and patrons of the arts. How could such important "big men" ever
be accused of slimy crimes?

James K. Galbraith, an economist
and the son of John Kenneth Galbraith, the late and great economist
who argued that "corporate larceny" was behind the crash of
'29, (I honor hin in the DVD of my film) believes that the economics
profession, the "experts" who set the terms of the debate are partly
responsible. He shared his views in recent Congressional testimony.

"I write to you from
a disgraced profession. Economic theory, as widely taught since
the 1980s, failed miserably to understand the forces behind the financial
crisis. Concepts including "rational expectations," "market
discipline," and the "efficient markets hypothesis" led
economists to argue that speculation would stabilize prices, that sellers
would act to protect their reputations, that caveat emptor could be
relied on, and that widespread fraud therefore could not occur. Not
all economists believed this - but most did.

Thus the study of financial
fraud received little attention. Practically no research institutes
exist; collaboration between economists and criminologists is rare;
in the leading departments there are few specialists and very few students.
Economists have soft- pedaled the role of fraud in every crisis they
examined, including the Savings & Loan debacle, the Russian transition,
the Asian meltdown and the dot.com bubble. They continue to do so now.
At a conference sponsored by the Levy Economics Institute in New York
on April 17, the closest a former Under Secretary of the Treasury, Peter
Fisher, got to this question was to use the word "naughtiness."
This was on the day that the SEC charged Goldman Sachs with fraud."

What a world: people who steal
food are deemed criminals and sent away with long sentences in a prison
system with the highest rate of incarceration in the world. Banksters
are considered "naughty."

This may be changing, ever
so slowly, as a new era of investigations begins. The President has
created a new federal anti-financial fraud task force. Goldman
Sachs is being probed. So is Morgan Stanley. The Daily Beast reports
on NY Attorney General Andrew Cuomo's latest highly political legal
jihad:

"New York Attorney General
Andrew Cuomo is launching an investigation into eight banks to see whether
they misled rating agencies, The New York Times reports Thursday. The
agencies have been under attack since the financial crisis for over-rating
the quality of mortgage investments offered by the banks. Cuomo's new
inquiry suggests that he believes that error may be in part due to banks'
chicanery. The A.G. is targeting Goldman Sachs, Morgan Stanley, UBS,
Citigroup, Credit Suisse, Deutsche Bank, Credit Agricole, and Merrill
Lynch. It is a high-profile investigation for a politician who is said
to have his heart set on New York's governor's seat."

The problem here is that the
criminal enterprise we are up against is not just in finance where securities
laws only protect investors, but in real estate and insurance. The crimes
there were more pervasive and hurt more people. You need a sense of
how this whole system of corruption worked. This chart offers one sense
of it:

https://marcochacon.livejournal.com/732432.html

This is why prosecutors need
to use the RICO law aimed at conspiracies, not just lone wrong doers.
Sadly, many in the media, including progressives, prefer the top-ten
"list" approach used by magazines focusing on individuals not institutions.
This personalizes the problem focusing anger at bad people, not a system
gone amuck. Example: an excellent but limited list of bad guys
posted by AlterNet: on "America's Ten Most Corrupt Capitalists"

https://www.alternet.org/news/146819

Overseas, in Greece and England,
and other parts of Europe, there's been an indictment of American
corporate predators, especially Goldman Sachs. They are being denounced
as "financial terrorists" and discussed in terms of their links
to various elite business formations like the Bilderberg Group. While
unions say workers are being targeted in an economic war, the left also
sees a counterrevolution underway against democracy with power moving
firmly into the hands of bond traders and markets demanding austerity,
not people's Parliaments and elected politicians. European leaders
say they are at war, too, against "speculators"

Surprisingly, there are voices
on the right also speaking out. Cliff Kincaid of Accuracy in Media,
an ultra conservative organization now fears that "Hedge Funds Spark
World Revolution," writing:

"The Marxists used to be
the experts in exploiting human suffering for the purposes of sparking
revolution. But the hedge funds are doing better than the Marxists.

Consider that the business
publication Barron's has an article headlined on its cover, "A
savvy hedge-fund manager reveals how to make money on Old World's woes."
A better headline would have been "How to exploit human suffering."
At a time when people are dying in Greece because of riots in response
to economic problems, what kind of publication would openly advertise
how to make money at the expense of others and profit from their misery?

But this is how the hedge fund
short sellers and their apologists work."

Even as the banks push back
against financial reform, watering down legislation against derivatives,
too big to fail banks and even a full audit of the Federal Reserve Bank,
the crisis lurches out of control. The NY Times reports that many jobs
are not coming back, and debt is on the rise to historic levels. The
next crash will be worst.

The Banksters need to be stopped,
but only the people can do that-our media and politicians, right center
and progressive, are not up to the task. What we need is more than exposes
but a major effort to organize like foroureconomy.org. This is the only
way to fight back against a one-sided war.