Laundering the rule of law
By Mike Krauss
Bucks County Courier Times
The Wall Street bail-out was sold as one time, emergency relief to save Wall Street and rescue the American economy from collapse. Ransom paid, the economy collapsed; but the bail out continues as a never ending, multi-trillion dollar give away.
Now we know that many, if not all the largest banks were engaged in a decades long criminal enterprise, knowingly embraced by their officers, who even the capitalist cheering publication The Economist headlined as “Banksters.”
Bottom-to-top fraud in the mortgage industry. Compromised ratings agencies that gave AAA grades to junk investments. Rigged U.S. municipal bond markets, rigged international interest rates and interest rate swaps that cost borrowers, consumers, school boards and municipalities billions, maybe trillions of dollars.
Most recently revealed is a decade long, systematic laundering of billions of dollars of cash from Mexican and Columbian drug lords and clients with links to terrorist suspects.
The U.S. government has responded with nothing more than a few well publicized investigations and fines that are little more than chump change to the fabulously wealthy banksters.
No criminal prosecutions of the high level individuals responsible for actions that have devastated the lives of tens of millions of Americans and eaten up trillions of dollars of their former wealth: lost jobs, lost homes, lost savings, lost investments, lost futures and lost lives.
While the administration and Federal Reserve provide damage control and mountains of cash to the banksters in what has become a never-ending bailout, they feed propaganda to the American people.
“Let them eat headlines.”
The failure of the U.S. Attorney General to bring criminal charges against the individual banksters for their criminal conduct is a shameful betrayal of justice.
There is a lot of shame to go around.
Instead of duty to their oaths of office and subpoenas from the Senate and House committees which have oversight of the Justice Department, the American people get – silence.
Instead of a daily, coast to coast barrage of outraged editorials, demanding the firing of the U.S. Attorney General, the people get – silence.
Instead of a chorus of righteous support for the rule of law from the dean of every law school, district attorney and prosecutor in the nation, we get – silence.
It is shameful, and it is dangerous.
The rule of law is central to the survival of any civilized nation. Without it, there is only the amoral government of the predators and the slow decline to tyranny and ruin.
The decline may not be so slow.
One result of the on-going bail out of the banksters is, of course, that their mega banks keep getting bigger and more dangerous.
Writing a few days ago in Rolling Stone, Matt Taibbi noted that nine largest banks now control a reported 75 percent of the assets in the American banking system, nearly $11.5 trillion; up from about 48 percent and $8.5 trillion only a few years ago - 9 banks out of more than 7,000.
Taibbi noted that the six largest U.S. banks now have a combined 14,420 subsidiaries, placing them effectively beyond regulation. He cited a recent study by the Kansas City Fed, which calculated that it would take 70,000 examiners to inspect these banks “with the same level of attention normally given to a community bank.”
And what is the result of the near impossibility of effective regulation? Business as usual on Wall Street. Very bad business, which Taibbi describes as a “dangerous shift in banking behaviour.”
He writes: “With an apparently endless stream of free or almost-free money available to banks - coupled with a well-founded feeling among bankers that the government will back them up if anything goes wrong - banks have made a dramatic move into riskier and more speculative investments, including everything from high-risk corporate bonds to mortgage backed securities [Again!] to payday loans, the sleaziest and most disreputable end of the financial system. In 2011, banks increased their investments in junk-rated companies by 74 percent.”
The bail out and failure to prosecute – to hold the banksters accountable – is not only subverting the rule of law and destroying the trust of the people in their elected representatives – the trust which is essential for the survival of democracy – it has put the U.S. banking system right back where it was before the last crash and headed for another.
Is there any way to avoid this fate?
Firing the U.S. Attorney general is the first step. Breaking up the big banks is a second. Creating a public banking system to support local banks and local economies, its actions fully transparent and its officers fully accountable to the people, is a third. De-authorizing the Federal Reserve and taking it into the U.S. Treasury as a much scaled-down advisory body on interest rates and money supply is a forth.
This last action should include replacing Federal Reserve notes, erroneously referred to as “the U.S. dollar,” with actual U.S. dollars issued by the U.S. Treasury, without the interest paid to the bankster owners of the Fed.
Of these measures, only the creation of public banks does not require an action of the administration or Congress and can be undertaken by the people locally, and is therefore the one to pursue now.
Mike Krauss is a former officer of PA county and state government and chairman of the Pennsylvania Project. www.papublicbankproject.org Email: firstname.lastname@example.org