Showing posts with label revolving door. Show all posts
Showing posts with label revolving door. Show all posts

11 March 2019

Regulatory Capture: The Banks and the System That They Have Corrupted


"But the impotence one feels today— an impotence we should never consider permanent— does not excuse one from remaining true to oneself, nor does it excuse capitulation to the enemy, what ever mask he may wear.  Not the one facing us across the frontier or the battle lines, which is not so much our enemy as our brothers’ enemy, but the one that calls itself our protector and makes us its slaves.  The worst betrayal will always be to subordinate ourselves to this Apparatus, and to trample underfoot, in its service, all human values in ourselves and in others."

Simone Weil


"And in some ways, it creates this false illusion that there are people out there looking out for the interest of taxpayers, the checks and balances that are built into the system are operational, when in fact they're not.  And what you're going to see and what we are seeing is it'll be a breakdown of those governmental institutions.  And you'll see governments that continue to have policies that feed the interests of -- and I don't want to get clichéd, but the one percent or the .1 percent -- to the detriment of everyone else...

If TARP saved our financial system from driving off a cliff back in 2008, absent meaningful reform, we are still driving on the same winding mountain road, but this time in a faster car... I think it's inevitable. I mean, I don't think how you can look at all the incentives that were in place going up to 2008 and see that in many ways they've only gotten worse and come to any other conclusion."

Neil Barofsky


"Written by Carmen Segarra, the petite lawyer turned bank examiner turned whistleblower turned one-woman swat team, the 340-page tome takes the reader along on her gut-wrenching workdays for an entire seven months inside one of the most powerful and corrupted watchdogs of the powerful and corrupted players on Wall Street – the Federal Reserve Bank of New York.

The days were literally gut-wrenching. Segarra reports that after months of being alternately gas-lighted and bullied at the New York Fed to whip her into the ranks of the corrupted, she had to go to a gastroenterologist and learned her stomach lining was gone.

She soldiered through her painful stomach ailments and secretly tape-recorded 46 hours of conversations between New York Fed officials and Goldman Sachs. After being fired for refusing to soften her examination opinion on Goldman Sachs, Segarra released the tapes to ProPublica and the radio program This American Life and the story went viral from there...

In a nutshell, the whoring works like this. There are huge financial incentives to go along, get along, and keep your mouth shut about fraud. The financial incentives encompass both the salary, pension and benefits at the New York Fed as well as the high-paying job waiting for you at a Wall Street bank or Wall Street law firm if you show you are a team player.

If the Democratic leadership of the House Financial Services Committee is smart, it will reopen the Senate’s aborted inquiry into the New York Fed’s labyrinthine conflicts of interest in supervising Wall Street and make removing that supervisory role a core component of the Democrat’s 2020 platform. Senator Bernie Sanders’ platform can certainly be expected to continue the accurate battle cry that 'the business model of Wall Street is fraud.'"

Pam Martens, Wall Street on Parade

This is a good example of both regulatory capture and the credibility trap that co-opts those who benefits from the system as it is, even if it is by turning a blind eye and saying nothing, going along to get along, taking the 'bullet or the bribe.'

Never assume that because a person, such as media analyst or reporter, is highly paid that they are somehow beyond the temptation to violate their trust.  Quite the contrary.   They do not believe that change can come because they have anaesthetized their integrity as a matter of convenience.  And when called upon, they will support and defend and excuse the system as it is, at first by their inaction, and then by their willing cooperation.

The corruption takes a person one seemingly innocuous decision and event at a time.  their separate their fingers, one by one, until they finally let their souls slip through and fall— and they belong to the darkness of this world.  And at the end of the day, for what?   A little more money, the patina of prestige and superiority, access to power?

Who then can stand against the world, when power and money are assumed and created out of nothing, and distributed in an unjust, interconnected system of favors and services, without duty and without honor?

And so those captured in this system excuse and accept their own part in it, for their personal benefit and professional ego and advancement, that heady feeling of sophistication and acceptance by the worldly.

It's an old story  It is so old that at times it seems as if distant, just a story from another time— a fable.   But it is real.  It is the very fundamental core of this reality.  It is the continuing struggle.

It is, in the end, the only thing that matters, the only triumph or personal tragedy.  It is the only consequence that you will dwell upon, when the husk is stripped bare, and you yourself face the only certainty in this world alone, and as your truly are.





15 November 2015

Stiglitz: TPP Is an Anti-Democratic Law For the Benefit of Corporations, Not a Trade Agreement


When you have corporations having a very short-sighted view, paying their CEOs such outrageous monies with less money spent on investment, of course you’re not going to make long-term investments that are going to result in long-term economic growth.

And at the same time, there’s going to be less money to pay for ordinary workers. And paying that low wages to ordinary workers, not giving them security, not giving them paid, you know, family leave, all that results in a less productive labor force.

So what we’ve done is we’ve actually undermined investments in people, investments in the corporation, all for the sake of increasing the income of the people at the very top. So there’s a really close link here between the growing inequality in our society and the weak economic performance.”

Joseph Stiglitz

Stiglitz tends to excuse Obama at some point and blames the Republicans, I think he is being naive at best, wrong-headedly kind perhaps to one of the worst betrayals of a public mandate for reform in American history.

Obama is, at the end of the day, a corporate brand, a clever vehicle to attract and divert reform-hungry Americans who are tired of being misused and lied to.  He has betrayed his supporters at every key turn and on every major political and social issue from financial reform to healthcare.




11 August 2014

John Oliver on the US Payday Loans Industry


"Are there no prisons?"
"Plenty of prisons..."
"And the Union workhouses." demanded Scrooge. "Are they still in operation?"
"Both very busy, sir..."
"Those who are badly off must go there."
"Many can't go there; and many would rather die."
"If they would rather die," said Scrooge, "they had better do it, and decrease the surplus population."

Charles Dickens, A Christmas Carol


Usury is the practice of making unethical or immoral monetary loans intended to unfairly enrich the lender on the desperation or misfortune of others. (cf. unethically high drug charges promoted by patent protection).  A loan may be considered usurious because of excessive or abusive interest rates or other factors.  Someone who charges usury can be called an usurer, but the more common term in English is loan shark.

This video by John Oliver below discusses the payday loan industry in the US, which is remarkable even by today's lax moral standards when it comes to financial matters.

If not for the corruption of big money, outlandish fees from banks and usurious rates of interest from private financial companies could be stopped, and quickly.

Part of the problem is the attraction that some in the US have with the romantic notion of naturally good 'free markets' unencumbered by the means of protecting the weak and desperate from the stronger and unscrupulous.

People are not naturally good nor perfectly rational in all their affairs. And just because someone wears a suit and carries a pen and a high powered law firm instead of a gun does not mean that they are not a criminal in the truest sense of the word.

And the manner in which we are continually given corporations higher regard, more privileges, and more and more power over the individual is a sickness of our souls.  It is a portion of the worship of money and power above all else.

But Jesse, who is to say what the appropriate level of interest should be?

We have appointed regulators to do so, and there are certainly people more qualified as subject matter experts to do it.

But I would certainly tend to favor a Federal law that stipulates that no loan can charge more than 20 percent in annualized interest and fees in any 365 day period, or 1000 basis points over the Fed funds rate, whichever is higher, for any loan for any consumer loan as defined by the Consumer Protection Bureau.

And as for "States Rights" to do whatever they please, one could justify the minimal protection provided to the people among the various states under the Equal Protection Clause of the Constitution. If the corruption in a state authorized murder, slavery, child prostitution, drug addiction, mercy killings, sterilization, or torture, we would certainly not hesitate to assert the priority of the Bill of Rights for all citizens no matter where they lived.

Just because it is money that is involved does not mean that the injustice cannot be as serious an abuse to the public interest, to an individual or a family, even though one can assert that no one made them take the loan, or buy the drugs, or born handicapped, or fallen gravely ill. Public policy need to reflect the moral principles of a people at their most fundamental levels, or the government has no legitimate claim to be founded of, by, or for the people.