There are two possibilities: the Obama administration knew for six years that the world’s largest banks were endemically led by frauds or the administration learned of that fact recently when it learned of the results of the FDIC investigation. The LIBOR scandal became public knowledge with the Wall Street Journal’s April 16, 2008 expose, so the Bush administration also knew it was dealing with elite frauds. If the Obama administration has long known that fraud was endemic among the leaders of the world’s largest banks, then its policies toward those CEO and the banks they control have been reprehensible and harmful.
If the administration has just learned from the FDIC investigation about the true nature of the CEOs that it has refused to hold accountable and allowed to retain and even massively increase their wealth through leading control frauds then we can doubtless expect a series of emergency actions transforming the administration’s finance industry policies. The FDIC lawsuit provides a “natural experiment” that allows us to test which of the possibilities was correct
Criminals are on the loose and Politicians are fearful of prosecuting them because they are major campaign donors..Let’s review the bidding. The U.S. government, through the FDIC, has found after a lengthy investigation that the leaders of 16 of the world’s largest banks conspired together to form a cartel to manipulate the LIBOR “numbers” and to defraud the public about the scam. This should have led the criminal justice authorities to prosecute large numbers of senior officers of these banks – but none of them have been prosecuted. It obviously poses a grave threat to the “safety and soundness” of the entire financial system. The endemic frauds led by elite CEOs demonstrate such a pervasive failure of integrity and ethics by the leaders of the finance industry that there is a moral crisis of tragic proportions. So here are some questions (along with the usual who, when, where details) I request that the media formally ask the administration:
- Did the FDIC brief the administration before it brought its LIBOR suit?
- Why didn’t Attorney General Holder and the FDIC leadership conduct a news conference announcing the suit and emphasizing its implications?
- Why didn’t the FDIC’s “home page” or press release site even note the suit?
- Did the suit cause the administration to transform its finance industry policies?
- When will the President address the Nation about fixing the twin emergencies?
I was on the campaign trail for State House this weekend at the 6th Annual Yellow Pollen Street Festival in Hampton, GA. Had a number of great conversations with voters. But one thing that struck me--across the political spectrum there is real anger at the Banks the endemic corruption in Washington DC that puts Wall Street and the big banks before the interests of every day citizens. People are fed up.
Its sad that the people who crashed the economy and destroyed millions of lives are still running amuck with no fear of criminal prosecution. This all reminds me of some comments by Cornel West on how intellectuals have betrayed the poor during the neoliberal era:
The reality is that the "Get Government out of the way" narrative has turned out to be an utter failure. Yet too many Democrats aid Republicans in continuing to push this narrative that has proven to be a failure.
Yves Smith expands on whats wrong with current strain of neolibearl American Capitalism;:
.....So with large corporations finding it more attractive to game their stock than duke it out in the marketplace, and small companies generally gun-shy in a tepid economy, we have the foundations for the corporate elite to continue looting. Meanwhile, ordinary citizens contend with a hostile job market and have little reason to hope that their financial condition will improve. Welcome to the neoliberal paradise.
Yeah paradise indeed.
Fact is we are 30 years late; but if you'd like to help fight back, chip in a few dollars to my State House campaign. Together we can begin to build a movement willing to fight back.