Whilst I agree that it was important, up to a point, to do, the net effect was to make the next cycle vastly more dangerous and vicious than the fiasco in 2008. By encouraging extensive and unwarranted risk-taking -- and guaranteeing no personal repercussions -- we are essentially giving these criminals a blank check to the accounts of the working class.Pdxfashionpioneer wrote:Similarly, we didn't bail out the banks to save the bankers; we did it to save the economy.
I'm not confident that it'll produce anything more than several thousand dead trees to print the excuses and platitudes on.One of things that will come out of the criminal investigations is that the real scandal lays in what is legal that shouldn't be!
It turns out that we have Bill Clinton -- a Democrat -- to blame for finally repealing Glass-Stegall, instead of vetoing Gramm-Leach_Bailey. Making matters worse, most of the useful components of Frank-Dodd were repealed -- and that signed off on by Obama (a Democrat), who should have vetoed it, but didn't. So, when I say that one party is as much to blame for this as the other I mean it; the outcomes show it. With the meat of Frank-Dodd being thrown away, the regulations to implement it will either never be written, or the few that were, will simply be removed.The real hazard in the banking industry wasn't so much the size of the executive bonuses it was that the pre-Dodd-Frank structure eliminated the downside risks. That was addressed in the legislation and is getting watered down in the regulation-writing process.
Also, legislation embodying a code of ethics should be implemented where if a fiasco does more than, say, 0.5% of the GDP, those responsible for engineering it (whether by intent or incompetence) can spend life in jail. For the truly egregious cases (Enron comes to mind, where it was, demonstrably done by intent) I could even support the death penalty for those at the top -- and I am not a supporter of capital punishment. After all, if a thug beats you up and steals your wages from last week, he goes to jail. Why is it, then, that someone can injure thousands, make off with millions, and walk away scot-free and whistling all the way to the bank?Build a robust firewall between commercial and investment banking land REQUIRE clawbacks when things go South, make it easy for shareholders, such as institutional investors, to sue the companies if they don't claw those bonuses back and you'll have a whole new ballgame.
While that may be true in the purest sense, there is also overt political meddling in the investigatory and prosecution departments, and, while the bureaucrats want to do what they signed on to do, they may have roadblocks thrown in front of them or otherwise get told to look the other way.As to the interest of the SEC and the IRS in enforcing the law, again it starts at the top, but basically, it's that old story of people want to do the jobs they signed up to do.
I assert that it's a by-product, and while it's disgusting to watch, and keeps a lot of important things from happening, the theatre keeps things under wraps from the general public. How would it look for congress to vote on a carbon-tax and shoot it down by a 70-30 margin? Resurrecting financial law that would (hopefully) keep another '80 panic from happening again by 70-30? A 70-30 defeat of reforms to the tax code to level the playing field? That'd look pretty shady -- and rightfully so -- because it'd show off in spades who's calling the shots. So it gets hidden by the cloak of "gridlock". Congress is not gridlocked at all on "what's important"; it's 70-30 or better. Unfortunately what's important to the billionaire class does not align with what's important to the general population.As to my statement as to where the gridlock is coming from, again, listen to what Mitch McConnell has said and look at what It's Worse Than You Think has to say.
Those started disappearing back in the 1980s, and are likely entirely repealed now.The anti-trust laws haven't changed much; it's the rules and enforcement philosophy that's changed. And again, that start's at the top.
Removing the inversion in rates that penalises work would be a very, very, good first step, but that is simply not going to happen. Even if the proposal makes into the form of a bill the theatre of gridlock will stall it indefinitely -- because for it to pass would require a very substantial number of (pre-selected, recall) politicians to defy their paymasters, and for it to fail would prove instantly that congress does not represent the will of the populace.Frankly we need to get tax rates, adjusted for inflation, back to where they were in the 50's or 60's. To do it we, as a nation, have to accept that Keynesian economics describe the real world a whole lot more accurately than Ayn Rand's.
Dollars don't vote, but dollars pick who you get to vote for.Dollars don't vote, people do.
I'm watching with distinct interest the rumblings and noise that the Russians are trying to game the US election. The reason I'm doing so is that I suspect that it's an early indication that the fix may go in if Trump wins and the election will get invalidated. Then it's a crap-shoot as to what will happen, but my money is on Clinton getting appointed to the post in some manner. It'd also finally point up precisely how corrupt the system has gotten. There's no provision for a re-match -- and a re-match might well produce very interesting (or very dangerous) results, or even possibly a Constitutional Convention where everything would be in play.
Interesting times indeed.
