My recurring nightmare

October 11, 2009 | By | 1 Reply More

What I am posting here is a gnawing, recurring and growing concern that sometimes seems like a nightmare to me. It embarrasses me that this thought keeps recurring because it makes me look like one of those crazy conspiracy theorists.

What brought this “nightmare” to a head was watching Bill Moyers’ interview with U.S. Rep. Marcy Kaptur.  Here’s an excerpt:

MARCY KAPTUR: Let me give you a reality from ground zero in Toledo, Ohio. Our foreclosures have gone up 94 percent. A few months ago, I met with our realtors. And I said, ‘What should I know?’ They said, ‘Well, first of all, you should know the worst companies that are doing this to us.’ I said, ‘Well, give me the top one.’ They said, ‘J.P. Morgan Chase.’ I went back to Washington that night. And one of my colleagues said, ‘You want to come to dinner?’ I said, ‘Well, what is it?’ He said, ‘Well, it’s a meeting with Jamie Dimon, the head of J.P. Morgan Chase.’ I said, ‘Wow, yes. I really do.’ So, I go to this meeting in a fancy hotel, fancy dinner, and everyone is complimenting him. I mean, it was just like a love fest.

They finally got to me, and my point to ask a question. I said, ‘Well, I don’t want to speak out of turn here, Mr. Dimon.’ I said, ‘But your company is the largest forecloser in my district. And our Realtors just said to me this morning that your people don’t return phone calls.’ I said, ‘We can’t do work outs.’ And he looked at me, he said, ‘Do you know that I talk to your Governor all the time?’ He said, ‘Our company employs 10,000 people in Ohio.’ And I’m thinking, ‘What is that? A threat?’ And he said, ‘I speak to the Mayor of Columbus.’

As I watched this, I was thinking how amazing it was that a bank president would dare to treat a U.S. representative as though she meant nothing to him, even though she is a sitting member of Congress and a member of the political party that controls both Houses and the Presidency. How is it that all the big financial players such as Chase, AIG, Goldman Sachs, always get exactly what they want out of Congress? How can Congress allow these entities to continue to grow (since the meltdown), even though it is clear that the reason Congress felt that they needed to be propped up with tax money is that they were considered “too big to fail?” Name even one other industry that can snap its fingers and watch meaningful Congressional regulation completely dissolve.  Name another industry that can demand hundreds of billions of no-questions-asked tax dollars from Congress. Consider the vast power and potential abuses of the Federal Reserve, which works arrogantly and opaquely. Consider Matt Tabbi’s recent articles regarding these financial giants and Congressional Corruption (and see here).   We’re not even finished paying off the damage from the S&L scandal from the 80’s, and now, in the past year, we’ve taken on a new debt that dwarfs that S&L debt. And consider that when someone like federal Judge Rakoff has the integrity to stand up to speak truth to power, he seems to be a lone voice calling from a distant hilltop, not part of any sort of chorus.  Consider, too, the monumental struggle faced by Elizabeth Warren, Chair of the Congressional Oversight Panel , who is facing immense opposition in Congress to establishing a strong Consumer Financial Protection Agency (CFPA) to make sure that consumers stop getting ripped off by banks through the use of unintelligible contract language (how can this possibly be controversial?).

Pardon my French, but what-the-fuck?

Using Occam’s Razor (the principle that the simplest explanation is usually the best), how does one explain that huge numbers of our representatives have completely tanked on The People. How can we explain that many of our biggest financial institutions are increasingly engaged in reckless legalized gambling through the use of credit default swaps—essentially counterfeiting– and that based on the principle that actions speak louder than words, Congress doesn’t give a crap?

Here’s my nightmare. Congress is doing nothing because they are personally afraid to get in the way of the financial institutions. My nightmare is that they are afraid for their own personal safety and the safety of their family members and friends. I have no evidence that any member of any big financial institution has physically threatened any member of Congress—hence, I’ve framed this post as my “nightmare.”

My nightmare—and at this point it’s a totally unsubstantiated nightmare–suggests that it’s time to quit being naïve when it comes to the nonchalant and/or corrupt motivation of Congress. It’s time to stop looking only at the payola: legal (and potentially illegal) campaign contribution.

The big players of the financial services industry have increasingly been acting like a cartel, a cartel that engages in gambling and counterfeiting. My nightmare suggests that it’s time to consider all of the kinds of things that cartels threaten and do.  Consider that a street thug wouldn’t hesitate to shoot you in the face to steal your $200 wristwatch. What kinds of conduct would greed motivate when there are hundreds of billions of dollars at stake, including the job security of one’s 5,000 closest friends?

Consider, also, that 300,000 people are losing their homes to foreclosure every month, yet Congress won’t authorize a few hundred million dollars to get these people any meaningful legal representation.  Forty million of us now live next door to a foreclosed property.  92% people go down the tubes in foreclosure court without an attorney, even though many of them would be able to stop their foreclosure if only they had attorneys.  There’s no money to help all of these people getting kicked out of their houses, many of whom are facing foreclosure because they were victims of mortgage scams from which the big Wall Street firms benefited. Wall Street, which is handed hundreds of billions of dollars in “bail out money” that no one can track. And it gets worse and worse the closer you look.

The same people now in charge are the big players who caused the mess, and they have some terrific friends whispering terrible advice into Barack Obama’s ear. It’s not hard at all, because they have offices right down the hall! Consider, also, that action has been taken against the Wall Street ratings companies who recklessly and intentionally stamped fraudulent loans as “OK,” allowing mortgage fraud on an unprecedented scale. Speaking of Congress, it’s never been more clear that “the banks own the place.”  Well, actually it’s down to four banks that now control almost everything; until last year it was ten.    Four banks now own the place. How could it possibly be that even a big bank can “own” Congress?  What pressure could a few banks exert over a member of Congress, much less over hundreds of members of Congress?  In my nightmare, I wouldn’t need to be a big conspiracy at work–it might be a generalized fear of entities that truly got too big to fail.  Or is it too big to stand up to?

How thuggish and dangerous might a corporation get to preserve hundreds of billions of dollars in tax revenue and to maintain hands-off-government? This makes me wonder (it’s part of my nightmare) whether members of Congress being merely inept or corrupt, or whether they are actually afraid for the lives and safety of themselves and their children?  Money is a strong motivator, but is it strong enough a motivator to explain the reprehensible conduct of Congress?

In my nightmare I also wonder this: If anyone motivated to keep receiving huge amounts of tax dollars actually did threaten members of congress or their family members, would we ever know of this, other than circumstantially?

Or does anyone have some alternate nightmare that explains the past years’ events more parsimoniously?


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Category: Corruption, Economy, Politics

About the Author ()

Erich Vieth is an attorney focusing on consumer law litigation and appellate practice. He is also a working musician and a writer, having founded Dangerous Intersection in 2006. Erich lives in the Shaw Neighborhood of St. Louis, Missouri, where he lives half-time with his two extraordinary daughters.

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  1. Erich Vieth says:

    "The financial reform legislation making its way through Congress has Wall Street executives privately relieved that the bill does not do more to fundamentally change how the industry does business. Despite the outcry from lobbyists and warnings from conservative Republicans that the legislation will choke economic growth, bankers and many analysts think that the bill approved by the Senate last week will reduce Wall Street’s profits but leave its size and power largely intact. Industry officials are also hopeful that several of the most punitive provisions can be softened before it is signed into law."

    When an industry spends 1.7 BILLION in Congressional lobbying in ten years, what would they stop at, if anything, to get what they want?

    Why isn't our President taking the bully pulpit and going wild in favor of dramatic and meaningful Wall Street reform? But why would anyone assume that it's all carrot and no stick? As I mentioned in this post, people often get killed over a wristwatch or the cash in a wallet, or over a used car.

    This inaction by Barack Obama is making me crazy. Why has this President become pure rhetoric regarding Wall Street reform? Make this the first American industry that we reform the way it needs to be reformed, to the point where we completely kick out all the lobbyists and do what we need to do? No more too big to fail banks. Reenact Glass-Steagall.

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