The Past As Spin

Representative Michelle Bachman is the national voice of The Tea Party. Recently, in speaking to a group of Iowans, she made some claims about American history that would be laughable if they had not come from someone who likes to style herself an authority of Constitutional matters. She claimed that the glory of our country is that color and language didn’t matter, nor did class or parentage, that once people got here, “we were all the same.” Wishful thinking at best. Certainly that was the idea behind the Declaration of Independence, with its grand opening phrases, but like all such ambitions, it took reality a long, long time to catch up—and it still hasn’t. The fact is, despite our stated political and social goals, immigrants have always had difficulty upon arriving here, some more than others, and those already here have always resented new arrivals. And even for those who were already living here, equality was simply not a reality. African slaves aside, women did not achieve equality until…well, some would say they’re still trying to achieve it, but just for one metric, they didn’t get the vote until 1921. People who owned no property were barred from the vote for a good portion of the 19th Century and other barriers were put up here and there, time and again, such as literacy tests. Anything to keep certain groups from being able to vote against the self-selected “true” Americans. She went further, though, and suggested that slavery was an unfortunate holdover from colonial times and that the Founding Fathers “worked tirelessly until slavery was gone from the United States.” She cited John Quincey Adams, who was a staunch campaigner against slavery. The problem, though, is that he was not a Founder. He was the son of one. [More . . . ]

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You and I are paying the legal bills of executives accused of fraud

Here is yet another secret deal that has recently seen the light of day thanks to the New York Times:

Since the government took over Fannie Mae and Freddie Mac, taxpayers have spent more than $160 million defending the mortgage finance companies and their former top executives in civil lawsuits accusing them of fraud. The cost was a closely guarded secret until last week, when the companies and their regulator produced an accounting at the request of Congress. The bulk of those expenditures — $132 million — went to defend Fannie Mae and its officials in various securities suits and government investigations into accounting irregularities that occurred years before the subprime lending crisis erupted. The legal payments show no sign of abating.
If this was such a good idea, why was it kept secret.

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Wikileaks and a Swiss bank list

On Monday, Rudolph Elmer is said to have turned over to Wikileaks names of US, UK and Asian celebrities, lawmakers and business-folks who may or may not have been trying to avoid paying taxes. Apparently, the data are confusing even to those used to dealing with such, so release won't be soon. Still, it will be interesting to see who is in the Heidi Fleiss Black Book of off-shore accounts. Most particularly if there are any prominent (and current) US lawmakers.

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Remember states’ rights? Sit back and watch the power of money

Mix Lux sees what's coming. Will it be another bailout for the banks in the form of a federal invasion of states rights? Will it be a federal law that says that banks don't need to obey state law? It could be ugly, and it might involve the transfer of massive amounts of money to banks that caused the current foreclosure problem. Lux cites to the writings of someone named "Numerian":

With increasing desperation, banks along with their enablers in Washington are going to try to jerry-rig a way out of this problem. Unfortunately for the banks, ex post facto laws are strictly forbidden by the Constitution, which is now being treated with new-found reverence by the Congress. It may be impossible to construct a law that solves problems like this that already exist. Perhaps the banks will get lucky, and some courts will begin to find in their favor, though that is certainly not the trend at the moment. Maybe the US Supreme Court will accept the banks’ argument that the securitization process in itself established a valid foreclosure claim even though mortgages were not properly assigned as required by state laws. This, however, would require the Supreme Court to make up a legal doctrine out of the blue (as the banks have done), thereby overturning all state laws and court rulings going back well over 100 years. Only a Supreme Court bought and paid for by bank lobbyists, and willing to prostitute itself publicly to its paymasters, would issue such a ruling. This means that the likely progression of events – the path we are now on - will lead to a near complete collapse of the housing market, because the big banks and the two government enterprises responsible for supporting the housing market will be fatally crippled wards of the state. The US government itself, including the Federal Reserve, will be equally crippled. Try as you might, you will find no words in the Bible – no phrases applicable to The Flood or to the destruction of whole cities at the hands of a vengeful God – that appropriately capture the financial gravity of this situation. But if we are forced to come up with some metaphor, Financial Armageddon will have to do.

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William K. Black notes the lack of prosecutions regarding financial fraud, and offers a solution

William K. Black previously worked as an investigator of financial institutions during the S&L crisis. In a detailed article at Huffpo, Black laments the almost total lack of criminal prosecutions related to our recent financial meltdown. Here's the problem in a nutshell: "What has gone so catastrophically wrong with DOJ, and why has it continued so long? The fundamental flaw is that DOJ's senior leadership cannot conceive of elite bankers as criminals." Here's what we need to do about it:

Our best bet is to continue to win the scholarly disputes and to continue to push media representatives to take fraud seriously. If the media demands for prosecution of the elite banking frauds expand there is a chance to create a bipartisan coalition in Congress and the administration supporting prosecutions. In the S&L debacle, Representative Annunzio was one of the leading opponents of reregulation and leading supporters of Charles Keating. After we brought several hundred successful prosecutions he began wearing a huge button: "Jail the S&L Crooks!" Bringing many hundreds of enforcement actions, civil suits, and prosecutions causes huge changes in the way a crisis is perceived. It makes tens of thousands of documents detailing the frauds public. It generates thousands of national and local news stories discussing the nature of the frauds and how wealthy the senior officers became through the frauds. All of this increases the saliency of fraud and increases demands for serious reforms, adequate resources for the regulators and criminal justice bodies, and makes clear that elite fraud poses a severe danger. Collectively, this creates the political space for real reform, vigorous regulators, and real prosecutors.

Continue ReadingWilliam K. Black notes the lack of prosecutions regarding financial fraud, and offers a solution