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Corrupt Government Officials Should Be In Jail … Alongside Corrupt Banksters
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Submitted by sjk on July 28, 2012 - 7:33pm
I been waiting for a few years now for this line of thinking to come about. I believe it's are only way to clean the system,and move forward.
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"Government regulators have become so corrupted and “captured” by those they regulate that Americans know that the cop is on the take. (Even top justice officials are incredibly cozy with Wall Street fraudsters.)"
Those who Benefited from Wall Street Fraud Must be Prosecuted … Including Rogue Government Officials who Aided and Abetted the Crimes
Yet the government has more or less made it official policy not to prosecute fraud, and instead to do everything necessary to cover up for Wall Street. For example, the Obama administration is prosecuting fewer financial crimes than under Reagan or either Bush.
For example, we pointed out in 2010:
The government’s entire strategy now – as during the S&L crisis – is to cover up how bad things are.
But it is not only a matter of covering up fraud that has already happened. The government also created an environment which greatly encouraged fraud.
Here are just a few of many potential examples:
The government-sponsored rating agencies committed massive fraud (and see this)
Economist James K. Galbraith wrote in the introduction to his father, John Kenneth Galbraith’s, definitive study of the Great Depression, The Great Crash, 1929:
The main relevance of The Great Crash, 1929 to the great crisis of 2008 is surely here. In both cases, the government knew what it should do. Both times, it declined to do it. In the summer of 1929 a few stern words from on high, a rise in the discount rate, a tough investigation into the pyramid schemes of the day, and the house of cards on Wall Street would have tumbled before its fall destroyed the whole economy. In 2004, the FBI warned publicly of “an epidemic of mortgage fraud.” But the government did nothing, and less than nothing, delivering instead low interest rates, deregulation and clear signals that laws would not be enforced. The signals were not subtle: on one occasion the director of the Office of Thrift Supervision came to a conference with copies of the Federal Register and a chainsaw. There followed every manner of scheme to fleece the unsuspecting ….
This was fraud, perpetrated in the first instance by the government on the population, and by the rich on the poor.
The government that permits this to happen is complicit in a vast crime.
In other words, the fraud started at the very top with Greenspan, Bush, Paulson, Negraponte, Bernanke, Geithner, Rubin, Summers and all of the rest of the boys.
As William Black told me today:
In criminology jargon: they created an intensely criminogenic environment.
The government’s special inspector general in charge of oversight of the Troubled Asset Relief Program (the “TARP” bank bailouts) – Neil M. Barofsky – said today:
It was a “message to the banks ‘if we commit fraud, we break the rules, don’t worry, we’re too big — they’ll never bring the appropriate steps against us,’” Barofsky says in an interview with The Daily Ticker. “And that is why we’ve had scandal after scandal after scandal.”
This was a “global conspiracy to fix one of the most important interest rates in the world,” Barofsky continues. “[Geithner] heard this information and looked the other way. Geithner and other regulators should be held accountable, they should be fired across the board. If they knew about an ongoing fraud, and they didn’t do anything about it, they don’t deserve to have their jobs. I hope we see people in handcuffs.“
Government regulators have become so corrupted and “captured” by those they regulate that Americans know that the cop is on the take. (Even top justice officials are incredibly cozy with Wall Street fraudsters.)
Institutional corruption is killing people’s trust in our government and our institutions, which is one of the reasons the economy is faltering again.
Indeed, polls show that very few Americans believe that the U.S. government has the “consent of the governed”, a higher percentage of Americans liked King George during the Revolutionary War than like Congress today, and people are publicly discussing whether it’s a good or bad idea to “hang bankers”.
I noted 7 years ago:
I am NOT calling for the overthrow of the government. In fact, I am calling for thereinstatement of our government. I am calling for an end to lawless dictatorship and a return to the rule of law. Rather than trying to subvert the constitution, I am calling for its enforcement.
The best way to avoid all types of revolution would be for the government to start following the rule of law. I passionately hope it will do so.
While conservatives tend to view government as the problem, and liberals tend to view corporations as the problem, the real problem is the malignant, symbiotic relationship between corrupt officials and criminal corporate leaders. Without the cancerous relationship, neither side could cause so much damage. If Americareturns to the rule of law, we might have a fighting chance.
The justice system may be the only thing which stands between peace and violence. All of those who benefited from Wall Street fraud must be prosecuted … including corrupt government officials who aided and abetted their crimes, helped cover them up, or have blocked prosecution.
Iceland should be a role model:
Iceland has prosecuted the fraudster bank heads (and here and here) and their former prime minister, and their economy is recovering nicely… because trust is being restored in the financial system.
Indeed, even evangelical leader Pat Robertson agrees:
Pat Robertson discussed the banking crisis and glowingly spoke about how Iceland jailed many of the bankers who devastated their nation’s economy by taking out fraudulent loans. Robertson hailed the Nordic nation for its actions and said that Americans should deal with the financial crisis in the same way.
“They are putting people in jail. Prime ministers are being indicted. They are going after banks. The people said the banks are ripping us off. We don’t like what they did, and they brought our country to ruin. Suddenly, Iceland is turning around and they look like a big success story!”
“We could start putting all of those bankers in jail. There was not one banker prosecuted and so many people were lying, and so-called “no-doc loans” and liars’ loans, and none of them have been held accountable.
Iceland is leading the way and their GDP is growing, and all of a sudden, they were in a terrible mess, terrible mess, and look what is happening!”
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