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While the Financial Crisis Commission Report Looks Impressive At First Glance, It Doesn't Hit Hard Enough ... and Won't Lead to Any Real Change
The Financial Crisis Inquiry Commission largely blames Greenspan, Bernanke, Geithner, Summers, the rating agencies, SEC and big banks for the economic crisis. (Here's the final report).
Bernanke is still Fed chief, and the government has substantially increased the Fed's power in the last year. See this, this, this, this and this.
Geithner is still Secretary of the Treasury.
Summers just resigned, being replaced by someone with a virtually identical philosophy, background and mindset as Summers.
The rating agencies are unrepentant, and have not been reined in. They are still government-sponsored monopolies which are accept bribes to give high ratings. And see this.
The
SEC is still not acting as a real watchdog, and the banks are still
speculating wildly with excessive leverage and acting as predators -
instead of supporters - of the real (non-financial sector) economy.
Indeed, the banks are growing even larger, instead of being downsized, even though independent financial experts say that the very size of the banks is hurting the economy.
The FCIC report doesn't really tackle that issue (the phrase "too big
to fail" does not appear in the report itself, only in a very peripheral
way in the footnotes).
Nor does the report detail the fact that inequality in the U.S. is higher than it has been since 1917, and that inequality was one of the prime causes of the economic crisis. The FCIC does not even mention the words "inequality" or "oligarchy", and mentions the word "oligopoly" only once (in a footnote) .
And
while the FCIC report discusses mortgage fraud, it does not dig deeply
enough into fraud by the largest financial players, detail other types
of financial fraud, or push hard enough for prosecution, even though
fraud was one of the core causes of the financial crisis, and one of the main reasons that the economy has not stabilized.
For example, the report uses the word "fraud" 46 times, compared to
167 mentions of "leverage". The phrases "control fraud", "accounting
fraud", "regulatory capture", "systemic fraud", "criminal fraud" and
"criminally negligent" do not appear anywhere in
the report, nor do the words "looting" or "Ponzi". The word
"prosecute" appears only once (and only in a historical context), and
the word "prosecution" appears only 6 times (and half of them are
buried in footnotes). The word "corrupt" appears only twice (one of
them in a footnote).
So - while the FCIC report looks impressive at first glance - it doesn't hit hard enough, and is not going to lead to any real change.
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The next crash will be a doozie. You mean after taking all of our home equity they now have to destroy our 401ks, pensions, savings? You betcha!
Denial works until it doesn't, concordantly it's just fantasy. If fraud/denial/fantasy worked, then the alcoholic/drug addict would never need to hit rock bottom or die from the self inflicted process. It works for a while, until something more powerful overcomes the self-deception/fabrication. What is reality? In some ways it doesn't matter. It's there, whether or not you accept it is up to the individual on a moment to moment basis.
fraud is not being tackled because the whole football team is corrupt
Just another day in Pluto-Klepto-Orwellian-ocracy. Even tho it seems that any revenge will have to be served very cold...fried vampire squid had better be on the menu, with a side of politi-puppets.
Still waiting for the first drop....
then the gibbet. Tomorrow's children demand justice.