Finance Reform Sham, CFPA Sham, SEC/Goldman Sham

 

I’ve written more than enough on the sham finance bill and didn’t see the need for another piece on it . (My most recent.) But I thought this post mortem was true and typical.

 

The ink is not even dry on the new rules for Wall Street, and already, the bankers are a step ahead of everyone else.

In ways large and small, the broad overhaul of the nation’s financial regulatory system that was approved by Congress on Thursday will eat into the profits of the nation’s banks.

So after spending many millions of dollars to lobby against the legislation, bankers are now turning to Plan B: Adapting to the rules and turning them to their advantage.

Even when it comes to what is perhaps the biggest new rule — barring banks from making bets with their own money — banks have found what they think is a solution: allowing some traders to continue making those wagers, as long as they also work with clients.

Banking chiefs concede they intend to pass many of the costs associated with the bill to their customers. The legislation, which is expected to be signed into law by President Obama next week, is intended to address the causes of the 2008 economic crisis and curb the most risky behavior on Wall Street.

“If you’re a restaurant and you can’t charge for the soda, you’re going to charge more for the burger,” said Jamie Dimon, the chairman and chief executive of JPMorgan Chase, after his bank reported a $4.8 billion profit for the second quarter on Thursday. “Over time, it will all be repriced into the business.”

 

Here are the banksters openly saying they’ll never take less than the extortionate amount they already extract. They regard their robberies as their divine right. As if we needed it, there’s a further declaration of war upon us, and further confirmation that humanity and the banksters cannot coexist in the same world.

 

So I think that’s adequate commentary on this vile sham of a “reform” bill.

 

Meanwhile, in order to confirm for anyone who still had doubts about whether or not Obama ever wanted a real CFPA, Geithner has gone out to oppose the appointment of Elizabeth Warren as its chief. (For a good post on Geithner as wingnut welfare poster boy, a complete failure throughout his worthless life at being anything other than a serviceable villain, see here.)

 

We knew this already, after the original white paper was so weak, eschewing vanilla requirements, and when the administration then without a fight let the thing be subverted and “pre-empted” in the House. So it’s no surprise today when they’re still hacking away at any possible effectiveness on its part, though that’s already a moot point. As I’ve always said, if you have to rely upon heroic personnel for effective regulation, then you can’t have sustained effective regulation over time. In a corporatist system, “regulation” can’t work.

 

Now, after howls of protest, the administration is publicly backpedaling, disclaiming any such opposition. So no doubt more nonsense will ensue.

 

I’ll just mention that the canonization of Warren seems overblown to me. She’s an administration cadre, a Harvard cadre, supports the system, supports the Bailout. The best one can say is that maybe she’s as good as it gets within the system, which is saying little.

 

Indeed, from the public interest point of view, wouldn’t it be better if someone more obnoxious were appointed? That would render the scam more brazen, obvious, and offensive. If you agree the bill’s a sham and want the people to understand that, why would you want an anodyne piece of window dressing like Warren to be part of it? It contradicts our educational mission.

 

It’s in light of this that we should consider the Goldman settlement. It’s a $550 million fine, and Goldman admits a marketing “mistake” and pledges to “reform” its policies. The SEC will distribute some of the proceeds to ACA and IKB, and Goldman agrees this amount is not mitigatory of any future civil awards. There’s all the standard crap about how Goldman agrees to closer oversight and how the SEC pledges to provide that oversight. It looks like a de facto global settlement as far as the SEC’s concerned.

 

I suppose from the reformist point of view there’ll be endless argument over whether or not this is a win for Goldman. From the point of view of taking back our country from these gangsters, the only question is whether or not this was a significant step toward the complete destruction of Goldman and all casino banking.

 

It seems not to be. On the contrary, the “best” case scenario seems to be that gamblers outside the bank hope the settlement will circumscribe the way Goldman can rig the game to the clients going forward.

 

But the game itself, which is purely destructive from any broader point of view, is to continue in its full ferocity.

 

Indeed, if the perception here is that the game will be less rigged vs. the client gamblers, then the settlement is a retrograde step, since one of the few good trends we’ve been seeing is the growing realization that Goldman’s a criminal against everyone including its own clients.

 

So anything that seems to improve the position of the clients is bad for the American people. From our point of view, it would’ve been better if the settlement had more obviously been a whitewash. Or even if Goldman had fought all the way and won. Insidiousness is always worse.

 

The corporate media will do all they can to spin this as a win for everyone, and as sufficient regulatory vigilance. Thus the NYT is calling it a “high-water mark” for regulators, trying to simultaneously exalt it as a big win but also lower expectations going forward. The spin will be: The SEC/Obama got tough, “investors” will be better protected; but Goldman is also vindicated of the worst charges, and implicitly the casino is now in better shape, and the American people should have more confidence in it going forward.

 

It’s all a Big Lie.