October 24, 2010

Transparency, Wikileaks, and Odious Secrecy


Today the people are the beneficiaries of the latest Wikileaks document delivery, nearly 400,000 pieces of information touching on every aspect of the horrors of the Iraq war of aggression. I’ve previously written about Wikileaks here and here.
We ought to be the beneficiaries, if we choose to use this opportunity to learn about the crimes of this system. Unfortunately the previous deliveries didn’t have much immediate effect on the shocking complacency of what may be a terminal slave populace. But it’s too early to know how the beer will taste until it’s fully brewed. These things sometimes fester underground, like the flame that can slowly smoulder its way invisible through miles of subterranean pine needles before it bursts into the air as wildfire.
We have no idea what the tipping points will be, and what gradual, organic forces and tensions will have undermined the balance to the point of sudden imbalance.
However that may be, sunlight is a pure value. It warms, it invigorates the air, conjures the photosynthetic basis of complex life. It illuminates, it directs, it teaches, it inspires.
And while as individual human beings we also need and are entitled to our shade and shadow and our night as well, no one has the right to block out the sun. The information our society creates belongs to us all. It is our property as citizens. It’s our social sunlight, which illumines our collective truths. Top down secrecy is odious. It’s a theft of public property. It’s a characteristic crime of tyranny, committed for the obvious reason of concealing from us the rest of their crimes against us. It’s also done for its own sake, out of the inertia of power and the haughty sense of entitlement of elitism itself. It’s the smothering fog coughed up to obscure our sun. It’s shoving us into the grave dug for us, and the shoveling of sterile dirt upon our heads. Secrecy is death.
There’s certainly no “practical” reason for it. America has no existential enemies, except the criminals themselves. And even its lesser terrorist enemies are not a threat worth all we’ve pusillanimously surrendered to them. They’re mostly a threat to the elite empire, not to the citizenry. And it’s the empire’s war which creates the terrorists anyway. The Arab world long ago got sick of jihad. Only US aggression still fans those flames. So the pretext for the secrets is the same crime which generates the opposition whose alleged threat is supposed to justify the secrets. This is the same crime whose details the secrecy seeks to cover up. We’ll find that this applies in every example, not just the war.
So secrecy has no practical purpose or moral validity. Secrecy can only be part of legitimate sovereignty to the point it is absolutely necessary on account of some existential threat. Where, as in our case, this threat is nonexistent, the justification is nonexistent. So to the rest of our indictment we can add that a secretive government is an illegitimate government. In our case secrecy is not part of sovereignty, but is only instrumental toward tyranny.
Julian Assange of Wikileaks is an eloquent articulator and relentless activist of this ideal.

WikiLeaks receives about thirty submissions a day, and typically posts the ones it deems credible in their raw, unedited state, with commentary alongside. Assange told me, “I want to set up a new standard: ‘scientific journalism.’ If you publish a paper on DNA, you are required, by all the good biological journals, to submit the data that has informed your research—the idea being that people will replicate it, check it, verify it. So this is something that needs to be done for journalism as well. There is an immediate power imbalance, in that readers are unable to verify what they are being told, and that leads to abuse.” Because Assange publishes his source material, he believes that WikiLeaks is free to offer its analysis, no matter how speculative…..

Assange does not believe that the military acts in good faith with the media. He said to me, “What right does this institution have to know the story before the public?”…….

In some respects, Assange appeared to be most annoyed by the journalistic process itself—“a craven sucking up to official sources to imbue the eventual story with some kind of official basis,” as he once put it. WikiLeaks has long maintained a complicated relationship with conventional journalism. When, in 2008, the site was sued after publishing confidential documents from a Swiss bank, the Los Angeles Times, the Associated Press, and ten other news organizations filed amicus briefs in support. (The bank later withdrew its suit.) But, in the Bunker one evening, Gonggrijp told me, “We are not the press.” He considers WikiLeaks an advocacy group for sources; within the framework of the Web site, he said, “the source is no longer dependent on finding a journalist who may or may not do something good with his document.”

Assange, despite his claims to scientific journalism, emphasized to me that his mission is to expose injustice, not to provide an even-handed record of events. In an invitation to potential collaborators in 2006, he wrote, “Our primary targets are those highly oppressive regimes in China, Russia and Central Eurasia, but we also expect to be of assistance to those in the West who wish to reveal illegal or immoral behavior in their own governments and corporations.” He has argued that a “social movement” to expose secrets could “bring down many administrations that rely on concealing reality—including the US administration.”

And here:

This information has reform potential. And the information which is concealed or suppressed is concealed or suppressed because the people who know it best understand that it has the ability to reform. So they engage in work to prevent that reform . . . .

There are reasons I do it that have to do with wanting to reform civilization, and selectively targeting information will do that — understanding that quality information is what every decision is based on, and all the decisions taken together is what “civilization” is, so if you want to improve civilization, you have to remove some of the basic constraints, which is the quality of information that civilization has at its disposal to make decisions. Of course, there’s a personal psychology to it, that I enjoy crushing bastards, I like a good challenge, so do a lot of the other people involved in WikiLeaks. We like the challenge.

He writes in his manifesto, “Conspiracy as Governance”,

He had come to understand the defining human struggle not as left versus right, or faith versus reason, but as individual versus institution. As a student of Kafka, Koestler, and Solzhenitsyn, he believed that truth, creativity, love, and compassion are corrupted by institutional hierarchies, and by “patronage networks”—one of his favorite expressions—that contort the human spirit. He sketched out a manifesto of sorts, titled “Conspiracy as Governance,” which sought to apply graph theory to politics. Assange wrote that illegitimate governance was by definition conspiratorial—the product of functionaries in “collaborative secrecy, working to the detriment of a population.” He argued that, when a regime’s lines of internal communication are disrupted, the information flow among conspirators must dwindle, and that, as the flow approaches zero, the conspiracy dissolves. Leaks were an instrument of information warfare.

The organization is a model of rhizomatic resilience and redundancy:

Assange is an international trafficker, of sorts. He and his colleagues collect documents and imagery that governments and other institutions regard as confidential and publish them on a Web site called WikiLeaks.org. Since it went online, three and a half years ago, the site has published an extensive catalogue of secret material, ranging from the Standard Operating Procedures at Camp Delta, in Guantánamo Bay, and the “Climategate” e-mails from the University of East Anglia, in England, to the contents of Sarah Palin’s private Yahoo account. The catalogue is especially remarkable because WikiLeaks is not quite an organization; it is better described as a media insurgency. It has no paid staff, no copiers, no desks, no office. Assange does not even have a home. He travels from country to country, staying with supporters, or friends of friends—as he once put it to me, “I’m living in airports these days.” He is the operation’s prime mover, and it is fair to say that WikiLeaks exists wherever he does. At the same time, hundreds of volunteers from around the world help maintain the Web site’s complicated infrastructure; many participate in small ways, and between three and five people dedicate themselves to it full time. Key members are known only by initials—M, for instance—even deep within WikiLeaks, where communications are conducted by encrypted online chat services. The secretiveness stems from the belief that a populist intelligence operation with virtually no resources, designed to publicize information that powerful institutions do not want public, will have serious adversaries……

Assange also wanted to insure that, once the video was posted online, it would be impossible to remove. He told me that WikiLeaks maintains its content on more than twenty servers around the world and on hundreds of domain names. (Expenses are paid by donations, and a few independent well-wishers also run “mirror sites” in support.) Assange calls the site “an uncensorable system for untraceable mass document leaking and public analysis,” and a government or company that wanted to remove content from WikiLeaks would have to practically dismantle the Internet itself……..

As it now functions, the Web site is primarily hosted on a Swedish Internet service provider called PRQ.se, which was created to withstand both legal pressure and cyber attacks, and which fiercely preserves the anonymity of its clients. Submissions are routed first through PRQ, then to a WikiLeaks server in Belgium, and then on to “another country that has some beneficial laws,” Assange told me, where they are removed at “end-point machines” and stored elsewhere. These machines are maintained by exceptionally secretive engineers, the high priesthood of WikiLeaks. One of them, who would speak only by encrypted chat, told me that Assange and the other public members of WikiLeaks “do not have access to certain parts of the system as a measure to protect them and us.” The entire pipeline, along with the submissions moving through it, is encrypted, and the traffic is kept anonymous by means of a modified version of the Tor network, which sends Internet traffic through “virtual tunnels” that are extremely private. Moreover, at any given time WikiLeaks computers are feeding hundreds of thousands of fake submissions through these tunnels, obscuring the real documents. Assange told me that there are still vulnerabilities, but “this is vastly more secure than any banking network.”

This is a new model for the kind of sunlight activism we need. Imagine a whole media system dedicated to such recovery of the people’s stolen information. (I’m of course referring to collective public information, regarding politics, the economy, business, foreign policy. Just as with property in general, the personally used item or information belongs to the individual; the collective infrastructure belongs to those who build it.) We can know our need for so many suns as we survey the wasteland of odious secrecy. I’ll just select some of the examples from some of the fronts.
The Banks:
So many secrets of the Bailout. The Fed’s still stonewalling the fight for sunlight which has outlived its originator, Bloomberg reporter Mark Pittman. Will we ever know how much taxpayer money was embezzled by the Fed’s “facilities” and arcane Treasury programs? How much was handed to the banks practically for free to let them gamble against our economy, prosperity, and society?
No sooner was the sham finance bill passed than it came to light (heh) that the bill contained a provision allowing the SEC to keep practically all of its activities veiled from the FOIA. Although Congress went through the charade of “fixing” this “oversight”, even the fix still adjures the SEC to protect the secrets of hedge funds.
So there’s a good example of what the sham finance “reform” bill was really about. Since they were worried that SEC activities which were subject to FOIA requests could become a conduit for throwing sunlight on the shadow banking system, they used the bill as a mechanism for indirectly gutting the FOIA where it comes to the finance sector. We should look for such anti-FOIA gambits in every other kind of bill.
Among its many vectors of criminality, the MERS system is meant to cause all mortgage information to disappear down a black hole. But the land belongs to the people, and the banks have no right to secrets over it. Why should we ever agree that some secret system vouches for the ownership of land? It’s not bad enough we have private property in land on the part of unproductive bankster “owners”, but this system of ownership is also being kept secret from we the people, from whom this potentially productive land was stolen in the first place?
The truth is that the banks themselves have long since lost track of this ownership, and abrogated the chain of title beyond redemption. Part of the point of MERS was to carry that out, and now part of its point is to conceal it.
Even a neoliberal propertarian like Hernando de Soto deplores this assault on transparency, considering it subversive of property rights. Among the criteria he lists for stability of the property regime are that all assets and transactions be listed on publicly accessible registries, that all finance deals must stay closely tied to the real value of the underlying asset (so it follows that this value must be transparent), and that government must forbid opacity and obfuscation in the language of market transactions.
(I mention de Soto to demonstrate that a leading neoliberal concurs in the assessment that the MERS system, including its secretiveness, has called landed property itself into quesion.)
The Health “Insurance” Rackets:
They’re notorious for total darkness where it comes to pricing. (Doctors and hospitals are guilty of that too.) The customer has practically no basis for cost comparison or any kind of understanding of why he’s being quoted the rate he’s experiencing. The racket bailout bill alleges it will change that, but we’re already seeing how well the bill’s provisions are being enforced.
Internet Access and Participation:
The telecoms and cable companies have so far mostly refrained from transmission discrimination because they fear political fallout and a consumer backlash. But the formal enshrinement of net neutrality has become all the more critical as the technology now exists to let the telecoms discriminate in a secretive manner.
(The FCC’s proposed net neutrality principles, even if enshrined, may actually be pretty weak against such secret discrimination. But one fight at a time. Let’s get a basic net neutrality enshrinement, and then we’ll improve it.)
The FDA, a corporate tool, has done all it can to keep secrets from the American people about the safety and costs of their own food. It seeks to ban GMO-free labeling. Although it hasn’t (yet) banned bovine growth hormone labeling, it allows and is encouraging states to do so. Recently a federal court overturned an Ohio state ban where the Agriculture Department sought to intervene on behalf of the state.
The Obama administration also continues the Bush tradition of refusing to update public environmental databases even where required by law. In this case the USDA has refused to update its pesticide use database since 2007.
The Gulf Oil Eruption:
Perhaps the most chilling secrecy event, imposed not by stealth and bureaucracy but by brute force, was Obama’s literal handing over of (anti-)sovereign jurisdiction over much of the US part of the Gulf of Mexico to BP. Federal employees openly said they could only do or allow what BP authorized, and federal agents became de facto privatized deputiesWe still know almost nothing about what’s really happening in the Gulf, and while we’ll eventually know the full effects if only by experience, the system criminals will do all they can to keep our information from us as long as they can, to our economic and health detriment.
(With all of these, we should recall the sick joke out of Chicago, how markets were going to be “free” and “efficient” and “rational” since all “participants” would have all the necessary information. But as I described in my deconstruction of the ideological and “constitutional” rationale for the Stamp mandate, we were really never considered participants in this utopian market, but passive subjects, clay to be worked, a resource to be mined, victims. That’s the full Orwellian truth of neoclassical economics. So there also lies their explanation for how Secrecy = Transparency. Their theory was only ever meant to apply to the elites themselves.)
It’s easy to see how many powerful interests are ranged against the people’s sunlight. So it’s also no surprise that Assange and Wikileaks have been demonized by the government, the MSM, and conservative and liberal hacks alike. (Including quite a few of the “real progressives” who oppose Obama, but who nevertheless as liberals remain elitists and still viscerally abhor the ideal that the elites are entitled to no secrets at all.)
The fact that such an array of criminals has assembled against Wikileaks is a metric of its effectiveness, and even more, of its perceived threat, and a badge of honor. We can expect every kind of tactic to be deployed against Assange and the rest of the team, but the aspirations of the organization and the task may just withstand the onslaught. It’ll help if more people and organizations follow on this path.
We who reject the existence of the “elites” also reject their nonexistent right to keep secrets. Every leak against the will of the elites is a restitution of stolen property. Wikileaks is in fact an agent of law and order, and its people are part of the human citizenry.

July 17, 2010

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.

April 30, 2010

Signal Lanterns

Filed under: American Revolution, Freedom — Tags: , , , , , , — Russ @ 12:55 am


A few weeks ago, April 18-19, was the anniversary of Lexington and Concord and Paul Revere’s legendary midnight ride. I didn’t think of it at the time, preoccupied as I was with stuff like the SEC and Goldman. But I intend to pay closer attention to these august dates from our lost revolution in the future.
It’s literally true that Paul Revere’s ride is a legendary matter. Throughout American history there have been many Reveres. There was the original story of the “wounded innocence” of 1775, the province of all who were forced by fate into the crucible of war and revolution. (Though when the participants were getting their story straight they rejected Revere’s own deposition because he wouldn’t swear to the alleged fact that the British fired first at Lexington, and he alluded too much to the patriots’ prior preparations for exactly such a British march, which planning tended to contradict the wounded innocence contention.)
The story of the heroism of the midnight ride and the signal lanterns was the folklore of Boston right from those first heady days. The legend grew though the first half of the 19th century. Then came the Civil War, and with it Longfellow’s immortal tale of the lone hero with his ringing call to a nation to fight for its freedom. It was carefully tailored to resonate with a public being fired up for war, and at the same time to flatter the already prominent American legend of the hardy, self-reliant man of action. The story had spectacular success from its publication in January 1861, and this has been the base of the legend ever since, while further hagiography as well as debunking built upon (or chipped away at) this base. Thus we’ve seen the martial “Colonel Revere” of proud imperial days, and Esther Forbes’ “simple artizan” [sic] of 1942, the common man who rose to the occasion, and even the capitalist-soldier of the Cold War, as well as the relatively playful satirical treatment of Revere and other patriotic-affiliated figures following the pointless horror of the Great War, or the far more angry debunkers of the Vietnam and Watergate era (some of them going so far as to claim the midnight ride never took place, or that Revere was drunk as he rode, or that he was a  snitch). And so on into modern times where between structural depictions of the social forces of history and “political correctness” Revere and his midnight ride have often disappeared completely.
While we can dismiss shallow liberal “correctness” with the level of respect it deserves, we are forced to recognize the power of history itself and its economic and social currents. Today especially we’re buffeted amid a vast turbulence of forces. So far as I can see the readers of this blog agree that the global financialized debt system is doomed and must collapse of its own weight, and also that there’s little even a large mass of the peasantry, let alone a few lonely denizens of the blogosphere, can do to affect the way these forces play out and the tempo of their doing so.
Where does this leave the people and events of our legends? Whether we take the legend of a lone midnight rider (or a handful of riders if you include Dawes and Prescott, who are the only other well-known names) and wounded innocence which spontaneously rose and fought back at Lexington and Concord, or whether we go with the more accurate story of a several dozen messengers acting out a well-laid plan which culminated in the vigorous resolution of the fight, either way it’s still just a relative handful of people.
Did history have greater space for contingency and small-scale agency back then? Was that too a casualty of the industrial age, the oil age, the age of masses, and by today nothing can any longer be contingent, and no one, not even among the powerful, can be an agent?
And then there’s the question of whether today’s events ever still concentrate such pivotal significance into such a small space, in terms of time, geography, and the number of actors engaged. If instead we expand the idea to just look for the metaphorical Lexington event, which could serve to fire the will to fight of millions, or if we go further and seek to envision the discrete moment which could signal the final breaking of the exponential finance and Bailout wave, it’s still hard to imagine. 
What can today be the equivalent of a General Gage marching upon Lexington? The latest and most exciting event has been the SEC’s filing against Goldman, which has indeed excited everyone to the point that we see speculation everywhere on whether this is the breaking point for Goldman, or even the turning of the tide against Wall Street itself. Almost as pregnant with portent is the looming European debt default unwind, which may roll up the EU itself, with incalculable consequences. We still have zombie Dubai, still extending and pretending. And providing eschatological backdrop as well as threatening economic devastation itself, we have the eruption of Iceland. Can any of these really provide the non-linear break? We’ll rightly keep doubting until the moment it happens, and probably for some time afterward, just as the newspapermen who witnessed the first Kitty Hawk flight said “that’s nice” and went home thinking, “that was a neat trick, whatever they were really doing”, and it was days before what had happened really sunk in. 
When I think of the early days of the crisis the date 9/29 still leaps out at me. I remember writing it on the cover of the notebook I started in August. On 9/29/08 I wrote, “Sarajevo”. It was the day the first TARP vote rejected it. Of course we know what happened next, and by now I don’t say that date was particularly important. But at the time it struck me as a critical moment in the crisis. I thought they might actually have to start letting the whole thing unravel right then and there. But of course that didn’t happen, then.
Can there really be such a day? Can there be Marches of the Regulars and midnight rides? And even if there still could be, could there again be a response? Can the Minuteman spirit ever reawaken?
Well, that’s just some musings when I thought about the old days. Paul Revere struck me because his legend has been so resilient and evocative for so long for so many. Like I said, I don’t know if they even teach him in school anymore. But should we ever be able to seize upon events, it would be of great use to have the legends to help render them familiar. Not just Revere (who’s really just an example here, but a good one) but the entire heritage is waiting and wanting to do real work once again. It wonders, How was our Revolution lost?
So I just wrote this as some notes and suggestions for further thought. Maybe it doesn’t make a lot of sense, or maybe it’ll give people something to think about. We seem to have unfathomable time (meaning simply that we have zero idea if the zombie starts toppling tomorrow or five years from now or anytime in between) and not a huge number of options for what to do with it at the moment.
Oh well, another strange gizmo for the toolbox.

April 28, 2010

Goldman Testifies: “We’re Not That Smart.” Jerks, too.


As I wrote a few days ago, I’m not concerned about whether or not Goldman actually did violate Wall Street’s own self-rigged law. So the technical strength of the SEC’s case is a side issue, at most a gauge of how far the law’s abdication has really progressed.
We should never fall into the trap of letting the enemy frame the issue according to their own corrupt measure of “law”. The dispute of whether or not something is technically illegal is always likely to help the banksters and not the people. We must always insist that these are crimes by any moral measure, crimes against humanity, and would be legalistic crimes in any human community which lived according to the rule of law. That there’s even a debate about the vast, systematic fraud of Wall Street, executive control fraud as the very basis of their business model, or about specific examples of patent fraud like the Abacus con, proves that we no longer have the rule of law in this country. At best law is something struggling to crawl back out from under the massive weight of poisoned mud under which Wall Street and Washington buried it alive.
As for their rigged laws today, the only reason we should look to where their crimes run afoul of even that corrupt measure is to taunt, “Even by their own rigged laws they’re guilty!” But that’s never our measure of the indictment. We know that just as nothing short of Nuremburg could deal with the magnitude of (mostly legalized) Nazi crime, so only a Second Nuremburg can deal with this, the same magnitude and quality of economic crime.
So with that in mind let’s look at yesterday’s spectacle. Its significance is political. Although it may affect the legalistic proceedings, the real value of it was to highlight before the eyes of the people the everyday criminal actions and unregenerate, clinically psychopathic mindset of these criminals. The more people see the gangsters squirm and stutter under the glare of such simple, morally common sense questions as “Do you think when you sell a security to an investor he has a right to believe you don’t think it’s going to fail?”, the more obvious it becomes that these are nothing at all but gutter con men, with their victim being no one less that America itself. (Although we also need to do more work from the other side of the issue: That they create nothing, perform no useful function. It’s true that “he only destroys” and “he produces nothing” are saying the same thing, but unfortunately many among the masses treat those as two distinct ideas.)
Let’s look at a few choice moments with Blankfein and Viniar. (The questioning of the peons was more of the same. It reinforces the ugly picture given by Blankfein and Viniar. We did learn that Tourre’s lawyers are really Goldman’s lawyers. So he’s either being set up to take the fall, or they already have a private deal worked out for him to willingly take the fall.)
It’s clear that they’re all incapable of anything but lame excuses and phony, truculent acquiescence when pressed about human issues like ethics or remorse. None of these thugs has a shred of those, or of any other human quality. They are in fact something alien to us, a species of vermin.
The only times they sound authentic are in their bursts of criminal defiance.
Perhaps my favorite moment was Viniar repeatedly saying he regrets that anyone wrote about Goldman’s crimes in an e-mail, and the vulgar tone of some of them, but not the crimes themselves.

Senator Levin is back to leading the questions, and his back and forth with Mr. Viniar has captivated the room.

He starts with a basic question, one he and other senators have asked so many others today: Do you think that a customer has a right to believe that you want securities that you sell to succeed?

Mr. Viniar, a numbers guy, stumbles: “I’m not sure what succeed actually means.”

Mr. Levin continues, asking if a customer has a right to believe that Goldman is selling something the firm believes is a solid security.

Mr. Viniar says that “when we sell securities to customers, we don’t necessarily have a view that they’re going to go up or down.”

Mr. Levin says that’s not what he meant. He means that customers do not think Goldman would sell something it thinks is junk, or the more vulgar word that the senator used. (Forgive him, though, he was citing Goldman employees in e-mails.). Mr. Levin says he sees a very clear conflict of interest that needs to be dealt with. He asks Mr. Viniar what he felt when he heard about the things Goldman employees had written about these deals, again using vulgar words.

Mr. Vinar replies, “I think that’s very unfortunate to have on e-mail.”

The room erupted in a gasp.

Mr. Viniar continues: “I think it’s very unfortunate for anyone to have said that in any form.”

The senator presses the chief financial officer, who adds, that he thnks it’s unfortunate in and of itself that his employees thought their deals were junk — or worse, as the words indicated.

Mr. Levin retorts, “That’s where you should have started.”

He then called a brief recess for the procedural vote on the financial bill.

[Then, after the recess:]

Mr. Viniar said Senator Levin was 100 percent correct in the statements he made before the procedural vote. Mr. Viniar said he felt he should have straight off expressed dismay at the vulgar expressions that some at Goldman believed described their own deals.

He was groping to say something like, “I regret that we had people with such an unprofessional, unethical attitude about our duties to our clients; this does not reflect the Goldman creed”, but try as he might he couldn’t find the words. It was like a scene in a movie where the character can’t help revealing what he really thinks even though he’s trying to conceal it. (After a break he tried again, and again could only say, “I regret the vulgarity”. How clueless, how unaware of one’s surroundings, can one get?)
We look here directly into the black abyss of these soul-dead criminals. They’re so committed to their crimes, so engrossed in them, that they’re incapable of any attitude other that open defiance or fumbling, incompetent spin. They’re such clinical psychopaths they’re no longer even capable of tactical lying where it comes to the politics of the situation. They have a disease. We should be grateful for it, since things would be worse if they were also good political liars.
And now we come to Blankfein, who reveals the same character. He started out lying again about the Bailout, that it was only $10 billion from the TARP and that Goldman paid it back (Goldman’s real cut of the loot so far is over $50 billion and counting).
In Blankfein’s exchange with Levin, you can look in vain for B himself to provide any evidence of any productive function Goldman performs, how it contributes to humanity in any way.
B himself says they do nothing but run a casino and place bets:

Senator Levin and Lloyd Blankfein just can’t agree.

Like the exchange played out between the senator and Goldman’s chief financial officer, Mr. Blankfein and Mr. Levin volleyed back and forth, with their views miles away from each other.

Mr. Levin asks the question he’s asked over and over again. Should Goldman be telling its clients about its own positions? Is Goldman mistreating its clients by betting against them? Do you think clients should know if Goldman thinks something is a piece of junk (or a word more vulgar)?

Mr. Blankfein insists that Goldman is a principal. “The act of selling something is what gives us the opposite position of what the client has. If the client asks us for a bid the next minute we own it, they don’t,” he says.

It is the nature of market-making, he says, that puts Goldman on the other side of its clients’ bets. “What clients are buying or customers are buying is they’re buying an exposure. They are not coming to us to represent what our views are,” Mr. Blankfein says.

But the senator presses on. He thinks clients should know when Goldman is betting against them.

“You say betting against,” Mr. Blankfein says almost incredulously.

Kaufmann catches up B on the question, when did you know the mortgage market was going to collapse? B says he never knew, and that he had nothing to do with Goldman’s shutting down the “CDO warehouses”. B ends up having to say, “I think we’re not that smart.” (Picture Salazzo in “The Godfather”: “You think too much of me, kid. I’m not that clever.”) It’s the same old heads-I-win-tails-you-lose. We’re always told the “bonuses” are justified because of how “talented” all these cadres are. And certainly nobody on Wall Street is more talented than Blankfein, who now suddenly says the talent hype was all a lie, that he’s “not that smart”. So which is it? If they’re now admitting they have no “talent”, aren’t that smart, didn’t know what they were doing, surely they’ll be giving back all the bonuses?
At any rate, we certainly shouldn’t listen to any objections the day we’re able to claw back all of it, correct? Blankfein himself says so: “We’re not that smart”.
Kaufmann missed a bet here:

As the exchange continues, Mr. Blankfein points out that many financial companies lost tens of billions of dollars because of the sharp decline of the housing market. (Think Citigroup, Merrill Lynch, UBS — the list goes on.)

He should have retorted, “You mean ‘would have lost’ if the taxpayer hadn’t bailed you out.”
There’s more back and forth with McCaskill and Tester about synthetic CDOs. It comes through loud and clear that these are worthless, unproductive criminal scams.
It’s odd how many commenters on the econoblogs, even among those unsympathetic to Goldman, who scoff at the “financial illiteracy” of the senators. Illiterate they may be by quant standards, but at least in this forum they seem to be as literate as anyone needs to be. The only ideas and words you really need to describe any of this are fraud, con, scam, crime.
Yesterday’s exercise provided a demonstration of the mindset of pure, incorrigible, irredeemable criminals. They cannot be rehabilitated. The rackets and their cadres cannot be “citizens”. Wall Street and America are antithetical. Both cannot exist. One must die.
The only question is whether we’ll have the triumph of America or of Bailout America; whether we’ll live as human beings, or according to the whims of fraud, theft, robbery, bribery, and extortion. That’s the way it is today. But they’re adding serfdom, and soon they’ll enforce enslavement.
Today is the crossroads. Whether or not there’s to be any future at all is the decision. Let’s make sure we seize every opportunity like yesterday’s testimony, to drive the right decision.

April 27, 2010

Silly Season


Things are reaching quite the bizarre crescendo this week for finance “reform”. We have the regular crooks and the windmill tilters, and sometimes it seems exciting enough that I’m ready to charge a windmill myself.
Today Lloyd Blankfein will go before Congress to talk about Goldman’s political plight. (This is definitely a political matter as far as its real significance; even if the SEC is serious about its action, it’s doubtful that with these rigged laws Goldman will end up getting more than a wrist slap.) They’ve already issued some preliminary lies and nonsense, as dissected here and here.
Is it really possible that the SEC suit against Goldman will be the tipping point? That even the worst Democrats like Blanche Lincoln are feeling the heat to the point that they might even pass a quasi-reform rather than a pseudo-reform? This past weekend they even made a good adjustment in the derivatives proposal. They beat back arch-criminal Warren Buffett’s brazen attempt to carve out an exception for himself, which was enough to piss off Buffett’s waterboy Ben Nelson, who yesterday voted with the Republicans to cut off debate on the bill….
…and that brings us back down to earth. What I just said is probably nonsense, since the very fact that with 59 votes on paper (which not long ago was the filibuster-busting 60), and certainly more than 50 even with the possible defection of absolute villains like Nelson, the Democrats still refuse to go ahead and use their majority, either through reconciliation or by just getting rid of the filibuster altogether, proves that they have no will to real reform. At most, like Lincoln they’re politically trembling for November, as well they should be. But even with those political fears, they’re still only going to pander and engage in pseudo-reformist political theater.
Yes, for the moment the derivatives regs are headed in the right direction. But they still fall far short of what’s necessary – the complete banning of speculative derivatives, period. And, the existing House bill contains nothing but loopholes and scams masquerading under the name of “derivatives reform”. What kind of odds would Goldman offer if I wanted to bet on that eventual negotiation improving or gutting whatever the Senate comes up with?
And the bill doesn’t break up the big banks. Instead it wants to enshrine an allegedly new “resolution authority” which would really take its place alongside the existing PCA law which was violated and ignored in 2008 and 2009, and would undergo the same fate in the next crash. This is a scam plain and simple. Via the Kanjorski amendment it may even be a Trojan Horse designed to guarantee further bailouts, by enshrining a new “right” of insolvent, collapsing banks to demand judicial review of resolution seizures. Since such resolutions would have to be undertaken with speed, to let the bankrupt banks sue can only be intended to ensure that if an administration ever actually wanted to use the resolution authority, it wouldn’t be able to, but would have to cave in and agree to a bailout.
Also, the mechanism by which this bill is supposed to “guarantee” that the resolution won’t cost the taxpayers any money is a fund which will allegedly be collected from all “big” banks, meaning banks with “assets” of $50 billion or more. While that’s pretty big, it’s still extending the net far and wide for the benefit of just a few of the biggest rackets. As we saw with CIT, the government doesn’t consider $100 billion “too big to fail”. So why are they mining as low as 50 to help out the likes of JPM, BofA, and Citi? It’s obviously a pro-oligopoly measure, meant to harm mid-level competitors of the biggest rackets. (Not that I’m getting teary-eyed for the mid-size rackets, but we have to recognize what’s going on here.)
So this “resolution authority”:
1. Will not be used in lieu of bailouts. In the crisis they’ll simply ignore it, just like they did before.
2. Even if they wanted to resolve an insolvent big bank, it’s likely the bank could take legal action to stall, thereby forcing the bailout through disaster capitalist extortion.
3. Whatever motions they go through to collect monies from the rackets themselves to fund these bailouts will fall disproportionately upon the smaller rackets. So just as from the Bailout’s inception, so the continuation of the Bailout will have intensifying monopoly as one of its primary goals.
Overall the Senate bill is shaping up to be sham. Even if the derivatives regulation does end up being strong on paper, it’s likely to remain ineffectual if the derivatives market remains in the stranglehold of a handful of rackets. The bill doesn’t break them up, so they’ll instead break up anything worthwhile that’s in the bill.
It seems that for all their public whining, the banksters are on more solid ground in their laughter. The laughter suffuses their jolly e-mails crowing over the cleverness of their crimes.
And then they have their ever-reliable MSM errand boys to package their propaganda for them.

“Because of the origins and the impact of the global financial crisis, we have now entered an historical phase in which most industrial country governments will restrain banks through the wide use of regulatory, tax and enforcement tools,” he said. “People can debate for hours whether this should happen or not. The fact is that it will happen.”

This is part of the full court press, everyone playing his role in putting over the farce of “reform.”
And of course Sorkin himself:

While most agree that the system needs to be reformed, the worry, at least in Beverly Hills, is whether the reform will go too far — in contrast to the rest of America, where many feel the reform won’t go far enough.

What an odd term – “rest of America.” By that he means, America, period. I think any real American recognizes that Wall Street is an alien cesspool, and the finance globalists, to the extent that they’re nominal American “citizens”, are a cabal of traitors. They’re all enemies of the true American people.
But I suppose he’s telling a kind of truth there. To the finance gangster elite and their little flunkeys, Wall Street is the “real America”, and a hack like Sorkin probably thinks he’s being magnanimous in referring to the feral, filthy peasants, slated for serfdom, as “Americans” at all.
That’s the same mindset which is producing the Senate bill, which produced the House bill, and the health racket bill and so much else, and encompassing it all, the Bailout itself.
In the ideology of Bailout America, only the rich are citizens. The rest are economic cannon fodder. We who truly do comprise the real people, the real economy, any real chance of human community and well-being, must turn this lie upside down. We must recognize these gangsters and their servants as the stateless, as the rootless, as the useless, as the worthless. They’re not Americans, and they have no legitimate place in America. With their treason, their robbery, their vandalism, they’ve forfeit all such consideration.
They’re rabid dogs, and must be driven as such.

April 17, 2010

The SEC Sues Goldman

Filed under: Law, Reformism Can't Work — Tags: , , — Russ @ 2:05 am


Yesterday the SEC sued Goldman Sachs for civil fraud. The case centers on Goldman’s 2007 ABACUS CDO, which it manufactured at the behest of hedge fund predator John Paulson. The scam was for Paulson to cobble together a toxic mess of MBS he expected would blow up, find suckers to buy this CDO, and then short it. Goldman’s role was to launder the CDO as having been conscientiously constructed. They used the good name of a vetting firm, ACA. Goldman supposedly told ACA that Paulson was consulting on the MBS selection and would be taking the same side of the bet as the buyers would be.
Goldman then cited ACA’s imprimatur in touting this CDO to the suckers – pension funds, other institutional investors, dumber banks, the usual suspects. Meanwhile it helped Paulson really bet against what was really garbage. It collected fat fees every step of the way, including from the investors it defrauded.
(Barry Ritholz compares it to The Producers, who try to defraud their investors by putting on a crappy play they expect to quickly close while embezzling much of the loot.)
Typical of this feckless government, it’s only a civil and not a criminal indictment. Even if the SEC is serious this time (which I won’t assume until I see it), Goldman would still get off easy for capital fraud.
Of course the terrorist stock market struck fast, with the Dow plunging 125.91 points, the most in tow months and ending a week-long surge, to punish this nuisance to the banksters. The MSM rushed to defend the market. The NYT showed great compassion for the victims and fear for the future. “A relatively calm day turned turbulent” as those regulatory barbarians struck out of a beautiful spring sunrise.

Expectations are unusually high this quarter: investors are looking for an average of 38 percent growth in profit. Banks have driven much of the strength in the market over the last year, helped by a period of historically low interest rates that have made borrowing cheap.

But analysts worry the golden days for the financial sector may be limited if government investigators intensify their examination of risky trading practices. That may raise new questions about whether the broader momentum in the market can endure.

“What you’re going to go into now is a market that is very skeptical about the outlook,” Mr. Battipaglia said. “Whether this recovery continues or flattens out will be made clear in the weeks ahead.”

Even in the first moments of the indictment the first speculation was on how GS probably had a heads up and took positions to capitalize. Zero Hedge was asking how, not if, they must have shorted themselves. Sure enough, a few hours later there were more specific rumors. It’s likely that Goldman has committed every financial crime it was able to conceive every time it could, so it would be extremely out of character for them not to have engaged against insider trading against their own market image. After all, it would only be shareholders who took any hit.
If the SEC is serious about this, that’s fine as far as it goes, though we have to assume the least. When everyone parses the technicalities of this or the similar Magnetar trade, or any of an endless list of crimes, we get bogged down in counting how many angels were dancing on the head of a pin. What was technically a violation? What was a “crime” in the legalistic sense.
This misses the big picture that the rule of law has already long since been subverted. The law was hijacked to legalize many of the worst crimes. A corrupt Congress led the way, with such abrogations of the rule of law as the CFMA, which unleashed CDS into a lawless free-fire zone. Where it’s technically impossible for “crimes” to be committed, crime can run wild. That’s just one example of how the rule of law has been completely liquidated. Few financial crimes are clearly identifiable as crimes anymore, since the system is set up to allow them to use the very complexity which enables their cons to also legally whitewash them. Meanwhile “regulators” are generally compliant and often accessories.
That’s the whole point of rule by administrative decree. You first liquidate the law and replace it by the rule of unaccountable bureaucrats. Then you select the bureaucrats themselves according to their conformity with whatever gangsterism is the regime you really want to impose. Any rogues who actually want to work in the public interest are bullied, marginalized, or purged.
So in any particular case like this struggling to figure out the technical extent of the “crimes” is likely to be a fruitless effort. Even if the process goes through the motions of establishing a technical violation, there won’t be any real punishment. It’s political theater. Meanwhile the overall criminal regime continues unabated. It’s misdirection.
The reality is always that the finance sector is organized crime, across the board. The government and the MSM want us to think that Goldman may have committed an isolated de jure violation here, an aberration from its general pattern of legality, with technical legality being synonymous with moral legality and with what any human community would treat as legal.
But the truth is the opposite. Goldman Sachs and all of Wall Street is a criminal enterprise. All of its major actions are crimes according to any common sense measure of morality and rationality. These crimes have simply been illegitimately legalized by a hijacked system of law. Goldman’s crimes are not the aberrations, but rather the criminal trend itself, while its truly legal actions are there only for money laundering and political cover, just like with similar criminal syndicates like the Mafia.
Since we live in a kleptocracy, this government will never actually restore the rule of law and bring justice to these rackets. Even what shreds of legality still remain will only be rarely, meagerly enforced. That this anodyne indictment (not even criminal) has been greeted with such a bustle is a testament to what a vacuum justice has become. We shouldn’t lose sight of the big picture – the entire finance sector is criminal, and this legal system has been hijacked and will never be sufficient to solve the problem. If we sit around and wait for the likes of the SEC to set things right, let them set the pace and dictate the scope of what can be done, we’ll definitely remain serfs and eventually become slaves.
In the meantime, what’s the real purpose of this lawsuit? The immediate consensus is probably correct. It’s meant to put on a big political show, to make the Obama administration look good as part of the rollout for his finance “reform” bill. In the end Goldman will at worst get a slap on the wrist. (But maybe not even that -there’s always Obama’s cowardice, his propensity to cave in under the slightest pressure even the rare times he ever tries to do something supposedly in the public interest. It wouldn’t surprise me if he fails to follow through on even this paltry little traffic ticket. Look at what happened to his bogus “Volcker rule”.) Meanwhile they seem to be setting up the standard “bad apple”, in this case one Fabrice Tourre, the Goldman cadre who ran the ABACUS operation. Presumably Blankfein and the rest of the brass have plausible deniability. Ah, there’s that “rule of law” again….
So the administration is inviting Goldman to make the bad apple defense. They can get together to make a deal. They can scapegoat this bad apple, implicitly exonerating the Goldman brass. Goldman gets a slap on the wrist, Obama claims a big phony victory. That looks like the plan. (But like I said, watch for Obama to instead cave in.)  
(Meanwhile we can see another example of the government’s bad faith in that phony finance bill. They’re sure in need of propaganda help for it. Its centerpiece is looking to be the “resolution authority” scam. We can see the scam when we look at how this vaunted, robust “authority” would actually require court approval to be exercised. The Federal Bankruptcy Court would have to sign off on any resolution. That’s absurd on its face.
Even assuming the government ever actually wanted to “resolve” a collapsing big bank instead of bailing it out, which we should never assume, how are you supposed to do this when you’re melting down so fast that “by Monday we won’t have an economy”? All a bankrupt bank has to do is stall, fight the action in court, and the government will feel it has no choice but to cave in and bail them out.
That’s the intended outcome of the “resolution authority” scam. It’s designed to fail even in the unlikely contingency that the government really tried to use it.)
These are history’s worst robbers. We need to stop obsessing on the scam “legalities” and develop a fully political consciousness and attack. Sure, when there’s a particular example like this, we can have fun with parsing it – but only and always within the broader context that this is part of a political war. Don’t let the government, the banksters, or myopic commentators frame it as: “Let’s see if they got caught in a technical violation. That’s the extent of culpability here. The burden of proof is on the accuser to prove his case according to the technicalities. If this fails, that signifies innocence.”
That would be the equivalent of a Russian in WWII having to prove in any particular case that German invaders were committing a technical crime.
The right way to look at this case, or any case like it, is “So for once you’re claiming you’re going to apply your law to one of these crimes? Refreshing. But we’re not going to let you fool us. We’ll believe you’re serious about justice when you restore real laws which criminalize all finance crimes. Until then this is all a scam. We’re not going to wait for a day that will never come. We’ll seek to redeem the law on our own.”

September 15, 2009

Two Speeches, One Policy

Another week, another speech. Another year, another unfolding disaster.
We saw quite a contrast yesterday between two opposed philosophies on what public service is supposed to be about, and what America is supposed to be about. Judge Jed Rakoff finally said he’d had enough of the criminal collusion in his court. The case is over how Bank of America lied to its shareholders about its pending deal to buy Merrill Lynch, promising that there would be no “bonuses” paid at Merrill. In fact they already knew that $3.6 billion in bonuses were all set to go. Under pressure from defrauded Bank of America shareholders, the SEC felt constrained to bring an action against BofA, which the collaborating parties agreed to settle for a slap on the wrist and no admission of wrong-doing. Corporatism in action. All the bigshots are happy, and everyone can get back to business as usual.
Just by accident, this case landed in the court of a judge who actually takes his job seriously. He repeatedly denounced the settlement as a whitewash and demanded more answers. He demanded to know who was personally responsible for this crime. BofA tried to claim that its executives never made any decisions, but only obeyed the advice of lawyers. But in order to maintain their client-attorney privilege they laundered the lawyer story through the SEC brief. So “both” sides agreed, no one in particular could be held responsible.* When the litigants (that is, the defiant defendant and its flunkey “prosecutor”) finally were reduced to insulting the court’s and the public’s intelligence in this way, Rakoff had enough. He rejected the settlement and ordered them to prepare for trial.
Everything the judge wrote sounds downright quaint. He said the settlement was “not fair”. He demanded to know where “justice and morality” have gone, where personal responsibility. He was especially incensed that even the token $30 million fine in the settlement would have been paid not by the executive wrongdoers, but by the very shareholders who were defrauded.
It’s a good bet that everyone on Wall St and in Washington today are scratching their heads over this decision and its language. It doesn’t make any sense to them. The words are familiar enough; we hear them all the time in politics. But what’s up with this action which seems to indicate that this guy actually means something by those words?
Luckily everyone could relax and listen to some similar words in a more familiar way, when Obama went up to Wall St to say something about financial reform. Here everyone could expect the same platitudes and bluster as in last week’s health reform speech, equally contradicted by his every action. He didn’t let them down. (Of course as the psychopathic louts they are they couldn’t even pretend to feel remorseful, even as an exercise in political tact. That’s how confident and incorrigible they are.)
“We will not go back to the days of reckless behavior and unchecked excess at the heart of the crisis.”
Just as with health care, this rhetoric is belied by this administration’s policy. From day one, and indeed going all the way back to the campaign, Obama has supported the massive redistribution of wealth from the people to the finance racket. He has done all he can to facilitate this conveyance, through bailouts, loan guarantees, loan “facilities”, maintaining illegal secrecy about these disbursements, and generally flooding the system with cash in order to prop up phony values on the stock market and on bank balance sheets. They call this “quantitative easing”, and it certainly does make it easy to pretend we’re “recovering”, even as the debt-hallucinated “wealth” of the middle class vaporizes like the hologram it has long been.
Meanwhile the very real jobs America used to enjoy have been permanently destroyed. They will not come back under this system. Even the propagandists are forced to call what they’re peddling a “jobless recovery”. Except that the phony mortgage bubble recovery following the early-2000s recession was already the start of a permanent jobless death march, which itself was the intensification of a forty year trend of eroding wages and concentration of wealth. The financialization of the economy was dialectically both a cause and effect of this increasingly social Darwinist economy.
Obama says they can’t commit the same crimes “and expect that next time, American taxpayers will be there to break their fall”. This is a flat out lie, because everyone knows Too Big to Fail is now officially enshrined American policy. Every aspect of Obama policy, simply following through on Bush policy, contradicts this lie and promises that in the inevitable future crashes the bailouts will be repeated. The entire sector, and by extension the business class, are structuring around this promise.
Indeed there’s no reason to believe the bailed-out banks will ever again be anything but wards of the lemon socialist state. Although Goldman and JPMorgan and a few others “paid back” the TARP money with much fanfare and administration self-congratulation, this was only a small portion of the bailouts. Trillions remain outstanding; nobody outside the Fed or government knows how much or held by whom, since the administration has tyrannically kept this information a secret from the very taxpayers whose money is being looted.
For this reason Congressman Brad Sherman, one of those who voted against the TARP last fall, raised a protest after yesterday’s speech over the provisions of the administration’s proposed systemic risk plan, which would, reminiscent of its health care proposal, require a large number of institutions to pay into an insurance fund which would offer benefits to only a handful of privileged big banks. As usual, the mass of small players must bear all the costs and losses of the big rentiers, who rake in all the profits. Sherman condemned it as “TARP on steroids.”
We can only wish that protest like this could lead to another kind of Progressive Block. 
This taxpayer bailout promise is summed up in the sardonic term “Bernanke put” (AKA Geithner put, back when they were attempting a more direct loot conveyance through the PPIP; today it’s more through the Fed’s quantitative easing)
This term can encapsulate the entire Obama economic ideology and policy, which is simply an extension of the longstanding corporatist ideology and policy.
So this economy is both mean and predatory in general, and has become permanently unstable and prone to crisis and crash as well. There is no longer any real, stable basis for this economy. It’s now a permanent casino, dependent upon the bubble and crash, boom-bust cycle.
This is the economy as dominated by the finance sector. It’s an economy of, by, and for the bankers. A government policy which is dedicated to sustaining this casino is as pure a distillation of corporatism as is possible. This is truly the end stage of monopoly finance capitalism.
Obama’s government has dedicated itself to this casino barker role. It has done nothing to restrain the “recklessness” and “excess”; on the contrary it has enshrined it as the core quality of America.
All American policy now emanates logically from this racketeering core. Every other racket, and even the legitimate businesses, are arranged according to their logical places in the financialized structure. All other policies stand or fall according to whether they fit in with this logic.
Thus with health care reform, since the combination of individual mandate-phony regulation confirms the loot flows along the chart from people to insurers and up to banks and bank shareholders, this is anointed as not only the correct policy but the only policy in the eyes of the feudal nexus of corporation-government-mainstream media.
Meanwhile since single-payer or a real public plan make no corporatist sense, they are beyond consideration. Establishment Democrats and the MSM treat a public plan as a stupid whim on the part of romantics, while single-payer is so alien as to not even be deemed a fit topic for conversation. Even the progressives are wobbling: are we really going to stand against the entire logic and vote against its result?
I guess the answer boils down to, is it really just a whim on the part of those who are system players at heart? Or are they true progressives, who have no choice by now but to become rebels vs. this system?
Where you see anyone say, let’s cave in again, but we’ll get ’em next time, you have your answer.
So it has been so far with pretty much everyone vis the big banks.
[* This Kafkaesque idea of saying “the lawyers told him it was OK, so we can’t prosecute him”, while the lawyers can’t be held to account at all since they were simply giving professional advice for which they take no responsibility, seems to be popular with the Obama people. It’s also Eric Holder’s preferred way of dealing with the Bush administration’s war crimes.]