While everyone was watching the artificially hurried and rigged vote on Health Care, the issue of financial regulation slid under the radar. The importance of this cannot be minimized of exaggerated. When this president took office, we were in one of the worst recessions in history. We pretty much still are. A recession triggered, in large part, by misbehaving banks, disingenuous investment firms and lazy, incompetent (and possibly corrupt) regulators.
Once the cause of Health Care took center stage, that freed up the Senator from banking land - the ever untrustworthy Chris Dodd - to quietly push his bogus financial reform package. And it freed up his Republican counterpart - the earmark loving Shelby - as well.
The financial press took their eye off this as well in their haste to cover Health Care. This freed up everyone to have some fun at our expense. Blankfein, Dimon, Pandit and the rest took the opportunity to manipulate the process to ensure that any new regulation would actually be the same as the old ones.
Let me be very clear on one point. With a few exceptions (Ken Lewis comes to mind) most of the banks and investment firms acted barely within the law in their endless gaming of the system to make sure that they profited from our losses. And today brings more proof that the Congress in their haste to send a trillion of our dollars to Wall Street did so with no regard for the taxpayer.
Today we read that Dimon's firm - JP Morgan - having been gifted Washington Mutual and Bear Stearns by the troika of Geithner, Paulson and Bernanke can now get a massive tax refund thanks to some little known and rarely mentioned provisions in Obama's so-called stimulus package. The package that was supposed to get our economy up off the mat. The other trillion taxpayer dollars flung down the corrupt rabbit hole maintained by the Pelosi-Boehner gang.
It seems that a minor little tiny piece of that legislation allowed the banks to move their losses around to cover profitable years, thus reducing their tax burden. Something that nobody commented on at the time. Something that the deficit hawk Republicans failed to point out as a cost of the legislation. Something that the tax-happy Democrats failed to mention. Nothing from CBO either.
To be fair, the law was written by Congress and the real pirates of this time - Dimon and friends - followed it. One can only assume that they paid their pet Congress Critters to write it in there, but it passed and was signed without a single mention in the press. No objection from the White House. Not a peep from Barney Frank or the ever untrustworthy Dodd. Not even a flinch from the false queen Nancy the last.
In fact, I think I can easily say that the only time those clowns are bipartisan is when they are acting in secret to help their lords and masters on Wall Street.
You can be sure that Dodd's proposed new regulatory scheme will be the next fast track piece of nonsense coming off Capitol Hill. And this one will be high grade nonsense.
The minute the Lehman report came out, all such legislation should have been stopped. Frozen. Put on hold. After all, it only makes sense. Here we have proof of how the system was being gamed. It would make sense outside Washington to investigate those abuses and see who else is playing the game. Take a serious look at what is really needed.
The first course should have been to call Geithner down to the hill for a public hearing on just what he was doing while he was failing in his job as New York Fed CEO and principal regulator of the Wall Street banks. Then Bernanke to demand he reveal just how much money he handed out and to whom while he was failing in his job as Fed Chairman. Then Paulson to ask the same questions.
None of this happened. In fact, both parties in Congress have done everything they can to ignore it. Rather than actually find the facts and act on them, Congress persists in acting to please pollsters and pundits while actually satisfying the special interests that fund them.
This is sure to become the next partisan football kicked around. Democrats will clamor for more regulation and new agencies while Republicans will cry about too much regulation and too much government. And this once, both will be right and both will be wrong.
We already have reams of regulation but no regulators willing to enforce them. Witness the always untrustworthy Mary Schapiro, now head of the SEC. She had the raw nerve to complain that regulators did not do their jobs. Yet, she was one of them as FINRA head. Her agency ignored things like Madoff and allowed the endless trading of credit default swaps and exotic derivatives.
Yet, there she is, now head of the SEC. Somehow, this administration took her failure, Geithner's failure and Bernanke's failure and accepted them. Even promoted them. And this sham of a Senate confirmed them into their jobs. That should tell all of us what the Senate cares about. Nothing. Except themselves.
There are no less than 7 agencies currently charged with enforcing tens of thousands of regulations. Most likely a hundred thousand federal employees or more. Add in the states and their laws. We have plenty of law, regulation and enforcers at all levels. Just none of them are any good.
Now ask, do we need more law or clearer law? Do we need more enforcers or active, effective enforcers? Does the Fed really work anymore? Who supervises them? Who are these bond rating firms? Are they ever reviewed? By who? And a lot more really obvious questions like that. The ones neither Democrats or Republicans ever seem to ask. I don't care how much profit Wall Street makes. I care that they do so within the rules.
I challenge this president to appoint a non-political commission to openly investigate the banks. None of the circle currently dining at the White House. No power brokers or lobbyists. No cronies or hacks.
I say we give it over to Elizabeth Warren and Eric Bolling. They understand how Wall Street works and how the laws work. Take it away from the partisan grindhouse and have an actual open, transparent investigation. Force the Fed to keep Bernanke's false promise of transparency. Force Geithner to keep Obama' promise of the same.
One thing I am confident of with both Dr. Elizabeth Warren and Eric Bolling is that they will keep the best interests of the people in mind. These are 2 ethical, honest Americans, who care because they love this nation. Neither of them aspires to power. And both know a lie when they hear one.
When their Commission issues its report, then Congress can look at regulation. If any of them are not being investigated themselves.