Why The Two Thousand Page Financial Reform Bill Of 2010 Is A Poster Child For Massive Political Fraud And Corruption Comparative To The Two Dozen Page Bill It Replaces. Politicians Have Systemically Corrupted Our Government To The Point That We Cannot Trust Anything They Do Without Complete Transparency And Oversight.
"Secret diplomacy is a necessary tool for a propertied minority, which is compelled to deceive the majority in order to subject it to its interests. Imperialism, with its dark plans of conquest and its robber alliances and deals, developed the system of secret diplomacy to the highest level."
– Leon Trotsky, 1917
What has the world come to that I am quoting Trotsky on here? 1917 was a very interesting time in Russia. There was great concentration of wealth and an illegitimate and imperialist government which perpetuated this dynamic through fraud and tyranny. Interestingly, the government that replaced czarist Russia was even more illegitimate and barbaric. There are some timeless parallels to the illegitimacies of the state regardless of when and where they exist. I ran across Trotsky’s remark and thought it would be a perfect opening to the ‘secret diplomacy” that similarly defines the 2010 financial reform bill here in the U.S.
On to the post.
Some months ago, I said we would take a very unique look at the fraud of the Wall Street reform legislation that the President signed this year. We will focus on the measurable outcome of corruption rather than the specific contents of the bill. This is substantially more rational than attempting to analyze a bill which is too complex to actually analyze. On some level the contents of the bill are completely irrelevant. The bill is so complicated that no single person can do an effective analysis. It would take a century to interpret every single page of code and litigate the countless interpretations of legalese for each of its pages. If this bill stands as it is, that is exactly what is going to happen. We have a legal system where special interests challenge law over and over until they find a pliable judicial system to see their interpretation. Then when special interests or corporations finally get what they are able to manipulate or defraud, they’ll move on to a new piece of the code. That’s what has happened with banking regulations, Glass-Steagall, Medicare, food safety, trade bills and on and on. Why would the new financial reform bill be any different when the rules to the game have not changed?
A reader remarked about the time of the passage of the financial regulation bill that maybe our economic system had become too complex. Well, that surely is not the case. Contrarily, the American economy has become substantially less complex over the last thirty years or so and that is at the core of its weakness and lack of vibrancy. (Something for you to ponder.) But, in parallel, during that time, government has become substantially more complex. Too complex. And so has our federal code which is now well beyond one million pages.
How does anyone really understand the rule of law with over a million pages of legal code and thousands more being added by our new President and the Democratic Congress?
I heard a Harvard law professor (an honest and distinguished one) once remark that the law should be easily understood by everyone in society without the aid of a lawyer. That the rule of law was for everyone in society regardless of class or accomplishment.
No one understands the rule of law in the United States any more. That includes the legal system itself. So, instead with so much excess and unnecessary code, the application of the rule of law becomes arbitrary. ie, No enforcement agency could ever hire enough people to enforce the overly complicated codified code of the United States. So, enforcement becomes arbitrary and random. This leads to a less than equal society and a bastardization of democracy. It has the exact same effects on our economy. It leads to abuse where arbitrary enforcement will be focused on what is important to the state. And that often means application to enemies of the state. Especially when the state is in a mode driven by fear and paranoia as it is today.
e.g., While Wall Street gets away with the crimes of the millennium due to the arbitrary lack of enforcement of the rule of law, middle class and underprivileged Americans are booted from their homes or left in food lines using the arbitrary enforcement of the rule of law. In other words, with limited resources of investigation and prosecution, the state has arbitrarily chosen to apply those resources to indict and prosecute the ‘We The People ‘side of the housing debacle coin while it also arbitrarily chooses not to apply its limited resources to prosecute the criminal Wall Street side of the same coin. And why is that? Because arbitrarily applying the rule of law to ‘We The People’ in lieu of Wall Street is a profitable endeavor. We The People are the enemy of the state. Wall Street is a tool of the state.
Regulations (society’s rule of law applied to the economy) are necessary for any functioning economy just as the rule of law is necessary for any functioning democracy. Regulation should be simple so that all interested economic participants are able to effectively compete in the market with a clear understanding of its rules. (Just as code should be simple in support of democracy for the same reasons.) i.e., No party is allowed to dump mercury out the factory’s back door. No ifs, ands or buts. And here is how you must dispose of that waste. Not a 100 page litany of exceptions and special situations put into the code by major corporations bribing our government for their benefit of cheating or advantage or stifling competition.
The government is the referee in the game of economics. Regulations are the rules to the game. Economics can be defined strictly and often mathematically, not using political ideology. That some people wish to apply libertarian political philosophy to economics is insane. You don’t apply political ideology to the rules in a baseball game any more than you would to the economy. Political ideology applied to markets is the very reason we have a nonfunctioning economy. Neoliberalism is in many ways the adoption of libertarian economics. In other words, get the government out of the regulation business and let the markets decide is substantially ridiculous. We don’t play baseball without rules. Yet that is often the basis for policy driven by corruption. What we need to do is get the government out of the rigging markets or rigging the game business for monetary favors. This is necessary for the game to function under fair rules where anyone with a legitimate business idea or plan can play the game and win.
But we really don't have a functioning democracy in Washington. So, instead of necessary regulation, we get red tape that is defined by big business lawyers and lobbyists who write legislation determining our economic policy. And that regulation always includes special provisions for those willing to pad the pockets of politicians. Unlike politics, markets can be based on mathematics. Something the political class clearly doesn’t understand nor care to understand. We all know Wall Street wrote much of the financial reform legislation. It was reported without question during the reform process.
Economic models should be based on reason. On concepts that can often proven to work under some modicum of science and rationality. There may be more than one valid perspective on functioning markets but political ideology isn't one of them. And neither is the red tape we call regulation provided by corporate lawyers whose goal is to stifle competition and rig the game in their favor. Remember, we are adamantly not pro-business on here as our government is. Not one iota. We are pro-markets. Pro-markets ideals can be made to align with democracy. Pro-business aligns with corporatism or fascism that we see today.
Courtesy of our government, the dynamic we have in our economy is the same dynamic involved in Wall Street’s endless rigging and manipulation of financial markets as highlighted in the last post on derivatives. Our economy is rigged. Countless tens or hundreds of thousands of pages of worthless code inserted into our rule of law by bribes and special interest favors for corporations.
The American economy is choking on its on vomit because of Washington politicians. Washington is both the problem and the answer. Fix Washington and the American economy will be just fine. Or don't fix it and watch it continue to collapse under the weight of corruption and ignorance. Just like the Soviet Union did.
Now let’s get specific as it pertains to the 2010 financial reform bill. Unfortunately, it appears to me the Federal Reserve has removed the original 1933 Glass-Steagall bill from its web site. You know, the one put in place to thwart Wall Street’s corruption that helped create the Great Depression. Or, at least I cannot seem to find it anymore. I looked everywhere on Federal Reserve sites. It was once readily available. But after this crisis unfolded, my link to the document disappeared. Maybe the document is still out there and the link was moved innocently. But this raises issues in my mind as to why. Especially since a very small minority in Congress were lobbying to restore Glass-Steagall against the overwhelming Wall Street lobbyist machine telling us it wasn’t a) part of the problem and b) feasible. Both are lies that are killing our economy and our democracy. Did Wall Street not want Americans to see the bill they spent untold millions, if not billions, to have overturned when it came to forming new financial reform legislation in 2010? Who knows.
Anyway, I have a personal copy of Glass-Steagall. And here is also a fine bit of corrupt legislation in the form of Senator Dodd’s 2010 financial reform bill to compare and contrast.
Do you see any difference? Well, one is the readability factor. Good luck making heads or tales of the 2010 bill. The 1933 bill was simple and concise. Easy to read by anyone with a basic grasp of language. It provided reasonable rules which economic participants could understand without a legion of lawyers.
There is an even bigger difference. A very,very,very profound difference. Glass-Steagall is two dozen pages and the 2010 financial reform bill is going to be two thousand pages by the time it is put into final law. (The 2010 bill’s contents and regulations haven’t actually been finalized since it was corruptly ramrodded through passage before completion. It probably won’t be complete for many more years. So the bill will continue to grow in scope and corruption.)
We can safely interpret the complexity and scope creep of the 2010 bill over the Glass-Steagall bill. That is, every page beyond the original two dozen pages of Glass-Steagall is a page of Wall Street special-interest complexity paid for by bribery and corruption. Complexity, just like in the derivatives market, creates a murky environment understood only by those who create and manipulate it. That lack of transparency is necessary to keep out competition and perpetuate massive profits achieved through outright fraud and corruption. Glass-Steagall was based on the simplicity of honesty and a functioning market. Anyone could understand it and adhere to it without a legion of lawyers. The 2010 financial reform bill is based on thousands of pages of special interest-written legislation bought and paid for by corrupt lobbyists and the most corrupt financial system this country has ever seen. You tell me, how is anyone other than the mega-rich large corporations who wrote this toxic trash able to compete when there are two thousand pages of bullshit, loopholes, unnecessary complexity and legalese meant to benefit the most corrupt - the criminal monopolies of Wall Street? They can’t. They won’t. And that’s exactly the point of this complex deceit.
Wall Street has used this legislation to tighten the noose on democracy and working markets. This financial reform bill has further rigged markets in the favor of those who can “pay to play” while providing the complexity, lack of transparency and barriers to entry they need to continue to rig markets. That very fact was highlighted in the New York Times article in the last post we put up on derivatives. The financial reform of 2010 was a bald-faced lie courtesy of the Washington Democrats and President Obama. Of course the Republicans are actually worse. They didn’t want any reform. They were too busy begging Wall Street for political donations.
If our banking system was the envy of the world before special interests started bribing our government with billions of dollars to dismantle or rig the regulations around it, and the core of that regulation was two dozen pages, what does it now say that we have a new financial reform bill that is thousands of pages in length and too complex for any newly interested or small business on the outside to even understand? What it tells us is that every single page of this code is something inserted by a cartel banking system to maintain its corrupt control over our government and our society. The voluminous length of the 2010 financial reform bill is a testament to the extent of its massive fraud.
This regulation keeps competition out of the financial markets and guarantees a handful of firms maintain control while they continue to rape and pillage our society. Democracy? Are you kidding? This financial reform legislation is simply a noose on the neck of competition and the American people that now chokes even tighter. It is bought and paid for guarantees, bribes, loopholes and special dispensation for the privileged few. This new “reform” bill will guarantee there will never be change or never be competition to the corrupt cabal that is Wall Street. All courtesy of your friendly pro-business (aka fascist) government. Corporate personhood is the bane of humanity. It is based purely on corruption and-or failed political ideology of our Supreme Court.
Do you believe this is simply a problem with our banking system? It is a problem with every single industry in the United States. Our federal government whores itself out for legalized bribes and then restricts competition or rigs markets or sells out our federal government for money to corporations and foreign governments.
Food, technology, computers, textiles, transportation, chemicals, financial services, banking, insurance, energy, housing, healthcare, media, military. It doesn’t matter what the business. They are all rigged. All markets are rigged in our economy. There are a handful of firms in every business vertical that maintain a tight control on competition and red tape through government bribery. And they are all rigged to reduce competition and, therefore, job creation, new business creation and economic opportunity for We The People.
Who works on your behalf to rig economic markets in favor of We The People? ie, Democracy? No one. So what do we see in its place? Widespread underemployment, unlivable wages, denied access to affordable health care, incredible poverty, despicable education for underprivileged, no help for parents with special needs children, racism, class warfare, mortality rates for many segments of the population similar to undeveloped and massively corrupt countries and on and on and on. The stench is unbearable and unmistakable.
Eventually, we know what happens to rigged markets, don't we? They collapse. Just like countless other Wall Street scams have collapsed. The same reason the stock market is going to collapse again. Competitors either can't or refuse to participate. Monopolies of power are built. Power-seeking stooges rise to the top and determine the future of opportunity based on cronyism rather than merit. Wealth is concentrated into the hands of a few bureaucrats who invariably prize power and control over democracy, virtue and integrity. The true believers defend a completely failed system with tremendous zeal and rationalizations. The head grows larger as the body withers. Humpty Dumpty either comes crashing down or is dismantled by those with the jackboot of tyranny upon their neck.
This story has been repeated a thousand times throughout history.
Intel, BP, Microsoft, DuPont, JP Morgan Chase, Exxon Mobil, AIG, HP, Cisco, Monsanto, Oracle, IBM, GM, Ford, Citigroup, Goldman Sachs, Wal-Mart, Bank of American, the Robber Barons of yore, the Chinese communist party, the Republican and Democratic parties, the overlords of the former English empire, the ayatollah's in Iran, the Third Reich, Imperial Japan, the Euro zone, feudal middle-age Europe, the Soviet Union, Ancient Rome, the Federal Reserve, the military-industrial complex and of course a bought and paid for U.S. federal government. All were examples of monopolies run by power-seeking stooges who relied on cronyism and corruption for their power rather than deriving it from moral clarity, legitimacy and justice.
"Sometimes the law defends plunder and participates in it. Thus the beneficiaries are spared the shame and danger that their acts would otherwise involve. But how is this legal plunder to be identified? Quite simply. See if the law takes from some persons what belongs to them and gives it to the other persons to whom it doesn't belong. See if the law benefits one citizen at the expense of another by doing what the citizen himself cannot do without committing a crime." -- Frederic Bastiat
Our government takes from We The People and gives to special interests, foreign governments and corporations. And they do so under the influence of money and monetary favors. Law does not govern our society. Neither does democracy. Men rule as kings and queens and we are their serfs. But our minds are free - they can never force us to support a system of corruption. And that will contribute to their ultimate demise. And all of the corporate welfare recipients will eventually end their reign of economic terror with it. Just as it has throughout history. A fish rots from the head first. Or as we have said countless times, we are living through the end times of big.
The rule of law has simply become something to whore out for personal favors by endlessly corrupt and power-hungry politicians. And elites outside of the government are more than happy enough and corrupt enough to oblige. Do you think either care about democracy? The 2010 financial reform bill is a perfect example of that fact. The 2010 financial reform bill praised by President Obama is simply 2,000 pages of bought-and-paid-for red tape that rigs the game even more in the favor of crooks and liars.
And by the way, so is the healthcare reform bill of 2010 for the very same reasons. All we needed to do was extend Medicare to any American who was unable to find affordable health care. And then we could have told those in the top 1% wealthiest Americans that until these Americans can afford health care with a living wage, you are going to pay for their health care bills. Given these are the people who have corrupted our government, they have the control and power to create policies which offer a living wage and economic opportunity to all Americans. Extending Medicare would have been a twenty page bill. Not the monstrosity of 2,500 pages of corruption and the forced for-profit corporation tax on poor Americans that was eventually passed.
Everything the government touches under the influence of bribery by the lobbyist bubble is tainted and rigs the system in some way. There can be no restoration of economic rights, democracy and the legitimacy of representative government over the tyranny of the state until the stench emanating from Washington is completely removed. There is no recovery. Only lies and deceit.
Corporate personhood and the comingling corruption it has created must be put to death and done so constitutionally.
The future is going to look nothing like the past. That’s a very good thing. Not so good if your desire is power and control. The world’s institutions and deceits that are projections of the ego are crumbling right before our very eyes. It’s good to be the king. Not much longer though.
<< Home