DEAR BUBBAS AND BUBBETTES,
“When you are too big to fail, you apparently also become too grand to jail”.
When you finish reading this provocative article, please also take a look at the book reviews below of an enticing new opus by Glenn Greenwald.
It is hard to grasp how profoundly our system has now been perverted by those with mega-budgets which not only buy them such enormous power, but also such incredible legal impunity too.
It is shocking and dismaying because the scale and scope of reform that will be required to try to get back to a real function republic is so enormous today.
Yet hope springs eternal!!
WHY GOLDMAN SACHS, OTHER WALL STREET TITANS ARE NOT BEING PROSECUTED
The Justice Department's decision not to prosecute Goldman Sachs in a financial-fraud probe is another sign of the cronyism that has kept Attorney General Eric Holder from taking action against other big Wall Street firms, says Peter Schweizer.
By Peter Schweizer, The Daily Beast, 14 August 2012.
On Thursday the Department of Justice announced it will not prosecute Goldman Sachs or any of its employees in a financial-fraud probe.
The news is likely to raise the ire of the political left and right, both of which have highlighted one of the most inconvenient facts of Attorney General Eric Holder’s Justice Department: despite the Obama administration’s promises to clean up Wall Street in the wake of America’s worst financial crisis, there has not been a single criminal charge filed by the federal government against any top executive of the elite financial institutions.
Why is that? In a word: cronyism.
Take Goldman Sachs, for example. Thursday’s announcement that there will be no prosecutions should hardly come as a surprise. In 2008, Goldman Sachs employees were among Barack Obama’s top campaign contributors, giving a combined $1,013,091. Eric Holder’s former law firm, Covington & Burling, also counts Goldman Sachs as one of its clients. Furthermore, in April 2011, when the Senate Permanent Subcommittee on Investigations issued a scathing report detailing Goldman’s suspicious Abacus deal, several Goldman executives and their families began flooding Obama campaign coffers with donations, some giving the maximum $35,800.
That’s not to say Holder’s Justice Department hasn’t gone after any financial fraudsters. But the individuals the DOJ’s “Financial Fraud Enforcement Task Force” has placed in its prosecutorial crosshairs seem shockingly small compared with the Wall Street titans the Obama administration promised to bring to justice.
Will bipartisan outrage boost the decibels in D.C. loud enough for Holder to hear and heed?
Consider the following small-time operators as listed on the Financial Fraud Enforcement Task Force website :
• “Three Connecticut Women Charged with Overseeing ‘Gifting Tables’ Pyramid Scheme.” Three women in their 50s and 60s were indicted for conspiracy, tax, and wire-fraud charges. “These arrests should send a strong message to all who threaten the financial health of our communities,” one federal agent declared.
• In March, 2012, the DOJ sent a property appraiser in Washington, D.C., to the slammer for 65 months for fraudulently inflated prices in a scheme to “flip” properties. The scheme was a small-time $1 million operation, a sharp contrast with the billions on Wall Street.
• The DOJ’s “get tough” on financial crime strategy included sending two health-care software company executives to the clink for 13 and 15 years.
• A Florida resident was charged and sentenced to 14 months in federal prison for falsifying documents, thereby resulting in the obstruction of an SEC investigation.
• Five people in California were charged with bid-rigging foreclosure auctions. The individuals have been charged with violating the Sherman Act and could face up to 10 years in jail.
• Federal officials went after 10 people in Las Vegas because they tried to “fraudulently gain control of condominium homeowners’ associations in the Las Vegas area so that the HAOs would direct business to a certain law firm and construction company.”
• The owner of a Miami company got 46 months in prison for creating fake loan applications.
• Four people in Tacoma, Wash., were indicted for conspiracy that caused a small bank to fail. Their crime: making false statements on loan applications and to HUD.
To be sure, financial fraud of any kind is wrong and should be prosecuted. But locking up “pygmies” is hardly the kind of financial-fraud crackdown Americans expected in the wake of the largest financial crisis in U.S. history. Increasingly, there appear to be two sets of rules: one for the average citizen, and another for the connected cronies who rule the inside game.
That could be changing, as critiques of Eric Holder’s lack of financial prosecutions have now come from the political left and right; indeed, battling cronyism may represent one of the rare points of common ground in today’s fractious political environment. As progressive Richard Eskow of the Huffington Post recently wrote:
“More and more Washington insiders are asking a question that was considered off-limits in the nation's capital just a few months ago: Who, exactly, is Attorney General Eric Holder representing? As scandal after scandal erupts on Wall Street, involving everything from global lending manipulation to cocaine and prostitution, more and more people are worrying about Holder's seeming inaction—or worse—in the face of mounting evidence.”
Will bipartisan outrage boost the decibels in D.C. loud enough for Holder to hear and heed? We’ll see. He’s got at least three months to get moving.
“With Liberty and Justice for Some”: How the Law Is Used to Destroy Equality and Protect the Powerful
By Glenn Greenwald
Metropolitan Books; First Edition edition (October 25, 2011)
Glenn Greenwald is the author of the New York Times bestsellers How Would a Patriot Act? and A Tragic Legacy. Recently proclaimed one of the "25 Most Influential Political Commentators" by The Atlantic, Greenwald is a former constitutional law and civil rights attorney and a contributing writer at Salon. He lives in Brazil and New York City.
From "the most important voice to have entered the political discourse in years" (Bill Moyers), a scathing critique of the two-tiered system of justice that has emerged in America
From the nation's beginnings, the law was to be the great equalizer in American life, the guarantor of a common set of rules for all. But over the past four decades, the principle of equality before the law has been effectively abolished. Instead, a two-tiered system of justice ensures that the country's political and financial class is virtually immune from prosecution, licensed to act without restraint, while the politically powerless are imprisoned with greater ease and in greater numbers than in any other country in the world.
Starting with Watergate, continuing on through the Iran-Contra scandal, and culminating with Obama's shielding of Bush-era officials from prosecution, Glenn Greenwald lays bare the mechanisms that have come to shield the elite from accountability. He shows how the media, both political parties, and the courts have abetted a process that has produced torture, war crimes, domestic spying, and financial fraud.
Cogent, sharp, and urgent, this is a no-holds-barred indictment of a profoundly un-American system that sanctions immunity at the top and mercilessness for everyone else.
A BOOK REVIEW
A SCATHING INDICTMENT
By Tiger CK, October 2011.
In With Liberty and Justice for Some, Glenn Greenwald, a former civil rights litigator has produced a troubling indictment of the American justice system. His basic argument is that the system really has two tiers--one for the elite, who can often escape prosecution for serious crimes and another for the rest of us. The law, he argues, no longer creates a level playing field the way the founders of our constitution intended it to. During the last several decades in particular, the powerful have used the law as a weapon against the poor and the weak.
In a tightly written narrative, Greenwald covers how the law has been used to favor what he calls political and financial elites since the 1970s. He begins with President Ford's decision to pardon Richard Nixon despite his egregious crimes against the constitution and carries forward to the present day. Neither Republicans nor Democrats are spared. He is critical of the worldwide torture and doemstic spying that occurred during the administration of George W. Bush. But he also criticizes Obama for failing to prosecute both former members of the Bush administration and the financial elite on Wall Street.
The book is divided into five sections. The first covers the origin of elite immunity and talks about how the problem of inequality first developed in the public sector. The second covers the spread of elite immunity to the private sector including Wall Street. The third section entitled Too Big to Jail deals with how many on Wall Street and in the banks have escaped prosecution. The fourth entitled Immunity by Presidential Decree deals with presidential pardons; and the final section on the American justice system's second tier deals with how the system works for non-elites.
Greenwald's book is a passionately written one. The pages seethe with the author's moral outrage at the inequalities that exist within the American justice system. And the book will not fail to provoke the same sense of anger in the reader. Some of the problems that Greenwald points to really are inexcusable in a prosperous and democratic society and the author rightly argues that we need to find a way to address them.
I have given this book a high rating because it definitely forced me to rethink some of my fundamental assumptions about the American justice system. At the same time, I did not agree with Greenwald on all of his points. I sometimes found him to be a little bit TOO critical of the government. After September 11, in particular, I believe that the government was faced with unique and shocking circumstances. American officials believed that they had an urgent obligation to find new ways of protecting national security. Although the war on terror led to some acts that were not justifiable, to me these are different in a different category from the government's failure to prosecute Wall Street criminals. In the case of the latter the rich are more or less escaping justice for no good reason. On the whole, however, this book is an important one that raises fundamental questions about how justice is dispensed in America.
ANOTHER BOOK REVIEW
SOME USEFUL OBSERVATIONS IN THE SERVICE OF A FANTASTIC ARGUMENT
By John Winters, October 29, 2011
When I say fantastic, I mean of or relating to fantasy. And that fantasy is the idea that the "law" or the "state" ever equally represented people, that it was ever not a tool ultimately under the control of the economically powerful, that it ever functioned to provide liberty and justice for ALL.
As he does on his blog, Glenn fills his book with example after example of the legal double standards in the United States. It is in pointing out these double standards that he's at his most impassioned and readable. But just as his strengths carry over from his blog to the book, so do his weaknesses. The biggest one is that Glenn never really gets beyond the listing of grievances to offer a compelling explanation of why injustice has grown in recent decades (although, to Glenn's credit, he notes it has coincided with a massively growing economic gap). In other words, Glenn describes well, but explains poorly.
His attempt to provide an over arching framework is to cite the pardon of Nixon as a watershed moment, as if the pardon was a consciousness raising moment for political elites who were then emboldened to break the law with impunity. The problem with this historical narrative isn't that Nixon's pardon wasn't exceptional. It was indeed exceptional, but for a completely different reason. It symbolized a brief moment in U.S. history where grassroots pressure resulted in the exposure of crimes at the highest level of government. It was the exposure of the crimes, crimes which LBJ, JFK, and so many other previous presidents (of both parties) engaged in, that was remarkable. Not the fact that political leaders were getting away with the crimes, not the fact that political leaders began to expect to get away with their misdeeds.
Glenn fails to offer any decent explanatory foundation for the problem he identifies because he doesn't grasp enough of the history of power and how it has operated in the United States. An unfortunate consequence of this is the implication that we need to get back to some kind of legal garden of eden that Glenn seems to think we have fallen away from after Gerald Ford bit the forbidden fruit. It appears Greenwald hasn't read Howard Zinn, or has any familiarity with the fact that the powerful have always believed that their political and legal domination are the equivalent of justice for all, even when that "justice" has excluded women, Native Americans, African Americans, etc. Today is no different. There is injustice and inequality that benefit the people who think society and its application of laws are just and equal. The only notable change has been in how the elites reconcile their domination with the myth of equality.
The problem with Glenn's failure to construct an adequate explanatory frame is that it leaves him confused about where to go politically. Because Glenn keeps looking back to a paradisical time when capitalism supposedly rewarded the hard-working and punished the slothful, because he mistakes a presidential pardon with the underlying roots of inequality and injustice, he is left in a situation where he senses that roots of injustice run deep but where he is still implicitly wedded to the notion of "reclaiming" the democratic party. As if the party was ever not dominated by the powerful, who have only occasionally had to make concessions in periods of intense popular upheaval.
After hundreds of pages, the reader is left convinced that the law is indeed largely formulated by and at the behest of the powerful. But this observation is hardly new. Crack open any text by Marx or Bakunin, and you'll get a much more compelling expose, one that links up with an explanatory map capable of guiding activists who want to change the world for the better.