To answer that initial question by Bill Maher, Matt Taibbi responded with a rhetorical question:
"How much drug enforcement would there be in this country if every top-ranking narc had a $2 million-a-year job waiting for them with the local drug dealer after they left government service?" (After their careers on "the Hill," lot of former members of Congress go to work as lobbyists for the financial industry, receiving about that same amount of money.)
Bill Maher: So tell us in simple terms why the banksters belong in jail?
Matt's reply, nearly verbatim:
All the banks were broadly involved in a criminal fraud scheme that involved the selling of mis-marked mortgage-backed securities. These securities were composed of toxic, crappy sub-prime mortgages that they were waving a bunch of phony-baloney ratings over (like using some kind of "magic wand') and then selling them off to pension funds, insurance companies, and banks around the world. They were "wanded' (fraudulently labeled) as AAA-rated securities, which were by no means really anything close to AAA quality-- far from it. It was like selling oregano, claiming it was high-quality marijuana, and doing it on a massive, massive scale, to thousands of defrauded buyers.
When it comes to financial fraud, the banksters in the financial services industry far outdid Bernie Madoff, who was just doing a simple, age-old Ponzi scheme. In contrast to that, the Wall Street banksters were doing something on a vastly larger scale, cheating vastly larger numbers of people than Bernie ever cheated. Theirs was a much, much bigger operation. As a result, millions of Americans went into foreclosure and a great many lost their homes, just as millions more probably will. Millions more lost their jobs, in part because of the falling real estate values and the greatly reduced spending of those whose home values went way south, with many of them eventually losing their homes or fearing they might. Meanwhile, the banksters who sold these folks the predatory loans are still living like Pablo Escobar, another very successful criminal. But unlike Escobar, virtually none of the banksters have gone to jail, nor will they. Plus, the likelihood is strong that that all of them will continue to keep the trillions they stole from us. Angelo Mozillo from Countrywide Financial was the only bankster to come close to getting time behind bars and he got off with a $45 million fine and a promise to never again serve as the director of a large institution. So yes crime pays in the United States, at least for banksters and those in government who pave their way.
Who are some of the other Mubarak-level bankster/looters in this country?
Dick Fuld from Lehman Brothers got away with $500 million of essentially stolen money. He cashed out before his company went down. He undoubtedly knew what was going to happen and pulled his cash out of his company while telling his investors that everything was fine.
Alan Greenspan played a huge role in the bubbles that developed: first the tech bubble in the 90s and then the mortgage bubble that we just went through. And as Taibbi reminds us, every time Wall Street screws up (by making reckless investment gambles), the banksters get to go back to the Fed and borrow as much money as they need, to start the game all over again! They go to the Fed and borrow money at essentially zero percent interest and then lend it back to the American people at (credit card) rates that often approach 20 or 30%, and gamble much of the rest in the stock- and derivatives markets.
Essentially what we're looking at here is a giant "subsidy" system -- for banksters -- that is based on the generosity, and/or gullibility, of American taxpayers and voters, most of whom are essentially still asleep at the wheel.
The pension funds that state workers have, were set up for many of the same people who today turn out to be the victims of the mortgage-backed securities scheme. It was to these pension funds that the banksters sold many of these toxic sub-prime mortgages (in the form of mortgage-backed securities) that eventually blew up, causing the pension funds to lose all or most of their money. And now the states (which ended up broke as a result of all the tax revenue shortages, caused by the consequent recession) have to pay these pensions to teachers and other state workers (firefighters and policemen) that have retired, even though they were all defrauded by these banks on Wall Street and the banksters who ran them. Meanwhile, state and county workers continue to get laid off right and left, as tax revenues continue to shrink right along with plunging home values and hundreds of thousands of foreclosures, layoffs and pay cuts.
But in spite of all this ghastly fallout from their crimes, the fat cats continue to do just fine
From 1979 to 2006, the richest 1% more than doubled their share of the total US income, from 10% to 23%. The richest 1% have an average annual income of more than $1.3 million. This is not surprising when you consider that for the last 25 years, over 90% of the total growth in income in the US went to the top 10% of earners -- leaving 9% of all new income to be shared by the bottom 90%. Source: Jared Bernstein and Heidi Shierholz, State of Working America.
Meanwhile, Glen Beck goes on and on about lefty "socialists" descending on Washington, and Rush Limbaugh rails about "class warfare for a leftist agenda that will destroy our society." Beck is being paid something in excess of $30 million a year to be a propagandist (liar) for the rich. In Limbaugh's case it is now something like $200 million a year for his services as a liar/propagandist, because he does such a good job of bamboozeling the rubes. Interesting to note that when he first went on the air, he operated at a loss in terms of the advertising revenue that he generated. But the powers-that-be kept paying him well because they believed he had great potential and they thought he would be a good investment. And indeed he was -- for them.
Societal consequences, in part because of this ongoing grand subsidy for banksters
Women in the US now have a greater lifetime risk of dying from pregnancy-related conditions than women in 40 other countries. And African American women are nearly 4 times more likely to die of pregnancy-related complications than white women. Source: Amnesty International Maternal Health Care Crisis in the USA.
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