The continuing story behind the most audacious power & money grab in history, and how we might put an end to it.
The financial crisis that exploded in 2008 isn't over; likely the worst is yet to come. As Matt Taibbi says in his new expose', Griftopia, the stunning rise, fall, and rescue of Wall Street in the bubble-and-bailout era was the coming-out party for the network of looters who now stand at the pinnacle of American political and economic power. These looters--the largest players in the financial industry and the politicians who do their bidding--have been growing ever more powerful for a generation, transferring wealth upward through increasingly complex financial mechanisms and political maneuvers. The crisis we've been through so far was only one terrifying manifestation of how they've hijacked America's political and economic system. And with regard to what they're going to extract from us, they're just getting started.
Skeptical? Matt's book unravels the whole fiendish story, exploring the deeper roots and wider implications of the rise of the new kleptocracy that is gradually replacing our democracy. It tells us about the backroom deals that decided the winners and losers in the government bailouts and that helped inflate the hidden commodities bubble that transferred additional billions of dollars to Wall Street -- at the cost of creating food shortages, and even some starvation, around the world.
From the story of investment bankers auctioning off America's infrastructure to an inside account of the high-stakes battle for health-care reform, here in simple language are presented the new inner workings of politics and finance in this country as well as explanation and examples of how the former is ever more thoroughly dominated by the latter.
The outlines of these financial-political arrangements are clear, and it was within the web of financial, regulatory and political malfeasance that the financial meltdown began. At the center, hucksters systematically sold trillions of dollars of fraudulent securities to unsuspecting people across the globe. And it was all done under the noses of regulators, each apparently vying for the title of "Inspector Clouseau."
Thanks to the system's policy of full non-disclosure, a $2 trillion US scam turned into a $30 trillion global meltdown. No one knew which securities were toxic. Consequently no one trusted financial companies or any of their products. This non-disclosure continues and could easily take down even a bank as big as J P Morgan.
Millions lost their jobs, savings and confidence. And without enough of the mutual trust that those three things bring, our Great Recession could still, with one more major financial tremor, become our Greatest Depression.
Uncle Sam's financial guarantees now total $24 trillion. The Federal Deposit Insurance Corporation alone backs $6 trillion in current accounts with essentially zero reserves. If there was a run on American banks, Uncle Sam would have to print those $6 trillion, causing hyperinflation, which would trigger the other $18 trillion in guarantees, meaning trillions more would have to be printed, causing even more inflation. Anyone not running for their money to buy something real would end up with worthless cash. Uncle Sam's dirty little secret is that he's guaranteeing pieces of paper, not purchasing power.