Policing Wall Street

Paulie Brading

We've finally got some cops on the Wall Street beat. The Security and Exchange Commission filed a law suit against Goldman Sachs last week stating the bank committed fraud. On Thursday of this week Democratic Senator Chris Dodd, chairman of the Senate Banking Committee is set to release the committee's overhaul of our nation's financial regulations. Republican Senator Mitch McConnell and his 41 Republican groupies have banded together to oppose Wall Street regulation. McConnell also visited with 25 Wall Street financial wizards last week in NYC. What promises were made during that meeting?

This is just the beginning of a summer of scandals where serious attention will be given to to the practices of the big banks. We will take a trip down memory lane back to 2007 when the housing bubble collapsed and Bear Sterns failed. Merrill Lynch and AIG scandals rocked the house. Barack Obama was elected fifteen months ago.

What we're really talking about is corporate influence on our 100 Senators. John Paulson, hedge fund manager for Goldman Sachs is the guy who may take the fall for fraud. Paulson gave $28,500 to the Republican National Committee and he gave $30,400 to the Democratic Senatorial Campaign Committee. He donated to McCain's presidential campaign and he donated to Barack Obama's presidential campaign. Just in case it would be helpful to Goldman Sachs he donated to R-Eric cantor, R- Mitt Romney and R-Rudy Giuliani. On the Democrat's side Paulson donated to D-Chris Dodd, chairman of the Senate Banking Committee and to D- Harry Reid. All the palms were carefully greased to position Goldman Sachs in the lead up to this Thursday's financial overhaul coming out of Dodd's committee.

NyTimes columnist Paul Krugman called Paulson and others in the same business, 'Gucci loafer wearing looters." If the shoe fits, wear it. Get ready for pundits gone wild. It's going to be a long hot summer.

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    Good news.

    What never gets investigated, though, and really addresses the rot, is the fact that these situations don't occur out of the blue. There were numerous whistle blowers, gadflies, knowing insiders, and pols too, that knew exactly what was happening. They were marginalized, systematically discredited, personally attacked, and generally got out of the way. Let's investigate who that happened.

    In the US system of justice, a prosecutor tries to see what they can pin on someone. The people taht were calling the shots obviously knew what the goal was, or they wouldn't have known who to marginalize, and were smart enough to not commit the felonies that could be pinned on someone themselves. We need to be using more of the approach of the French justice system, where there's an emphasis on finding out what happened. Here it's prosecute and defend, let the courts decide which is stronger. While that's a great way of ensuring individual rights, it often doesn't get at an exhaustive process description of what happened.

    That's what we have to have here, and it's what we won't get. The conclusions would be, "yes, it was criminal; yes, it was immoral; that's largely the way things operate in the US". The "opposition" going after the fall guys is as much a part of the crime as the looting was.

    The rest is just class warfare. Personally, I'm a bit partial to class warfare. Good Dems claim to disparage it, though.

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