Why are no Wall Street execs in prison?
One reason is that we citizens haven’t raised enough ruckus
My favorite moment in the Academy Awards show Sunday night came when Charles Ferguson accepted the Best Documentary honor for Inside Job.
The film is a fierce indictment of the Wall Street money managers whose colossal criminality put 8 million Americans out of work, nearly brought down the world’s financial system, and caused the worst recession since the Great Depression.
Ferguson didn’t mince words. “Forgive me, I must start by pointing out that three years after our horrific financial crisis caused by financial fraud, not a single financial executive has gone to jail, and that’s wrong,” he said.
Amen to that.
There’s a great piece by Matt Taibbi in the latest Rolling Stone called “Why Isn’t Wall Street in Jail?” Execs at companies like AIG, Goldman Sachs, JP Morgan Chase, Bank of America and Morgan Stanley were “directly involved in elaborate fraud and theft,” he writes. “Yet not one of them has faced time behind bars.”
Instead, they have been allowed to buy their way free by paying “pathetically small fines”—often using shareholder funds—without being required to admit wrongdoing. Fines don’t mean much to the richest people on Earth, but jail time does. Taibbi quotes a former congressional aide: “You put [Goldman Sachs CEO] Lloyd Blankfein in pound-me-in-the-ass prison for one six-month term, and all this bullshit would stop, all over Wall Street. That’s all it would take. Just once.”
Why haven’t any of these fraudsters been sent to the slammer? In part it’s because there’s a revolving door between oversight agencies like the Securities and Exchange Commission and the big Wall Street firms.
But it’s also because, as Danny Schechter, author of The Crime of Our Time, points out in “Ten Reasons Why Wall Street Skated” (consortiumnews.com), establishment institutions now fully side with the rich, and the rich have rigged the system. Who do you think is behind the effort to destroy the public-employee unions?
The rest of us share the blame. We haven’t raised enough ruckus or rattled enough cages to force the government to go after the sharks who actually shed the blood. We haven’t been sufficiently indignant, even though, as William Blake said, the voice of righteous indignation is the voice of God.
I mention all this because it relates to our cover story, “Under water and sinking”, by Jaime O’Neill, about the damage the recession-caused housing crisis has wrought locally.
As he points out, too many of us got suckered in by cheap loans and the promise of ever-rising home values. That was foolish, maybe, but it wasn’t criminal or even immoral—and besides, who foresaw the meltdown? Still, for too many people it’s meant the end of the dream—the American Dream.
With this issue, we welcome Jerry Olenyn to our pages. The former Action News anchor and reporter has given us a nifty piece about former Chico City Councilman Steve Bertagna’s new career path as a cop. Olenyn is a skilled reporter, and now he’s shown he doesn’t need visuals to tell a vivid story. Good to have you aboard, Jerry.