August 24, 2011 5 Comments
Once again, President Obama is pulling a 180 on Candidate Obama’s promises. In this case, he promised that he would punish those responsible for intentionally tanking the economy in 2008. Now, it seems, the president is doing everything he can to make sure everything works out in Wall Street’s favor while the good folks on Main Street who got totally and completely fucked will be left to pick up scraps and continue to slave away for our corporate overlords.
On the one side is Eric Schneiderman, the New York Attorney General, who is conducting his own investigation into the era of securitizations – the practice of chopping up assets like mortgages and converting them into saleable securities – that led up to the financial crisis of 2007-2008.
On the other side is the Obama administration, all the banks, and, now, apparently, all the other state attorneys general. […]
This deal will also submarine efforts by both defrauded investors in MBS and unfairly foreclosed-upon homeowners and borrowers to obtain any kind of relief in the civil court system. The AGs initially talked about $20 billion as a settlement number, money that would “toward loan modifications and possibly counseling for homeowners,” as Gretchen Morgenson reported the other day.
The banks, however, apparently “balked” at paying that sum, and no doubt it will end up being a lesser amount when the deal is finally done.
To give you an indication of how absurdly small a number even $20 billion is relative to the sums of money the banks made unloading worthless crap subprime assets on foreigners, pension funds and other unsuspecting suckers around the world, consider this: in 2008 alone, the state pension fund of Florida, all by itself, lost more than three times that amount ($62 billion) thanks in significant part to investments in these deadly MBS.
So this deal being cooked up is the ultimate Papal indulgence. By the time that $20 billion (if it even ends up being that high) gets divvied up between all the major players, the broadest and most destructive fraud scheme in American history, one that makes the S&L crisis look like a cheap liquor store holdup , will be safely reduced to a single painful but eminently survivable one-time line item for all the major perpetrators.
I love the line “the ultimate papal indulgence.” That’s genius.
This is the essential problem facing Obama next year: the failure to even TRY to deliver on the promises he made as a candidate.
I’ve been wracking my brain; what part of his platform has he succeeded in passing?
Healthcare? nope. He buckled and we got Hillary’s plan instead of the public option we voted for.
Closing Gitmo? nope.
Out of Iraq? not quite.
Afghanistan? still there, though we did get Bin Laden and Obama should be commended for that.
Certainly we haven’t seen the ‘change’ we were promised and frankly, I am yet to see him even try. I expect the youth vote to stay home, once again convinced that their vote don’t mean shit, and when you remove those votes, shift the independents around and factor in a fired-up right wing, you get a mix that spells doom for the president in a race where turnout is going to be the key component…
Mark my words, this is turning into the theme song of the 2012 election: