Wednesday, May 6, 2009

Break the Bank(s)

I am not a lawyer. I know many lawyers, but I don't believe that you can become a lawyer by osmosis. Having said that, I am going to go ahead and give my opinion on what I call--The Bullshit Banking System of the United States of America.

I heard on CNN today Sheila Bair, FDIC chairperson, in testimony before Congress say, "A bank that is too large to fail, is a bank that is too large to exist." When the head of the agency that is responsible for making sure that your money does not up and vanish if a bank should fall apart is saying clearly that our banking system has become too bloated and too dependent on monstrous amoebas that seen to grow without end, I think perhaps someone should pay attention.

On July 2, 1890 the United States Congress passed the Sherman Anti-Trust Act. The Sherman Act was the first federal law regulating and outlawing most cartels and monopolies (though I was surprised to find out that monopolies are legal as long as the single corporation that has a monopoly came about the monopoly through above board business practices and superior products, etc). The rationale behind the law was two fold: to protect the consumer from unfair pricing AND to keep the various industry and financial systems from collapsing.


Again, I am no lawyer. But, perhaps, if a company has grown so large (ahem Lehmann Brothers..ahem ahem AIG) that when they teeter on the brink of collapse (or collapse) the entire financial system is derailed and we are plunged into an instant recession..well...that may just be a trust issue. While neither Lehmann or AIG could be described as a "monopoly" in terms of owning a lion share of any particular industry...they did own enough of the economy that their failure has created no end of chaos, instability, and damage.

The most interesting part of the act, at least to me, is that the act puts the responsibility for keeping this sort of mayhem from happening on the shoulders of government attorneys and district courts. So, while the corporations themselves deserve a giant ass beating, in the end, the fault for not addressing the existence of these behemoths, their bloated and inflated bottom lines, and their avarice lies squarely with the federal government. Now, while Bush sure as hell accelerated the fat cat fattiness...the deregulation and enhancement of the corporate state truly started with Reagan's crazy ass. This, ladies and gentlemen is what Reaganomics gets you: an unemployment rate hovering near 10% and the worst economic crisis since the Great Depression.

Tell me again how that man is some sort of American hero and deserves anything but ridicule and having his name blackened out of our history, our popular consciousness, and off National Airport. I would like to strike and revise part of my previous comment your honor...he should not have his name erased from should be remembered and vilified.

I will end my cross examination of Reagan with those comments.

The Obama administration inherited a holy mess that took 30 years to create and is going to take decades to undo. But, clearly, we need to use the tools at our disposal. The U.S. government needs to use the various anti-trust acts to break apart any financial institution that, if it should collapse, would worsen our existing crisis or create a new one. There needs to be drastic action a la the breaking apart of the Bells. And there needs to be strict legislation enacted that regulates the size of financial institutions, how they can or can not expand, and where and how they can absorb non-related business and/or take on risky assets while trying to make a quick buck.

Right about now the U.S. government aka the people...own a big old chunk of a number of the largest financial institutions in the nation. We need to use our right as a major shareholder to force the issue. It is time for Obama to make himself chairman of the board of whoever the hell resists downsizing for the good of all of us...and rip apart the companies until they are at a size and scope that is manageable and is unable to threaten the livelihoods of millions of peoples in order to meet its quest for the ever broadening bottom line that benefits 1% of the U.S. population.

Where current law comes up short around the federal governments ability to break apart these bankasauruses, Congress needs to put its 1,070 feet (435 congress members and 100 senators) up their own butts and pass the laws necessary to give Obama the tools he needs to make sure that corporate greed never again outpaces common sense or the ability of the government to arrest cancerous corporate growth before the economy metastasizes.

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