I was watching "Too Big To Fail" and an exchange caught my attention.
Cynthia Nixon, playing the press liaison for Secretary of the Treasury Hank Paulson has just had the situation of AIG explained to her. She asks:
What do I tell them when they ask why this wasn't regulated?
William Hurt, as Hank Paulson answers:
No one wanted to. We were making too much money.
Hank Paulson, as head of Goldman Sachs, lobbied heavily to keep the Collateral Debt Obligations, Mortgage Backed Securities, and Debt Swaps from being regulated.
People made billions.
Ordinary people got screwed. I am using polite language.
Yes, the world's entire financial system was at risk.
So there was intervention.
But the greedy bastards who helped create the mess that exposed everyone to the potential dangers of the failure of the world financial system neither went to jail nor were forced to disgorge their profits to cover the cost of bailing them out.
They were too big to fail.
And the rest of us, who have lost income, wealth, value in our homes, pensions, and financial future? We were too small to matter.
This administration has still NOT addressed that, in part because it has as Secretary of Treasury a man who helped to create the mess.
Our government is still too concerned with Too BIg To Fail.
Rather than breaking up the monoliths that fall into such a category, so that they can take risks without responsibility, creating a moral hazard for which the rest of us pay, financial power is even more concentrated.
And the rest of us? We remain too small to matter.
Is there any solution, or should we just admit that we are all fucked?