The article below expresses pretty well my current feelings about what the government is doing about the financial mess. The reform bill seems like a joke to me. The Goldman Sachs hearings were a circus for the masses.
Because the article is 8 days old, it references the 50 billion dollar "slush fund" to bail out banks---which has been eliminated during negotiations with Republicans. I have not quoted those paragraphs here. As far as I know, its characterization of the bill is otherwise essentially correct, but I'll admit I do not have the expertise to follow these things in detail, I'd appreciate any necessary corrections, especially from the "dKos financial expert team."
Only a few weeks ago (as I observed in my diary), Obama stood on a stage next to Paul Volcker and said he would partially revive Glass Steagall. What happened?
Alex Jones' InfoWars.com 4-22-2010
Ironically, the antipathy toward big banks and corporate socialism is leading the nation straight for more of just that. Under the guise of regulatory reform, President Barack Obama, with the help of congress, is attempting to ram through a bill that provides very little real oversight or protection from financial calamity. Rather, it almost ensures it.
However, a second and much more pressing problem exists within the bill. Namely, that it is mainly a cover for unlimited and permanent bailout authority granted to the Treasury Department. Under this legislation the Treasury would be able to make loan guarantees for any institution that is deemed to be "systemically significant," a term that can be open to many interpretations and no doubt will be as things progress. (Ward) This is similar to the blank check written in the TARP legislation during the bailouts of 2008-present, now totaling close to $25 trillion dollars of total cost.(Watson) In an interview with Politico, Democratic Congressman Brad Sherman of California stated plainly, "The Dodd bill has unlimited executive bailout authority. That’s something Wall Street desperately wants but doesn’t dare ask for. The bill contains permanent, unlimited bailout authority."(Mark)
The lawsuit against Goldman Sachs by the SEC is only one more part of this show. Only a few weeks ago, the Securities Exchange Commission charged Goldman Sachs with fraud, alleging "Goldman wrongly permitted a client that was betting against the mortgage market to heavily influence which mortgage securities to include in an investment portfolio, while telling other investors that the securities were selected by an independent, objective third party."(Hunter) Essentially, the charges suggest that Goldman Sachs, along with a hedge fund client, assembled a collection of sub-prime investments that were put together intentionally to fail and then bet against it. They then took out an insurance policy on those same securities with AIG. (Hunter). Yet while many Americans laud the actions of the SEC and celebrate what they believe to be the hand of justice descending down upon the big banks, they lose sight of the fact that this is only one individual case of fraud. Realistically, this is business as usual on Wall Street and it represents virtually the entire derivatives market. However, the SEC has only managed to produce charges for one isolated incident. (Hunter) This situation is reminiscient of the outrage expressed at a few billion dollars worth of executive bonuses while the trillions of dollars funneled to international banks was completely ignored. These charges, while well-deserved, are potentially a setup for the American people. Indeed, they provide the populace with the opportunity to cheer as Goldman Sachs gets handed a fine that they will almost certainly be able to pay without batting an eye while the real cost of the bailouts and corrupt derivatives market is entirely ignored.
Yet even the prospect of a hefty fine, when looked at closely, seems to dwindle. Tony Fratto, former White House and Treasury Department expert on financial policy has suggested that the case produced by the SEC is weak. He is quoted by the Daily Caller as saying, "I think it’s becoming clear to most people who understand the business and the law that SEC is very unlikely to prevail in court." (Ward) So did the SEC intentionally produce a fragile case against Goldman Sachs so as not to ensure any in-depth meaningful investigation? At this point, we can’t be entirely sure. However, we can be sure that the prospect of anything more than a show trial is getting smaller by the day.