America has lost its moral compass and has been taken over by a greed-infested corporate culture.
Well, actually, it was Goldman Sachs that lost its compass and was taken over by greed, according to a N.Y. Times op-ed column written last week by a departing Goldman executive in London. But the allegation might just as well have been made against our entire Corporatocracy and the political system it controls.
As first expressed over 60 years ago by Harry Elmer Barnes and Negley King Teeters in their classic book, New Horizons in Criminology: “Most offenses are committed through greed, not need.”
And it was an explosion of greed that was the precursor to the tsunami of economic problems that have beset the middle class, followed closely by a host of financial crimes. Then came the lies, an orchestrated chorus of untruths intended to perpetuate the destructive trends that have benefited the wealthy.
During the years of greed preceding the Great Recession, trillions of dollars were gambled in the derivatives market on such outcomes as the direction of interest rates and currency gyrations, with a loser for every winner, while the actual losers, it turned out, were the American taxpayers, hitting particularly hard at the middle class.
And trillions more disappeared into the subprime mortgage fiasco and into an evil creation by JPMorgan called the credit default swap, a toxic-as-hell abomination devoid of any reserve requirement that was appropriately described by Warren Buffett as a “financial weapon of mass destruction.”
During this time, the U.S. government was cooperating fully, eliminating key regulations and cutting the legs out from under many others.
Then came the crime wave, which might be thought of as Phase Two in the attack on the middle class. It actually became apparent rather gradually. At first we were only aware of such minor offenses as the post-dating of stock options. Then came the insider trading scandals and finally a flood of other, more serious, crimes.
In the house of mirrors we now seem to live in, most of the prosecutions for these crimes have been launched by the SEC, and therein lies the rub. The SEC has no authority to convict anyone. The situation has been so ludicrous that, in many cases, the legal expenses of the defendants have had to be paid by the same stockholders who had been ripped off in the first place.
In discussing the matter of crimes, two companies in particular come to mind, and both have been in the news this past week. One is Goldman Sachs, the subject of the above-mentioned revelations by its departing executive which, incidentally, is hardly new information, but which represent a unique broadside from the inside.
Years ago, Greece hired Goldman to assess its problems and, when the company discovered the plight the country was in, it made a fortune betting against its own efforts to assist the nation. This then became a pattern it repeated with client after client.
In a recent example of the company’s lack of ethics, Goldman was El Paso’s paid advisor in its $21 billion buyout by Kinder Morgan last month. In the course of its involvement, it failed to advise El Paso that one of Goldman’s lead advisors on the team owned $340,000 of Kinder Morgan stock or that Goldman’s private-equity arm owned a stake in Kinder Morgan or that Goldman actually controlled two seats on Kinder Morgan’s board.
It appears that conflicts of interest and insider trading are not only accepted parts of the Goldman business plan, but may actually make up the key centerpiece of its strategy.
The other example in the criminal phase of the attack on the middle class is Bank of America, which was stripped naked and hung out to dry by Matt Taibbi in the current issue of Rolling Stone. Apparently, it would take a two-volume opus to detail all the nefarious dealings of this behemoth.
Briefly, they involved, among other crimes: plotting to rig global interest rates; bilking needy schools and cities; extracting multiple fees from unemployment checks; executing thousands of foreclosures using bogus, “robo-signed” evidence; knowingly selling worthless mortgages; and fraudulently inducing insurance companies to insure those same worthless mortgages; socking it once again to the middle class taxpayers.
The crime spree never gave the government a moment’s pause, however, in its obsession to prop up the institution, beginning four years ago with a $45 billion infusion of taxpayer funds. And, despite the bank’s payback, it hasn’t stopped there. Last year the Fed allowed the bank to receive FDIC insurance on a portfolio of particularly toxic assets, thus subjecting the public to significant additional liabilities. Finally, the latest move by the government to allegedly help stressed-out homeowners actually rewards the bank with a legal waiver that will enable it to avoid billions in lawsuits.
Regarding the recent stress test that the bank allegedly passed, Matt Taibbi charges that it is a sham made possible by “grossly overrating the mountains of toxic loans on its books.” In addition, according to Taibbi, the bank still faces “battles in courtrooms all over America to avoid paying back the hundreds of billions it stole from everyone in sight.”
And then came the most recent phase of the attack on the middle class, the orgy of lies. One might accurately say that we have become a nation increasingly built on a veritable mountain of distortions and untruths. If you are interested in such issues as climate change, the environment, the need for regulations, jobs, fracking, healthcare, and the list goes on, you had best put on your skeptical hat and be prepared to question most of the information you encounter.
As before, of the many candidates, two examples seem particularly worthy of mentioning, the first being the healthcare issue. Prior to the reform act, 60% of the public favored a single-payer government program. Yet, today, an even greater plurality opposes the Affordable Care Act approved by Congress, despite the fact that it is far less liberal than the single payer plan it had previously favored. What could have happened?
What happened was that the lie machine was shifted into high gear to protect the status quo and to continue to allow the insurance industry to run roughshod over the interests of middle America. The lies were skillfully and professionally articulated in a video that was featured on the front page of YouTube for an extensive period of time and was, from there, circulated throughout the country. It showed up twice in my e-mails. YouTube is owned by Google which is 30% controlled by two billionaires, Larry Page and Sergey Brin. In November, 2009, Forbes magazine rated Brin and Page as the fifth most powerful people in the world.
In short, the video provides an in-your-face collection of outrageously false information designed to scare the pants off just about anyone who sees it. Worst yet, the lies have been repeated ad nauseam by right wing politicians and the mainstream media. For those interested, a more detailed article on the subject of this video can be found by clicking here. If you believe you may have been influenced by false information on this matter, you might want to check out the article.
The second example of lies involves the vital jobs crisis. This is the heart of the problem besetting the middle class. There is hardly a dissenting voice in the chorus that sings the praises of our steady employment recovery. New jobs have been created every month for many, many moons we are told, and the unemployment rate has fallen from near 10% to 8.3%. However, this “good news” is, in reality, a case of cutting the middle class adrift in a voyage to nowhere because it ignores and distorts the actual picture.
Briefly, the truth is better revealed by the naked numbers that have not been tweaked by untold adjustments. Here is the basic data direct from the bureau of Labor Statistics that is believed to be devoid of any “fuzzy-math” adjustments.
Number of workers employed full time, 16 years of age and older:
December 2007 (Start of the Great Recession)………………...121,042,000
Jobs lost from December 2007 through February 2012.……… 8,455,000
Jobs lost during the last two months…………………………................463,000
Quite a different story from what we hear during this election year, don’t you agree? And, there’s more to it. According to the Labor Department, the population of the workforce between 2002 and 2012 has been growing at the rate of 145,000 per month. So, by combining the figures for the job loss with the workforce growth, the result is that while 8,455,000 jobs have been eliminated since December 2007 the workforce has also grown by 7,250,000, resulting in an overall current “misery number” of 15,750,000 which, incidentally, compares with a misery number of 15,821,000 as of one year ago. At this rate it will take, roughly, forever to restore the workforce to its pre-recession level.
The attack on the middle class, it seems, has no letup. Four days ago, in a case of perfectly bad timing, Republican Congressman Paul Ryan, the House Budget Committee Chairman, once again revived his plan for a major revision of Medicare combined with a renewal of the tax breaks for the wealthy. His proposals reportedly have the backing of candidate Mitt Romney.
And last, but definitely not least, the following chart clearly demonstrates the damage that has already been sustained by middle America. Prepared by the Bureau of Labor Statistics, it shows that the American workers’ share of the national income over the past 65 years has sunk to a recent series of record lows. The inverse would of course be true with respect to the share of the income attributable to the wealthy.
The seemingly inescapable conclusion from this is that a massive attack on the middle class has been underway for some time resulting in a major shift in wealth to the upper class. Furthermore, with the cooperation of politicians from both parties who, let’s not forget, are being well paid by the wealthy, as well as the billionaire-owned, mainstream media, the effort has obviously been largely conducted under the radar, while any attempt to mitigate it has been met with counter complaints of class warfare against the wealthy.
The nation has, indeed, lost its moral compass, and unless it is restored, our beloved country will likely continue its downward course towards a possible economic Armageddon.