The times are few and far between that I am in agreement with Senator Elizabeth Warren’s brand of Big Government liberalism. But I do applaud her willingness to stand up to the Wall Street lobby machine; her capacity to recognize and call-out out the egregious gambling dens that have metastasized there; and her insistence that never again should the hard-pressed taxpayers of America be forced to bailout the crony capitalist plunder that is enabled by the Fed’s free money madness.
But now comes a naked Wall Street raid on the taxpayers that’s beyond the pale; and it would have sailed right through in the dead of night absent Elizabeth Warren’s intrepid opposition. Bravo, Senator!
I am referring to the Citigroup drafted sneak attack on Washington’s tepid effort to curtail the more egregious gambling habits of some of the big banks. These incorrigible larcenists have been trying to gut the “push out†provisions of Dodd-Frank for more than three years now, yet the latter boils down to a simple and urgently necessary injunction to the banks. Namely, you can’t roll the dice in the “derivatives†gambling arenas with taxpayer guaranteed deposits.
In light of the inherent dangers of what even Warren Buffet once called “financial weapons of mass destructionâ€, it is self-evident that no bank—not even the mighty Citigroup—–should be allowed to bring these incendiary devices within a country-mile of the taxpayer enabled FDIC guarantee program. So what Dodd-Frank does is to say go ahead and swing for the fences, but do it in a holding company subsidiary. If something subsequently goes boom in the night, its one your earnings and bonus, not the taxpayers hard earned bucks.
If there was anyone left on Wall Street with a sense of decency and a modest comprehension of what free market capitalism they would not be looing a gift horse in the mouth. The Dodd-Frank provision now under its furious attack has hardly a slap on the wrist. If Congress had really meant to fix the system that supposedly brought us to the cusp of Armageddon in September 2008 it would not have bothered with Dodd-Frank at all—-and its incomprehensible 2500 pages of legislative pettifoggery and 10,000 pages of implementing regulations.
Instead, it should have gone to the root of the problem and passed a Super Glass-Steagall that would have dismembered the giant banks by statutory edict, and kicked the Wall Street based gambling houses like Citigroup out of the FDIC entirely. The fact is, deposit insurance has been coopted and abused by the Wall Street mega-banks for decades, and now stands as a vast perversion of what had actually been intended—-misguided or not—way back in the dark hours of 1934.
