Ten Years After the Lehman Collapse

How a decade flies by when you're Richie Rich, and your class has sucked up a full 94% of all the household wealth "lost" in the financial crisis which began with the death of Lehman Brothers on September 15, 2008.

To hear liberal pundit Paul Krugman revise history by ignoring the endemic corruption of the global financial system, and to foist the blame for the continuing social and economic meltdown almost entirely on Republican obstructionism is to continue sliding down an Orwellian memory hole.   

Why did the response to a depressed economy fall short? We can debate endlessly whether the Obama administration could have gotten a bigger, more sustained stimulus through Congress; what’s clear is that some officials failed to see the need for stronger policies. When Christina Romer, the administration’s top economist, argued for more stimulus, Tim Geithner, the Treasury secretary, dismissed it as “sugar.”

Beyond that, efforts to fight unemployment had to deal with a bizarre Beltway consensus that despite high unemployment and record low interest rates, debt, not jobs, was the real problem.

But the most important reason the great slump went on so long was scorched-earth Republican opposition to anything and everything that might have helped offset the fallout from the housing bust.

As you can see, Krugman almost, but not quite, chides the Obama administration by merely hinting at how enthusiastically the Democrats embraced an austerity regimen for the little people and boosted prosperity for the wealthy, not least by the extension of the Bush-era tax cuts. Instead, he harps upon the GOP "blackmail" of Barack Obama, as if Obama himself weren't a true believer in neoliberal ideology (the market replacing representative democracy.) Then again, it wouldn't do for the most influential liberal pundit in America to put a damper on Obama's own ongoing revisionist campaign tour, in which he absolves himself of any and all culpability for the ongoing disaster affecting most people in this country.

Krugman then pivots to the GOP hypocrisy evidenced by the most recent round of tax cuts for the rich and the new conventional wisdom that deficits don't matter when Republicans are in control. He forgets to mention that the Democratic leadership is already vowing to re-implement the austerian "pay-go" rules if and when they retake power in November. This means that social programs benefiting ordinary people will have to be paid for by slashing other social programs benefiting ordinary people. The trillion-dollar wars which are truly bankrupting this country both morally and financially will go on as usual.

My published response to Krugman, who completely ignored the crime and corruption which caused, and continues to cause, so much misery:

 It's true that the GOP impeded the recovery. But they couldn't have stopped the Obama administration from prosecuting financial criminals and ensuring that bailouts went to Main Street as well as Wall Street.

Instead, CNBC's Rick Santelli dog-whistled the blame at "irresponsible" mortgagors (read: the poor and minorities) rather than on bipartisan deregulation. That rant gave rise to the Tea Party, and eventually, to Trump.

It was during the Clinton administration that Commodity Futures Trading Commissioner Brooksley Born warned about toxic derivatives, and her SOS was duly shot down by Dep. Treasury Sec. Larry Summers, who accused her of fomenting financial crisis. How wrong he turned out to be, but expert that he is, he went on to become one of Obama's chief advisers.

For as Wikileaks has shown, Obama's cabinet was vetted by Citigroup. Geithner has since gone on to make big bucks in private equity, and Atty. Gen. Eric Holder's seat at white collar defense powerhouse Covington & Burling was kept nice and warm for him.

 Although the White House boasted in 2012 that it had criminally prosecuted 530 financiers since the collapse, a subsequent investigation by the DOJ's Inspector General revealed the real number to be only 107, with real restitution to the public less than $100 million, and not the boastful billion.

This is all a matter of public record. Maybe the Democrats will start winning elections once they start switching their allegiances to Regular Joe and Jane.

(as an aside, I really have to compliment the recent work of Times comment-moderators in removing all the nasty replies accusing me of being a Trump supporter, and worse, for my pointing out inconvenient and well-documented facts!)

The 2014 I.G. audit I referenced in my comment has to do with the Obama Justice Department's abject failure to investigate and prosecute mortgage fraud cases, and then blatantly lying to the public about it. It found that the absolute lowest priority of the FBI was in cracking down on fraud scams against homeowners and mortgagors. Despite Obama's ostentatious signing in 2009 of the Fraud Enforcement and Recovery Act (FERA) there was precious little enforcement or recovery. 

According to the I.G. report, this was despite what Krugman called a cynical obstructionist Congress appropriating "significant" funding ($196 million) to the Justice Department, through 2011, for the prosecution of mortgage fraud and other white collar crimes via the hiring of additional FBI agents and adding to the existing mortgage fraud tax force.

In a 2012 press conference, Eric Holder, along with officials from Housing and Urban Development and Treasury, outright lied about the number of cases brought under the so-called Distressed Homeowners Initiative. Remember, the fudging of the facts was the conclusion of Holder's own internal watchdog and not some lousy cabal of Republican obstructionists!

Meanwhile, as an elite soldier in the anti-Trump Resistance, Holder recently schmoozed to Ministry of Truth outlet CNN that he thinks he "has what it takes to be president" because  "(We need) somebody who has the vision for the job, somebody who has got the necessary experience, somebody who has the capacity, physical as well as mental. Somebody who also has the ability to inspire people, to make people believe government can be the force for good and make people believe in this thing we call America. (They) have to be able to move people, to bring up together in ways this President has clearly not done."

Translation: he has what it takes, because his white collar criminal friends have taken what everybody else once had. Holder has the proven ability to inspire more crooks to believe that government will be a force for their own good, ensuring that the very wealthy will continue to rely on socialism for themselves and penury and prosecution for everybody else. Trump has been woefully unable to pull the wool over ordinary people's eyes. The guy is pure, fake polyester. Plus, he is an incapable fat slob, while Eric is genuine silky-smooth, toned, and smart. He has a proven track record of moving people... right out of their homes.  

Actually, I'd love to see Eric on a stage with former NYC Shrillionaire Mayor Mike Bloomberg, who is also planning a presidential run on the Democratic ticket. After they finish gushing all over each other, they can argue about who's the tougher guy: Holder, who protected the banksters and evicted the poor, or Bloomberg, who is so nasty that even the nasty and corrupt New York governor, Andrew Cuomo, thought he was going too far when he mandated that food stamp applicants be fingerprinted.