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Could Wall Street Ever Face a "Murdoch Moment"?

Wednesday, 20 July 2011 04:19 By Richard RJ Eskow, The Campaign for America's Future | Op-Ed

History books record an empire's fall as a series of dates and events. Battles are fought, people resist, elections are called, arrest warrants are issued. But those are just details. An empire really falls in that moment when people stop believing that it's invulnerable. Whenever the spell is broken, whether it's by anger or just by awareness, the end becomes inevitable. It doesn't matter what happens to Rupert or James Murdoch now. They may return to positions of relative wealth and privilege or their lives may take unpleasant turns. Either way, the Murdoch empire has already fallen.

There's a lesson here for anyone who thinks the safest and surest path to success is by serving the seemingly invincible. Sure, it may lead to riches and power, at least for a while. But you may also wind up like those powerful people in Great Britain who now find themselves struggling with scandal, hiding in fear, or facing terrible legal consequences - all because they believed in Murdoch's invincibility and served him accordingly. As Martin Luther King often said (and we've often quoted), "The moral arc of the Universe is long, but it bends toward justice."

And since the Universe is our home, the Murdoch scandal reminds us of another principle too: "Never bet against the house."

Betting against the house. That's what those Scotland Yard officials did (if they're guilty) by taking NewsCorp bribes. It's what the current Prime Minister did by softpedaling bribery rumors and hiring a Murdoch editor as his press secretary. ("Hacking crisis edges closer to Cameron," says one headline.) The previous Prime Minister bet against the house, too - and now says he was effectively blackmailed by NewsCorp in a particularly abhorrent way over a sick child. And yet he said nothing.

Politicians and journalists were afraid to cross the invincible Murdoch, and we're told that Wall Street's power is unassailable, too. It seems impossible to imagine our uncrowned heads of finance facing a Murdoch-like fall, especially after the free ride they've enjoyed for the last few years. Despite a well-documented record of fraud, corruption, and abuse, they're all free as birds (birds of prey, that is). Not content with freedom or unearned wealth, they're even outraged that they don't have more of everything - more power, more money, more prestige. Let the Murdoch story remind them: Don't overplay your hand. And don't be too sure that your day of reckoning isn't coming.

Moral compromise can be seen everywhere in Washington, even among people who undoubtedly think of themselves as ethical and upright. From Sheila Bair, outgoing head of the FDIC: "If I heard that once, I heard it a thousand times. 'Citi is systemic, you have to do this.' No analysis, no meaningful discussion. It was very frustrating." (Peter Orszag left his job as the President's budget director to work for Citigroup.) JPMorgan Chase has a long history of corporate misdeeds and malfeasance leading to large financial settlements (the latest was last week), all without criminal prosecution. Yet its CEO continues to complain about Washington's insufficient fealty. (One of his senior executives recently became the President's Chief of Staff.)

We now know that allowing banks to investigate their own misdeeds and avoid prosecution has been Justice Department policy under both President Bush and President Obama. Murdoch's organization was allowed to investigate itself, too, and suddenly a lot of people are paying a price for that decision.

Click here to sign up for Truthout’s daily email updates.

But if Democrats have blurred the line, at least they've also pushed for some modest regulation of the financial industry. Republicans, on the other hand, have established new land speed records for the fastest delivery of cheap-shot takedowns, phony arguments, and obstructionism in the service of cash-bearing Wall Street bigshots. With a few notable exceptions, their only posture toward Wall Street has been that of an obsequious valet who serves an imperious master. You can't protect the nation from a banker's abuses if you're also shining his shoes and adjusting his cummerbund.

"Will that be all, Sir?"

The GOP's latest attempt at bank-directed character assassination has backfired. Because Mr. Issa's inquisitors demanded the internal records of the bipartisan Financial Crisis Inquiry Commission, we now know that Commissioner Peter Wallison (and perhaps others) did very questionable things - things designed to help Republicans in Congress overthrow Dodd/Frank regulatory reform, and which to all appearances violate the oath of office for a Commissioner.

You can call this sudden reversal in the GOP's fortunes whatever you want: payback, karma, or just a good run of luck. But whatever you call these reversals, they can shift the balance of power when you least expect it.

Our economy's statistics paint the picture of unchecked bank power, of a nation in thrall to an occupying financial force that's draining it of its lifeblood. Consider the evidence: Ten banks now own 77 percent of all bank assets in this country, up from 55 percent in 2002. Most people fear for our economic future and think we're still in a recession (because they are in one, even if Wall Street isn't).

After a national scandal and lawsuits from all fifty states, the banks' robosigning fraud continues. And after getting a pass for documented corruption and conflict of interest, unreliable US ratings "agencies" (really private companies who have been given too much power by the government) just gave the President of the United States the back of their hand. They'll rate junk bonds AAA to please a customer, but they they don't feel they need to please a government that's already served them so well. (Bet some folks wish they'd thrown the book at them when their misdeeds first came to light.)

It's their world, to paraphrase Sam and Dave, we're just living in it. Corporate-owned Republicans are passing legislation written in the bowels of the billionaire Koch Brothers' organization. "Bipartisan" gangsters - of Six and otherwise - are pushing "debt reduction" in an unemployment-wracked and crumbling nation whose national debt payments are half of what they were (as a percentage of GDP) during the financial showdown of 1995. And the non-Fox major news outlets in this country continue to repeat the deficit falsehoods cooked up by right-wing billionaire Pete Peterson's foundation as if they were facts. Most voters object to these austerity policies, yet leaders in both parties are promoting them while the American majority goes unheard. Resistance seems futile.

But the Murdoch story holds a lesson for everyone who longs for justice: Even when your opponents seem to hold overwhelming power, a change may be just around the corner. Even when they seem invincible, the tiniest crack may bring down an entire edifice. So never give up the fight. Never - even when it seems hopeless. Especially when it seems hopeless.

Thin-skinned politicians who are annoyed by these reminders might want to remember the words of abolitionist William Lloyd Garrison. "Little boldness is needed to assail the opinions and practices of notoriously wicked men," said Garrison, "but to rebuke great and good men for their conduct, and to impeach their discernment, is the highest effort of moral courage." Slavery seemed like an indestructible institution when Garrison began his work, but thanks to his tireless efforts and those of his fellow irritants it was abolished in his lifetime. "I am aware that many object to the severity of my language," Garrison said, "but is there not cause for severity?" Hey, the guy sounds like a blogger.

Empires are powerful, but they do fall. A wall crumbles in Berlin. A street vendor gets slapped by a cop in Tunisia. A public that's indifferent to reports of criminality at News of the World is repulsed by the deletion of a murdered child's phone messages. Today's "this is how the world works" deal-making becomes tomorrow's career-killing scandal ... or worse.

Bankers broke the law and got away with it. They held the economy hostage and demanded a king's ransom from the public. Then they laughed in its face when they got it. But the littlest things can turn the tide. Someday they may defraud the wrong pension fund or illegally foreclose on the wrong home. Sure, they're riding high these days, but they - and their allies - should never forget the ancient lesson that history has taught us a thousand times over:

Never, never bet against the house.


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Could Wall Street Ever Face a "Murdoch Moment"?

Wednesday, 20 July 2011 04:19 By Richard RJ Eskow, The Campaign for America's Future | Op-Ed

History books record an empire's fall as a series of dates and events. Battles are fought, people resist, elections are called, arrest warrants are issued. But those are just details. An empire really falls in that moment when people stop believing that it's invulnerable. Whenever the spell is broken, whether it's by anger or just by awareness, the end becomes inevitable. It doesn't matter what happens to Rupert or James Murdoch now. They may return to positions of relative wealth and privilege or their lives may take unpleasant turns. Either way, the Murdoch empire has already fallen.

There's a lesson here for anyone who thinks the safest and surest path to success is by serving the seemingly invincible. Sure, it may lead to riches and power, at least for a while. But you may also wind up like those powerful people in Great Britain who now find themselves struggling with scandal, hiding in fear, or facing terrible legal consequences - all because they believed in Murdoch's invincibility and served him accordingly. As Martin Luther King often said (and we've often quoted), "The moral arc of the Universe is long, but it bends toward justice."

And since the Universe is our home, the Murdoch scandal reminds us of another principle too: "Never bet against the house."

Betting against the house. That's what those Scotland Yard officials did (if they're guilty) by taking NewsCorp bribes. It's what the current Prime Minister did by softpedaling bribery rumors and hiring a Murdoch editor as his press secretary. ("Hacking crisis edges closer to Cameron," says one headline.) The previous Prime Minister bet against the house, too - and now says he was effectively blackmailed by NewsCorp in a particularly abhorrent way over a sick child. And yet he said nothing.

Politicians and journalists were afraid to cross the invincible Murdoch, and we're told that Wall Street's power is unassailable, too. It seems impossible to imagine our uncrowned heads of finance facing a Murdoch-like fall, especially after the free ride they've enjoyed for the last few years. Despite a well-documented record of fraud, corruption, and abuse, they're all free as birds (birds of prey, that is). Not content with freedom or unearned wealth, they're even outraged that they don't have more of everything - more power, more money, more prestige. Let the Murdoch story remind them: Don't overplay your hand. And don't be too sure that your day of reckoning isn't coming.

Moral compromise can be seen everywhere in Washington, even among people who undoubtedly think of themselves as ethical and upright. From Sheila Bair, outgoing head of the FDIC: "If I heard that once, I heard it a thousand times. 'Citi is systemic, you have to do this.' No analysis, no meaningful discussion. It was very frustrating." (Peter Orszag left his job as the President's budget director to work for Citigroup.) JPMorgan Chase has a long history of corporate misdeeds and malfeasance leading to large financial settlements (the latest was last week), all without criminal prosecution. Yet its CEO continues to complain about Washington's insufficient fealty. (One of his senior executives recently became the President's Chief of Staff.)

We now know that allowing banks to investigate their own misdeeds and avoid prosecution has been Justice Department policy under both President Bush and President Obama. Murdoch's organization was allowed to investigate itself, too, and suddenly a lot of people are paying a price for that decision.

Click here to sign up for Truthout’s daily email updates.

But if Democrats have blurred the line, at least they've also pushed for some modest regulation of the financial industry. Republicans, on the other hand, have established new land speed records for the fastest delivery of cheap-shot takedowns, phony arguments, and obstructionism in the service of cash-bearing Wall Street bigshots. With a few notable exceptions, their only posture toward Wall Street has been that of an obsequious valet who serves an imperious master. You can't protect the nation from a banker's abuses if you're also shining his shoes and adjusting his cummerbund.

"Will that be all, Sir?"

The GOP's latest attempt at bank-directed character assassination has backfired. Because Mr. Issa's inquisitors demanded the internal records of the bipartisan Financial Crisis Inquiry Commission, we now know that Commissioner Peter Wallison (and perhaps others) did very questionable things - things designed to help Republicans in Congress overthrow Dodd/Frank regulatory reform, and which to all appearances violate the oath of office for a Commissioner.

You can call this sudden reversal in the GOP's fortunes whatever you want: payback, karma, or just a good run of luck. But whatever you call these reversals, they can shift the balance of power when you least expect it.

Our economy's statistics paint the picture of unchecked bank power, of a nation in thrall to an occupying financial force that's draining it of its lifeblood. Consider the evidence: Ten banks now own 77 percent of all bank assets in this country, up from 55 percent in 2002. Most people fear for our economic future and think we're still in a recession (because they are in one, even if Wall Street isn't).

After a national scandal and lawsuits from all fifty states, the banks' robosigning fraud continues. And after getting a pass for documented corruption and conflict of interest, unreliable US ratings "agencies" (really private companies who have been given too much power by the government) just gave the President of the United States the back of their hand. They'll rate junk bonds AAA to please a customer, but they they don't feel they need to please a government that's already served them so well. (Bet some folks wish they'd thrown the book at them when their misdeeds first came to light.)

It's their world, to paraphrase Sam and Dave, we're just living in it. Corporate-owned Republicans are passing legislation written in the bowels of the billionaire Koch Brothers' organization. "Bipartisan" gangsters - of Six and otherwise - are pushing "debt reduction" in an unemployment-wracked and crumbling nation whose national debt payments are half of what they were (as a percentage of GDP) during the financial showdown of 1995. And the non-Fox major news outlets in this country continue to repeat the deficit falsehoods cooked up by right-wing billionaire Pete Peterson's foundation as if they were facts. Most voters object to these austerity policies, yet leaders in both parties are promoting them while the American majority goes unheard. Resistance seems futile.

But the Murdoch story holds a lesson for everyone who longs for justice: Even when your opponents seem to hold overwhelming power, a change may be just around the corner. Even when they seem invincible, the tiniest crack may bring down an entire edifice. So never give up the fight. Never - even when it seems hopeless. Especially when it seems hopeless.

Thin-skinned politicians who are annoyed by these reminders might want to remember the words of abolitionist William Lloyd Garrison. "Little boldness is needed to assail the opinions and practices of notoriously wicked men," said Garrison, "but to rebuke great and good men for their conduct, and to impeach their discernment, is the highest effort of moral courage." Slavery seemed like an indestructible institution when Garrison began his work, but thanks to his tireless efforts and those of his fellow irritants it was abolished in his lifetime. "I am aware that many object to the severity of my language," Garrison said, "but is there not cause for severity?" Hey, the guy sounds like a blogger.

Empires are powerful, but they do fall. A wall crumbles in Berlin. A street vendor gets slapped by a cop in Tunisia. A public that's indifferent to reports of criminality at News of the World is repulsed by the deletion of a murdered child's phone messages. Today's "this is how the world works" deal-making becomes tomorrow's career-killing scandal ... or worse.

Bankers broke the law and got away with it. They held the economy hostage and demanded a king's ransom from the public. Then they laughed in its face when they got it. But the littlest things can turn the tide. Someday they may defraud the wrong pension fund or illegally foreclose on the wrong home. Sure, they're riding high these days, but they - and their allies - should never forget the ancient lesson that history has taught us a thousand times over:

Never, never bet against the house.


Hide Comments

blog comments powered by Disqus