Bill Black is in particularly fine form in this Real News Network video. Black recounts the various excuses for not prosecuting the parties that blew up the global economy, and gives a new one from the Justice Department: that regulators told them that yanking bank charters would blow up the global economy. Of course that’s a straw man; Black and others who’ve been serious about prosecution have stressed the importance of targeting individuals.
And we continue to get far too many apologies for the lack of prosecutions. Jesse Eisenger, for instance, argued last week that the Justice Department had been too bold and successful in going after Andersen as part of the Enron bankruptcy; it led to a “counteroffensive” by the corporate bar. But this again was the prosecution of companies; Eisenger fails to offer convincing explanations as to the failure to go after individuals successfully. Hint: despite his explicitly saying the reverse, it really was lack of nerve. The Justice Department badly botched its prosecution of two CDO fund managers at Bear Stearns who were if anything victims and went into retreat. And as we’ve said, having Geithner at Treasury and Robert Khuzami as head of enforcement at the SEC didn’t help either.
Real prosecutors like Eliot Spitzer and Neil Barofsky disagree vehemently with the “it’s all too hard/Corporate America is too well defended” palaver. As those who saw the movie Inside Job may recall, Spitzer laid out a simple way to go after Wall Street: hit firm employees with charging drugs and prostitutes to research budgets (this practice is so common that it’s even discussed in thinly disguised personal memoirs like ex Goldmanite CDO salesman Tetsuya Ishikawa’s How I Caused the Credit Crunch.
In case you’ve got friends and colleagues who’d like better talking points as to why the banks (or more accurately banksters) got away with murder, this segment is a great place to start.