Settling Scores With Wall Street

Settling Scores With Wall Street

A lot of angry people in America are lusting to bring Wall Street geniuses who engineered the financial collapse to justice. And they just might succeed.


America is an angry place just now. President Obama and Congress found out how angry when they hesitated before dropping Tom Daschle. People of all stripes and persuasions had zero patience for yet another tax dodger. It was too damn much.

People are furious, all kinds of people for all kinds of reasons, most of which are good and sufficient, if not always prudent and well thought out, but they’ve used, gamed, duped, lied to, betrayed, ripped off, conned, humiliated, scammed, cheated, plundered, rooked, screwed over, hosed, dissed and dishonored. Americans, left, right and center, have had it.

Some are angry over Guantánamo, Abu Ghraib, the countless deaths–our own and others–in Iraq, waterboarding, torture, eavesdropping, the suspension of habeas corpus and other acts classified as war crimes or crimes against humanity. Many cannot forget and certainly not forgive, as they demand that former President Bush, Dick Cheney–he of the lopsided, evil grimace–and their aides or accomplices should be tried for what they did.

Others are apoplectic about Bob Rubin, the ex-secretary of the treasury, ex-Goldman Sachs, ex-Citigroup guy and his confederates/collaborators. They want them put on trial, those men and women who, in the opinion of the infuriated millions, ruled and raped the financial system. It’s easy to imagine vigilante committees forming to administer frontier justice to the bankers, brokers, hedge fund operators, real estate swindlers, derivative peddlers and bucket shop operators who have cost millions of people their homes, their hopes for a college education, their retirement and, most of all, their jobs.

President Obama has no apparent interest in this, but a significant quadrant of his backers do want to see Bush, Cheney, Rumsfeld et al. brought to some bar of justice somewhere and soon. Any such trial in the United States would split the country in the nastiest kind of division. No one can say what the price of putting an ex-president on trial would be in social cohesion and domestic peace, but to the extent history is a guide, it might be very large.

One of the practices that opened the way for the end of the Roman Republic was vengeance sought on former magistrates for their official acts while in office. The escalating grudge matches led to a series of mass bloodlettings and, ultimately, the end of the Republic and its replacement by a dictator, Julius Caesar.

Statecraft counsels that rendering justice and/or settling scores should be left to whatever international tribunal may take up Bush’s case and can figure out a way to lure him someplace where he can be placed under restraint and brought to trial. Otherwise, let him live in Crawford and take up AIDS, as other recent presidents have, to make people forget bilious acts committed while in the White House.

The financial malefactors, on the other hand, should have to answer for what they have done, otherwise the endless palaver about accountability is just that: words.

They are beyond most criminal law, which is to be expected since the bankers and financiers hire the politicians who write the laws. Civil law is another matter. Given the oversupply of overly clever lawyers, there ought to be a couple of smart ones who can spin together the legal theory on which to sue Rubin and about 200 of the other top people who have brought economic disaster down on our heads.

Rubin may not have been the mastermind–there might not have been one–but he was in the control room throwing switches. As secretary of treasury he played a principal role in making sure nothing was done ten years ago after Brooksley Born, then chairman of the Commodity Futures Trading Commission, warned that unregulated derivatives “pose grave dangers to our economy.” Did they ever!

After leaving the Treasury with the road clear for the puppet masters of high finance to do anything they wanted, Rubin hied himself off to Citigroup, where he was paid $150 million to do his share in bringing the organization to ruin and untold billions in bailout money.

Rubin may be vulnerable under a federal criminal statute that makes it a crime to commit what is called “honest services fraud,” defined as “a scheme or artifice to deprive another of the intangible right of honest services.” A big shot convicted under the law could service as much as twenty years in a federal hostelry. Rubin and the others who drove their companies onto the rocks could be made answerable for their conduct given the right grand jury and a US attorney with a yen to make himself or herself famous.

While Rubin may be the best-known master of disaster, he had many comrades in trading worthless securities–which, by a layman’s definition if not a lawyer’s, is as fraudulent as anything Bernie Madoff is accused of. If we cannot put these people in jail, we can sue the hell out of them, take away their money and give it to the unemployed.

Taking their money away is not as good as a hanging, but seeing them turned out of their mansions with a tin cup and cardboard sign should assuage some of the anger.

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