The Sturm und Drang is over. The Bank lobbyists went home to collect their bonuses as the House and Senate agreed on a 2000 page financial "reform" quickly praised by the White House and superficially covered in the press.
The key underreported fact highlighted by Naked Capitalism: "On a flat trading day, financial firms shares rose 2.7% after the deal was announced." Compare that to the market volatility and dire forecasts on Wall Street that followed the call for new financial regulations and you can see who won.
The industry has already figured out how to get around the new law even before it is passed, as expected. What will the Democrats still have to give up for needed votes?
President Obama packed his latest 'triumph" in his bags as he winged North to a bragging session at the G20 meeting in Canada where many countries want far tougher measures, given the depressed state of the global economy. The Financial Times was underwhelmed, as were the nearly one million Americans being cut off from their benefits. Many analysts pointed to loopholes galore in a measure the President labeled the toughest crackdown "since the great depression."
Somehow on cue, Dick Cheney checked back into the hospital, and in Iceland, the scene of the first post-meltdown economic collapse, a comedian from "The Best Party" was elected to head "the largest city."
There is something very comic about all this, but that hasn't stop big media from using the occasion to trumpet the President's assertion of his "command authority," duh, and give him another illusionary achievement to boast about. Financial analyst Yves Smith was dismissive:
So what does the bill accomplish? It inconveniences banks around the margin while failing to reduce the odds of a recurrence of a major financial crisis.
The only two measures I see as genuine accomplishments, the Audit the Fed provisions, and the creation of a consumer financial product bureau, do not address systemic risks. And the consumer protection authority was substantially watered down.
Now what? Already "Dodd-Frank," as the bill is known is being compared to Glass-Steagall, even though it is not reorganizing the banking system or guarding us against giant banks being considered too big to fail. Republicans, including Scott Brown from Massachusetts, the Dems' great white hope in this charade, now threatens to vote against the bill because it assesses fees to pay for costs they incur in the event of their own collapse.
Smith again:
Dodd-Frank effectively anoints the existing banking elite. The bill makes it likely that they will be the future giants of banking as well. Legislators touted changes that would restrict proprietary trading by banks and force them to spin off their swaps desks into separately capitalized operations. But banks get to keep the biggest part of their derivatives business, which is dominated by interest-rate and foreign exchange swaps.
Does this great betrayal sound familiar? Perhaps its just part of a deeper pattern that is not just a commentary on Obama but our whole political culture: Dems dependent on Wall Street for donations, and a media that invariably touts the interests of the status quo.
Meanwhile what's left of the American left is in retreat in Detroit at the Social Forum debating a plethora of important issues but unable, it seems, to agree on a joint program for economic survival. They are more upset with the hideous Israeli embargo on Gaza than our own corporate elites embargo on jobs and justice for American workers. As a result many have become sadly irrelevant in this fight with the exception of some brave members of Congress, and groups like A New Way Forward and Citizens for Financial Reform who stuck to their guns.
As far as prosecuting wrong doers in high places, the pro-corporate Supreme Court this week more than signaled a rejection of statues passed in the wake of the Enron scandal to jail financial criminals. The FBI did carry out the biggest bust in history of mortgage fraudsters this month, but has not touched the Wall Street firms that knowingly securitized and sold fraudulent mortgages and profited from them. (These Wall St billionaires can now retreat to their mansions in East Hampton, where, perhaps not so coincidentally, the Town Government is embroiled in its own financial crime scandal.) Meanwhile 14 million families face foreclosure.
Will prosecutors ever get it together to act?
Does this relate to the financial reform battle? You bet. As reporter Charles Gasperino asked on the Daily Beast: "Why should anyone expect some paper-pushers in Washington to prevent something as complicated as the next great financial meltdown when they couldn't stop Bernie Madoff's Ponzi scheme?'
What to do? I feel like I am fighting a losing battle even trying to distribute my film Plunder the Crime of Our Time (plunderthecrimeofourtime.com), and companion book that argues the case for the financial crisis as a crime story. I would like to think that screenings and discussions nationwide could help stoke a movement to keep this fight for a jailout and economic justice going, at least until the next crash.
Anyone out there want to get involved in helping? Clearly, the compromisers in a compromised Congress have gone as far as they will, or perhaps can, go. It's our challenge to intensify the heat, or step aside and let hypocritical Teabaggers dominate the discourse.
News Dissector Danny Schechter directed the DVD Plunder The Crime of Our Time and In Debt We Trust try to educate and energize a movement for economic justice tapping into the massive anger that's out there. Comments and suggestions to Dissector@mediachannel.org