Cross-posted from New Deal 2.0.
The SEC and the Minerals Management Service's (MMS) share a number of characteristics we can't help but notice in the wake of the worst environmental disaster in U.S. history, which followed the second-worst financial disaster in same. We have endured two cataclysms in which a regulatory agency upon which our nation's economy and environment depended failed to meet even the minimum requirements for doing its job. The ecological disaster was aided and abetted by the systematized incompetence and cronyism of the MMS, just as the financial meltdown was stoked by the laxity and inadequacy of the SEC. Both regulatory agencies were designed to fail. At the time of the critical regulatory lapses, they were run by leaders chosen because of their anti-regulatory stance. Both agencies have been failures for at least a decade.
In both instances, the regulators accepted industry assertions about the reliability of their safety mechanisms while failing to acknowledge -- much less investigate -- the darker, more complex reality. In each crisis, we had the same story of a belief in the reporting done by corporations, and in each case, we had a failure to recognize the enormous potential for fraud and the lack of incentives these corporate entities have in ascertaining and measuring potential risks to the public. The regulators continued to believe the lies fed them by CEOs even when the lies had become absurd. Both times, the agencies charged with regulating ignored the advice of their own experts, neglected to enforce rules, and engaged in an alarmingly cozy relationship with the industry they were supposed to be monitoring.
So far, the Obama administration has failed to fully grapple with the weaknesses and corruption of the regulatory agencies meant to guard the public from harm. Across the entire spectrum of regulatory agencies, there exists a dangerous atrophy of infrastructure which may lead to disasters we cannot yet imagine. Maybe now, as the oil slicks spread across the Gulf, killing wildlife and wrecking lives, our false sense of security is dissolving. We hope so, because if we don't learn from these horrific experiences, we can expect more of them. Where will the next disaster occur? At the Food and Drug Administration? At the National Transportation Safety Board? At the Nuclear Regulatory Commission?
The Government Accountability Office (GAO) is supposed to identify "high risk" governmental activities and require that the agencies address any weaknesses. Unfortunately, the GAO has traditionally excluded key regulatory activities from this high risk designation. It has only treated a regulatory activity as "high risk" if the taxpayers were likely to be the direct victims of the fraud or abuse. So far, the GAO has failed to designate either the SEC or MMS' regulatory activities as "high risk" even after recurrent scandals at both agencies that have led to multi-trillion dollar losses and epic catastrophes. That must change. The Obama administration should not only direct regulatory agencies to thoroughly audit themselves, but it must also instruct the GAO to systematically review the agencies' effectiveness and integrity, identify critical weaknesses, and require their timely correction.
Let's not wait for another catastrophe.
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1. Scrapping arms, especially naval after WWI.
2. League of Nations
3. Pearl Harbor
4. Bataan
5. Scraping arms after WWII, especially aircraft
6. Korea
7. Spraying commuters with viruses in the 60's.
8.Three Mile Island
9. World Trade Center Bombing
10. Enron/ WorldCom/Dotcom
11. 9/11
12. Katrina
13. Illegal Immigration
14. Katrina
15. Housing Bubble/Wall Street
16.Haliburton/Iraq
17. Drug War
18. AIG/Bernie Madooff
19.Borrow and Spend
20. Incarcerating more people than the tolerant Chinese.
The Republican mantra has been that they would shrink the size of government until it could fit in a tea cup. In the book "The Wrecking Crew" the author details many of the actions that the Republicans took to accomplish their goal. The result has been to unleash economic and environmental havoc on all of us. We do sit in fear of what is next.
The next thing may be preventing us from gathering information over an open and free internet. The government seems to want to let corporations be the gate keepers over what content goes out over the internet and we know what that means - stalling, stalling and stalling until there is no usable information available to any of us. When was the last time that any of us got reliable information from network or local television?
Crickets
No offense, but you seem to spend a lot of time watching CNBC. Everything you said is almost word-for-word repetition of those taling heads like Maria Bartiromo. I think a day spent watching CNBC will tell you everything you need to know about where our society went wrong.
the ignorance that capitalism is not self destructive and does not lead to corp fascism.
the proof is all around us but few want to see the evidence
why is that?
we have been conditioned to believe that capitalism is the best in the world economic system.
the christian devil itself if it existed could not have come up with a more immoral economic system than capitalism.
think about it corp profits over the needs of its peoples health.
a wall street of immoral greed
pre existing medical conditions to max corp profits.
corp profits that create wars for profits.
child labor in foreign nations to max corp profits.
one out of 8 families in america on food stamps while we fund a mega size industrial military complex for our wars for corp profits.
the list is long but yet we see not. ie the paradigm effect that has lead to paradigm paralysis.
we have been taught there is only socialism or capitalism by the capitalists.
this is conditioned dualistic thinking by the capitalists that there is only socialism or capitalism.
few will understand my words very few.
Unfortunately the disaster in the Gulf is hardly over with, in fact as the White House continues to allow British Petroleum to control the response, they have empowered British Petroleum to add to the already catastrophic result of the regulatory failures. There was an opportunity for the Obama Administration to take charge and limit if not diminish the horrific events following the blown up well 83 days ago. You're invited Messrs. Spitzer and Black to come to Louisiana see for yourself the lack of command and direction from the White House in protecting the Gulf water and animals and livelihoods of its people.
Where is the "Equal Justice Under The Law?"
The "pubic interest" of any of these Governmental Agencies was completely compromised by the Bush/Cheney Wrecking Crew's cronyism and corruption.
Where are the criminal charges?
Where is the Justice?
Sold out and clearly seen.
The SEC has always been woefully underfunded, far too underfunded to conduct any real investigations beyond the most blatant, and easily solvable, cases of insider trading.
It's very disingenuous, or at the very least incorrect, to blame the last administration for the failures of the SEC as neither Clinton nor Carter nor Johnson ever gave them the resources to be even a remotely effective regulatory body.
The current crisis would not have happened without the full participation of Fanny Mae, Freddie MAC, Housing Secretary Cisneros (under Clinton), and tens of thousands of people who bought enormous homes they clearly couldn't afford.
So, sorry Kevin. Main Street, the left, and Washington are as much to blame for the financial crises of the past few years as are AIG, Wall St, and Bushgoat-Cheney, if not more so - and its damn dishonest for Spritzer and Frank to pretend otherwise.
So are you saying that the Wall Street banks that have made billions from this were innocent bystanders?
There was a time when I believe that the U.S. Department of Justice stood for truth and justice but that was a very long time ago and today the more accurate name for this federal department is the U.S. Department of Obstruction of Justice.
This bastion of legalities has been using the peoples money to protect and defend war criminals, mass murderers, trillion dollar swindlers, perjurers and unconstitutional laws.
Ten million dollars was wasted on prosecuting Al-Arian who a jury found innocent of all the 54 charges but was forced to remain in jail on legal technicalities until he pleaded guilty to something he didn't do so he could get out of jail and he still ended up getting a long jail sentence and will be deported once he gets out even though he is innocent and this case is a clue to how rotten and corrupt this department has become.
Billions in tax dollars have been wasted by this criminally irresponsible, corrupt, incompetent department trying to convict 5,000 innocent Americans for terrorism while the worst criminals in U.S. History are ignored.
http://hbr.org/products/1784/1784p4.pdf
“Predictable Surprisesâ€, such as the BP mess, are not singular events, but are rather common outcomes of poor leadership within government or business. Watkins and Brazerman illustrate that organizational leaders and leadership are to blame.
Watkins and Brazerman demonstrate that our physiological, organizational, and political vulnerability run counter to effective preventative processes and intents. Physiologically, we tend to see thing as we wish then to be and not necessarily as things are; we tend to seek out facts that sustain our perceptions and disregard those that are damaging to our perceptions (the perils of ideology perhaps?); we do not take the opportunity to look at what others are doing, therefore we miss the outcomes of their poor decisions and actions (apathy?); and we tend to see in the present tense, and seek to maintain a status quo arrangements which are incapable of making changes necessary to meet future challenges. Organizationally, we tend to arrange complex organizations that make it difficult to share information that could provide for recognition, prioritization and mobilizations against threats. Politically, we tend to suffer from disproportioned power that can be predisposed to regard certain interest groups more so than others; the result is a disproportionate element of influence that rewards the political
I’ll have to fan you for the complement!
http://news.infoshop.org/article.php?story=2010no-accident-bp
Every gulf coast resident should read this.