Why are banks getting into trouble?

Recently is seems that financial institutions are plagued by scandal after scandal, whether it is Madoff, MFGlobal, the Barclay´s LIBOR mess, MPMorgan, or the Robo signing fraud in mortgages, etc.  Actually we should not be surprised.  We have a situation where breaking the law, and taking very risky actions is profitable.  In a functioning market incompetent companies are eliminated.  But we are in the era of too big to fail, also known as the era of no consequences, and banks are not allowed to feel the effects of their malfeasance.  Bailing out incompetent banks goes back decades to at least the Savings & Loan scandal. Over time a culture of corruption has been allowed to grow and flourish with impunity.

Neither is the government effectively regulating the banks to keep them in line.  Banks can break the law, and if they get caught, they only have to pay a fine, which is almost always less than what they earned by breaking the law in the first place.  No one ever seems to go to jail anymore, at least if that person works for a large financial institution.

Spain is in austerity now, but there appears to be 100 Billion Euros laying around to save the incompetent banks.  Many of their directors earned millions in compensation, while they ran their banks into the ground, and they get to keep the money, while hospitals have to cut back.

The same is true in the UK where Cameron is cutting back on social services, but then makes a sweetheart deal with Richard Branson, to sell to him billions of pounds of quality loans, thus enabling him to make out like a bandit.

After 4 years of bank crisis, we still have not reinstated Glass-Stegal, despite the fact that almost everyone agrees that repealing the law is what set the stage for the trouble that we are in now.

It is obvious that the banks have taken control of our governments and are allowed to run riot.  The people need to stand up and let our leaders know that we have had enough.  And if we are not satisfied, we will vote them out of office.  It is time for a change in parties and a wholesale cleaning of the political class.  People need to stop the pointless partisan tribalistic bickering and focus on the bigger picture, which is corruption in government, and the need to get special interests our of the government.  Those in power love to see the people exhaust and distract themselves in endless partisan squabbling, while the elites are able to make off with the safe.  Divide and conquer.  I suspect that a lot of the rabid hatred towards the Tea Party movement by the left is a divide and conquer strategy.  If The Tea Party and the Occupy movement can spend all of their time fighting each other, then there is little energy left to fight the corruption and abuse of power by those running the country.  The Tea Party and Occupy are really just two sides of the same coin.  They are both grassroots organizations of people fed up with business as usual.  They should be united, but instead they are at each other´s throats (mostly because the left has been brimming with hated for the Tea Party since day one…for some reason).

In terms of who is screwing up the country it is not a either- or situation.  Both big business AND the government are the problem, and increasingly they are so in bed with each other, that they are often hard to tell apart.  There is a fusion between big business and government which is toxic.  But those on the left want to talk about how bad corporations are, while too often ignoring abuse and corruption in government, because big government is seen as a good ideologically.  The right is often guilty of the same but in reverse, focusing on big government, but giving corporations a pass too often.  In the end it is just two heads of the same hydra, and both need to be controlled.

Another thing that I hate are those who are so partisan that they will always excuse the mess that their own party makes with the excuse that “at least they are not the other party”.  There are lots of people who will vote for Obama, no matter how bad he is, because “at least he is not Romney”.  Any Republicans do the same overlooking Romney´s considerable shortcomings, because “at least he is not Obama”.  Politicians love these kinds of voters, because they never hold their leaders accountable.

It is time to say “None of the above!” and vote in fresh blood.  Our ruling class has failed us and needs to go.  Do not allow yourself to fall into the trap of the dualolopy of our two party system, which offers little choice, and less genuine reform.  In the next election please vote for a third party candidate.


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