Economy

One of the most salient analogies of the financial meltdown was offered by Financial Crisis Inquiry Commission chair Phil Angelides when he grilled Goldman Sachs CEO, Lloyd Blankfein, over the firm’s unsavory proprietary trading. Angelides was questioning Goldman’s practice of minting toxic, mortgage-backed securities and badgering credit-rating companies for the highest rating for those securities, while betting in the market that those securities would later fail.

Angelides likened this business practice to “selling someone a car with faulty brakes and then taking out an insurance policy on the driver.” With Friday’s Securities and Exchange Commission (SEC) filing of civil fraud charges against Goldman Sachs, we learned more about those faulty vehicles. We learned that Goldman had cut the brakes.

Last week, in the middle of former Federal Reserve Chairman Alan Greenspan’s testimony in front of the Financial Crisis Inquiry Commission (FCIC), the lights went out.

According to Greenspan, Fannie Mae and Freddie Mac were to blame for the housing bubble. The Fed may have noticed, but it couldn’t really do anything about it. "Regulators cannot successfully use the bully pulpit to manage asset prices, and they cannot calibrate regulation and supervision in response to movements in asset prices. Nor can they fully eliminate the possibility of future crises,” said Greenspan.

After that self-serving drivel, no wonder the God’s zapped the electrical system. There was a lot Greenspan could have done to rein in the housing bubble, not the least of which was simply telling people there was a bubble as housing prices began following an unprecedented and unsustainable path.

If you, like me, are scrambling to complete your taxes, and feeling a bit disgruntled about being taxed more than the big boys on Wall Street, Jobs with Justice has a great plan on how to work out your angst.

Jobs with Justice, the feisty union representing workers in 25 states, is calling for a Tax Wall Street Day of Action on April 15th.

”Big banks helped plunge the nation into the worst financial crisis since the Great Depression. They lobbied for deregulation and corporate tax breaks, then went on a reckless gambling spree, creating complicated, risky mechanisms to make profits off of destabilizing the economy. They have tightened lending for consumers and small business, and they have refused to modify home mortgages. Millions of Americans have lost their homes, their jobs and their retirement savings,” says a Jobs with Justice flyer.

After an exhausting week, I was sticking to my usual routine of collapsing on the couch and tuning in to Bill Moyers Journal on PBS last Friday night. I was excited that one of the guests was www.eji.org Bryan Stevenson, the head of the Equal Justice Initiative, who has long been a hero of mine for his uncompromising, long-term battle against the death penalty.

The show was terrific, a wide-ranging discussion about the struggle for economic justice from Martin Luther King to Barack Obama for "those folks at the bottom of the well," with Stevenson and civil rights lawyer and author of "The New Jim Crow," Michelle Alexander. But deep into the show, well, to tell the shameful truth, I fell asleep. So I missed Moyer's great concluding essay and the big moment when he mentioned the Center for Media and Democracy and our Wall Street Bailout tally. The tally was the product of three months of hard work by our researcher, Conor Kenney, with contributions from half a dozen other staff.