Elias Isquith interviewed Matt Taibbi, on the immorality of Wall Street, Inequality and Our Broken Justice System. Tabbi's bottom line is that the current political/economic/justice system is so broken it's become organized crime. That creates citizen disrespect, so our system won't work anymore. The assumption behind giving too-big-to-fail financial companies a pass on illegal activities is that they're serving a critical function for our country, that they're actually working properly. They're NOT.
An unspoken assumption undergirding this logic is the idea that these systems which we can’t mess with are actually working.
So we’ve kind of made the strategic decision to resolve these matters with this crude system in which [authorities] just take a check from HSBC for working with drug traffickers, or they take a check from UBS for raiding LIBOR.
Do we give all these companies a pass for robo-signing? For mass perjury? Do we give them a pass for subprime mortgage fraud? Do we give rating agencies a pass for giving out phony ratings? That doesn’t make sense in terms of helping the economy become more functional and more able to serve the needs of everybody. All it really does is allow people to get away with crimes.
… the justification essentially becomes: shit happens. And that’s crazy. It’s total moral surrender, and just like the torture issue, there’s the “How can you judge if you weren’t there?” idea. I mean, that takes away our ability to judge anything if that justification holds. That’s just crazy.
… the entire financial services sector and the regulatory sector. They were very much thrown together in the middle of this crisis, innocent and guilty alike, and they crafted this solution to get us all out of it.
They were the wrong people to judge what was happening during that period. They really needed outside, independent observers to go in and look to see [whether] was this really fraud or [whether] was this market mania, overzealousness. And every sane observer who has looked at it has said it was fraud, it was mass criminality — and [the financial sector is] not really the people you would want to ask for an objective opinion about that stuff.
… the rationale Obama gave when he first announced his economic team. Critics said, “The people you’ve picked to fix this mess are the ones who created it to begin with!” And Obama and his team would say, “Well, who knows it better?”
… these are the people you’re going to bring back to sit in judgment of what went on? They were the people who are screwing up to begin with — exactly the people you don’t want to have looking at this thing.
Morally, it doesn’t work anymore. You just cannot have a society where people instinctively know that certain people are above the law, because it will create total disrespect for authority among everybody else. And that’s completely corrosive. [red emphasis mine]
They didn’t even make a few symbolic prosecutions, and so it leaves the entire public with this glaring statistic that there were no prosecutions and there was massive crime. How does that make anybody else feel? How does it make you feel when you pay a speeding ticket, you can’t write that off, but HSBC can write off its $1.9 billion fine for drug trafficking? People start to think about these things, and they start losing their faith in the system and it doesn’t work anymore.
… expressions all throughout this process. They weren’t crime crimes. Like, what does that even mean? There’s a difference between committing a crime and just breaking the law? There really isn’t a difference, and especially — even when you dig under the service of what the malefactors and the villains in my book did — they really were crimes. If you saw “Scarface” and that scene when Tony Montana is walking into the bank with his duffel bags full of money and walks out without the duffel bags, well, that’s what HSBC was doing, they were washing the money for murderers. Price fixing? I mean, c’mon, that’s what the mafia does. Bribery? The Jefferson County case where they’re bribing local officials to get them into bad swap deals? It’s organized crime. [emphasis mine]
When people ask me what the solutions are to these problems, for me, the fastest shortcut to everything being cleaned up is disentangling the government from its unnatural support of these too-big-to-fail institutions, forcing them to sink or swim on their own in the real free market.
These people, not only are they not being prosecuted, but they’re not subject to the normal forces of the market anymore, and in a way that enables them even more … If you were to force these companies to sink or swim on their own they’d be vaporized instantly. [emphasis mine]