Wednesday, July 10, 2013
Paper Backtime: Bank-Rolling Stone Cold
The premise in Matt Taibbi's Griftopia is that the financial manipulation in America goes far beyond the political distractions of Right and Left. In fact, no news organization can tell this story because of the corporate tentacles that claw at them. So leave it to a renegade writer from Rolling Stone magazine to not only dissect every facet of the financial crisis, but brazenly firebomb the villains - in a literary sense of course.
Taibbi's style has scared off many of the cable news networks, and has even proven to be too off-color for Real Time with Bill Maher, where he used to be a semi-regular. But after referring to Michelle Malkin in ungentlemanly (putting it mildly) terms, he has scared away some of the most fearless shows. Malkin may be an idiot, but she's not a dartboard for misogynistic imagery.
Anyway, Taibbi has more than earned his stripes as a journalist, a war correspondent, a campaign reporter, and someone who has brought the complexities of America's 30-year financial implosion to Joe Sixpack.
I'm that guy. I don't have an MBA. I didn't work on Wall Street (except that one summer on a trading desk when I was 18). And while I try to be well-read and have my finger on current events, I really don't know much about high finance. But thanks to Mr. Taibbi and this fascinating, excoriating, and sadly funny book, I think I can hold my own next time I'm sipping my chardonnay at the country club.
Taibbi had me at Chapter 2, titled The Biggest Asshole In The Universe. It's all about Alan Greenspan, a direct disciple of Ayn Rand's objectivism, how he ushered in the deregulation of everything over the course of four presidencies, and presided over every bubble to insure the hyperbolic disparity of wealth that exists in America today.
Greenspan's latest and greatest act was encouraging homeowners to tap into the equity in their homes, as if their mortgage was an ATM. The surge in debt, coupled with unchecked predatory lending was a key in the 2008 financial disaster.
Why is Greenspan still so revered? Republicans know his ties to Rand, as well as his history as a champion of the free market, making regulations disappear. Democrats? To put it simply, he's married to MSNBC icon Andrea Mitchell. So he's untouchable at the most liberal (lowercase l) of the news networks. And Taibbi goes to great lengths in describing how Greenspan has historically positioned himself that way with the elite intelligentsia.
And while many immediately label Taibbi, thanks to his anti-establishment street cred, and Rolling Stone business card as a (capital L) Liberal, he spends at least one chapter in this book destroying The Trillion-Dollar Band-Aid, aka Obamacare.
What Obamacare does (Taibbi argues) is rather than reform a corrupt health insurance industry, it emboldens it. And while it does in fact cover more Americans, it lines the pockets of the filthy rich insurance companies for decades to come. It's the ultimate long-con.
Only in America can this plan, which was originally hatched by The Heritage Foundation and later implemented by a severely conservative Governor who would go on to run for President, be viewed as a socialistic policy. The mission of House Republicans to repeal the bill is a Presidential politics sideshow, like throwing bread to the cheap seats at a Roman Coliseum.
The financial mess we're in is a classic situation of the rich getting richer. And the rich buy the best lawyers and the legal system. Sure Bernie Madoff got caught, but what about the biggest fish from the big banks? Nothing.
A lot of the tricks are too complicated to explain to the American public, aka me. How can you explain a monster like Goldman Sachs carving up a bunch of high-risk mortgages into AAA-rated securities, and selling them off to pension funds just so they can get bailed out when they go under. That's not a soundbite, it's a calculated scheme.
And it's not a Left or Right thing, there are plenty of bad guys on both sides. Every administration is saturated with Wall Street cronies. While we argue about abortion or guns or immigration, a few thousand Americans laugh and count their money.
In addition to Taibbi deconstructing the whole fiasco, he does an exceptional job in the epilogue tying the whole thing up.
"The Democrats' response to Wall Street excess was similar to their attitude toward the Iraq war - they were against it in theory, but in practice, they weren't going to do much about it."
Notice how he used "Democrats" and "their" in the same sentence. Wonder if he thinks of Elizabeth Warren as one of "them" or "us" - I have a pretty good idea.
The book ends perfectly, on the heels of the mortgage crisis, an addendum from Taibbi's Rolling Stone article in November 2010 Invasion of the Home Snatchers:
"When you meet people who are losing their homes in this foreclosure crisis, they almost all have the same look of deep shame and anguish. Nowhere else on this planet is it such a crime to be down on your luck, even if you were put there by some of the world's richest banks, which continue to rake in record profits purely because they got a big fat handout from the government...
That's why one banker CEO after another keeps going on TV to explain that despite their own deceptive loans and fraudulent paperwork, the real problem is these deadbeat homeowners who won't pay their fucking bills. And that's why most people in this country are so ready to buy that explanation. Because in America, it's far more shameful to owe money than it is to steal it."