Deregulation of the financial industry – the reign of anarchy destined to blow up the markets and the global economy — started in 1999 with repeal of the 1933 Glass-Steagall Act. Clinton was president, but Republicans controlled congress. In the Senate, all 53 Republicans voted for repeal along with exactly ONE Democrat. That opened the gates to the orgy of lax supervision and non-supervision of bankers and Wall Street freebooters.
Throughout this feeding frenzy, apostles of deregulation have overwhelmingly come from the hardcore, ideological right wing, egged on by financial industry lobbyists.
And for nearly eight of these nine years, the Bush administration has not only been obliterating federal oversight of the markets but also failing to enforce even the patchy and often toothless regulations still on the books – and firing or demoting any honest civil servant who actually tries to do his job.
Not just one party? Let's not get so reasonable and so ritualistically consensual that we lose track of reality.
Sure we all share some responsibility – for everyone and everything – but real crimes are committed by real criminals, and the more quickly you forget the sooner they'll do it again.
These Republican outrages have cost countless people their jobs and their homes and cost millions of others their peace of mind and the ability to take good care of their families.
Right winger (now rich lobbyist) Phil Gramm, John McCain's “financial guru,” engineered the Enron Loophole when he was in the Senate – exempting energy trading from regulators, leaving Enron free to rape the ratepayers and taxpayers of California – after which his wife Wendy joined Enron's Board.
Gramm was also the principal enabler of the subprime mortgage meltdown.
Mother Jones has dubbed him Foreclosure Phil. He sneaked a measure into the 2000 budget at the last minute — largely written by financial industry lobbyists and unread by most of the Senators voting on the budget – barring the SEC and the Commodity Futures Trading Commission from regulating exotic swindles like bundling worthless mortgages.
Meantime Henry Paulson (yes, that guy), then head of Goldman Sachs, was after the SEC to get rid of some silly regulation that prevented investment bankers and hedge funds from using leverage up to 40-1 (You invest 10 million to control 400 million. You can make a fortune, and if later the investment goes bad, you get a bailout and the taxpayers have to cover your losses while you go home to count your accumulated bonuses). At that time the limit was 15-1, or 1,500% — fairly ample, wouldn't you think?
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