Department of Justice
No one went to jail, so why is Wall Street so mad?
Not prosecuting any of the parties responsible for the recession has just served to embolden them
(Credit: Reuters/Joshua Roberts) In Newsweek, Peter Boyer and Peter Schweizer explore the question of President Obama’s Justice Department’s failure to press any major criminal charges against Wall Street. We learn, distressingly, that “finance-fraud prosecutions by the Department of Justice are at 20-year lows.” Ex-Countrywide whistle-blower Eileen Foster, to name one prominent critic of the Justice Department’s inaction, is still urging the Justice Department to do something about her former colleagues, but to no avail. What’s holding them back?
Well, a lot of things. For one, criminal cases for finance-related wrongdoing are hard and complicated to prosecute. The Justice Department is stocked with a lot of people with experience defending financial institutions — including Attorney General Eric Holder, a former partner at Covington & Burling, which represents many of the worst of the mega-banks. Plus, curiously, a lot of Goldman executives and other Wall Street types keep donating lots of money to Obama! (Though less money than they gave him in 2008.) The simple answer is that Holder, and Obama, seem to think that while Wall Street did a lot of stupid, venal things that ruined everyone’s lives, those things were largely … legal. Obama said as much to Rolling Stone: “In some cases, really irresponsible practices that hurt a lot of people might not have been technically against the law.” He might be not entirely wrong! Lots of horrible finance industry practices were and are perfectly legal. But we’ll never quite know whether the line was crossed until we … actually investigate.
So it’s all the odder that Wall Street is so damn mad at Obama, right?
In the only slightly oversimplified narrative of the financial crisis and subsequent recession as you and I and most non-billionaires understand it, Wall Street blew up the world economy, then got bailed out to the tune of billions of dollars, and then resumed being hugely profitable and irresponsible as everyone else suffered through foreclosures, massive debt and mass unemployment. In this narrative, the government, led at various points by members of both parties, did everything in its power to maintain the status quo on Wall Street, while offering primarily temporary relief and various ineffectual half-measures to everyone else. Eventually the Democrats passed some form of “financial regulation” that largely has not yet gone into effect and that will not do much to stem or reverse the financialization of our economy. (The SEC is way, way behind on implenting Dodd-Frank and seems in no great hurry to finish.) The president eventually began noting the existence of mass outrage toward the financial sector, but he did little to actually address that outrage beyond proposing a new tax bracket for millionaires.
So, based on all that, it is very hard to see what Wall Street is so mad about! But as I explained earlier today, most of these rich financial industry titans are also dumb, spoiled children. If anything, the president’s failure to treat the chicanery and fraud that led to the crisis as crimes worth prosecuting had the same effect that his failure to prosecute the architects of Bush’s torture regime had: It emboldened the wrongdoers, who are now convinced that they never did wrong. In this environment, the public’s real and justified outrage at Wall Street is wholly inexplicable to finance types, who blame it on the media and Obama’s occasional rhetorical populism. (He is making people hate bankers by pointing out that people hate bankers!)
Now, in lieu of subpoenas and indictments, we have mild criticism — Obama’s occasional off-message mentions of “fat cat bankers” or whatever — and those mild criticisms set off hysterical waves of paranoia and self-righteous fury. Because no one was hauled off in chains, the people who wreaked so much havoc think it’s actually been established that they did not do wrong.
So Obama has now not succeeded in cowing or placating Wall Street.
Alex Pareene writes about politics for Salon and is the author of "The Rude Guide to Mitt." Email him at apareene@salon.com and follow him on Twitter @pareene More Alex Pareene.
Hiding 9/11′s last secrets
The military tribunal for Khalid Sheikh Mohammed means the American people will never know what drove him to terror
(Credit: Reuters//Brennan Linsley) After a Navy SEAL team killed Osama bin Laden at his Pakistan hideout a year ago this week, it flew his body to the Arabian Sea, weighted it down, and slid it silently off an aircraft carrier into the watery depths.
For many Americans, the secret raid provided a measure of revenge and catharsis for the strikes of Sept. 11, 2001. But it didn’t provide the kind of justice and official reckoning that the country needs to gain real closure. Now the government has a chance to achieve that through a full, fair and open trial of Khalid Sheikh Mohammed and four co-defendants, so the world can finally see the evidence against him as the true architect of the attacks on New York and Washington. The trial kickoff — an arraignment for the men — is scheduled for this Saturday at the U.S.-run detention facility in Guantanamo Bay, Cuba.
Continue Reading CloseJosh Meyer is the author, with Terry McDermott, of the new book, "The Hunt for KSM: Inside the Pursuit and Takedown of the Real 9/11 Mastermind, Khalid Sheikh Mohammed.’’ More Josh Meyer.
Sheriff Joe takes another hit
A Justice Department report blasts the embattled Arizona lawman for discriminating against Latinos
Maricopa County Sheriff Joe Arpaio has seen better days (Credit: Rick Scuteri / Reuters) The clock struck at 1,095 days and 11 hours today for Sheriff Joe Arpaio in Maricopa County, Ariz. — or, at least according to the ticking icon on the Phoenix New Times home page that had asked readers for years: “How long has Sheriff Joe been under investigation by the feds?”
That investigation culminated Thursday when the Civil Rights Division of the Department of Justice released its long-awaited report, which found a “chronic culture of disregard for basic legal and constitutional obligations” in Arpaio’s office. Drawing from tens of thousands of documents and over 400 interviews with sheriff’s department personnel, inmates and experts, the report documented “a widespread pattern or practice of law enforcement and jail activities that discriminate against Latinos,” resulting in gross violations of constitutional rights.
Continue Reading CloseJeff Biggers, the author most recently of "Reckoning at Eagle Creek: The Secret Legacy of Coal in the Heartland," is currently at work on a new book on Arizona politics and history. More Jeff Biggers.
FBI entraps old white guys in terror sting, just like it does to young Muslim men
The Justice Department proves its commitment to equality by indicting right-wing Christians for an unlikely plot
Every now and then, right-wingers like to argue for the inherently violent nature of Islam by pretending the very of idea of a “Christian terrorist” is unimaginably ludicrous. These right-wingers also tend to ignore abortion clinic bombers and other Christian and right-wing murderers who follow the terrorist script, so don’t expect them to devote much time to the story of the Waffle House gang recently indicted by the FBI.
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Alex Pareene writes about politics for Salon and is the author of "The Rude Guide to Mitt." Email him at apareene@salon.com and follow him on Twitter @pareene More Alex Pareene.
Richard Cohen suddenly worried about scope of presidential anti-terror powers
The Washington Post's biggest hack is alarmed to find himself agreeing with -- gasp! -- the ACLU
Richard Cohen (Credit: Sigrid Estrada/Washington Post) Richard Cohen, the universe’s worst opinion columnist, has rather belatedly and unexpectedly grown alarmed at the size and scope of the expensive, unaccountable death machine that is our counter-terror state. Don’t get alarmed — he’s still no bleeding-heart anti-American hippie crying about the “rights” of terrorists who hate us and want to destroy us for our freedom — but the idea that an American citizen’s death warrant can be secretly signed by a couple of Justice Department lawyers seems to have shaken Cohen out of his 40-year fog of elite Beltway complacency. Sort of.
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Alex Pareene writes about politics for Salon and is the author of "The Rude Guide to Mitt." Email him at apareene@salon.com and follow him on Twitter @pareene More Alex Pareene.
Jose Padilla and how American justice functions
A new ruling paves the way for stiffer punishment, while his lawless jailers and torturers walk free
** TO GO WITH PADILLA JUICIO ** ** FILE ** Jose Padilla, center, is escorted to a waiting police vechicle by federal marshals near downtown Miami in this Jan. 5, 2006, file photo. The Bush administration's decision to charge alleged al-Qaida operative Jose Padilla in civilian court resolved one major legal challenge to the president's ability to hold people without charge in the war on terror. But things have not gone smoothly since, with Padilla and his defendants filing dozens of motions seeking access to government secrets and overseas terror detainees and poking holes in the evidence itself. Trial has already been delayed once and now, four months before the case is supposed to go before a jury, it appears to be anything but a slam dunk for the government. (AP Photo/J. Pat Carter)(Credit: Associated Press) (updated below – Update II)
The story of Jose Padilla, continuing through the events of yesterday, expresses so much of the true nature of the War on Terror and especially America’s justice system. In 2002, the American citizen was arrested at Chicago’s O’Hare Airport, publicly labeled by John Ashcroft as The Dirty Bomber, and then imprisoned for the next three years on U.S. soil as an “enemy combatant” without charges of any kind, and denied all contact with the outside world, including even a lawyer. During his lawless incarceration, he was kept not just in extreme solitary confinement but extreme sensory deprivation as well, and was abused and tortured to the point of severe and probably permanent mental incapacity (Bush lawyers told a court that they were unable to produce videos of Padilla’s interrogations because those videos were mysteriously and tragically “lost”).
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Follow Glenn Greenwald on Twitter: @ggreenwald. More Glenn Greenwald.
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