It is not uncommon to hear people in the streets, on blogs or on talk radio arguing that the gangs of Wall Street should have been jailed — or even hung — for their crimes against the American people. But to hear that kind of talk from a former Federal Reserve chairman is surprising… even if it is well after the fact.
Though you could be forgiven for assuming most politicians and bankers have no conscience at all, there are apparently many in the halls of power who carry a guilty conscience for their role in selling out the country, and undermining its recovery at every level.
Few have more guilt to carry than the functionaries at the Federal Reserve, the quasi-governmental central bank that now looms so large over the economy, and has so much to do with why the financial world is facing devastating failure all over again.
Against expectations, and in promotion of a book, Ben Bernanke is reflecting upon his time as the head of the Fed with regret that he managed to funnel so much money into the pockets of those on Wall Street — despite the fact that many of its principles played a significant role in causing the 2008 crisis.
Bernanke knows exactly who they are, and what they have done. It isn’t a secret, but no one in the system even pretended to conduct a criminal investigation against them, let alone press charges and prosecute executives.
Now, with the economy ready to take another dive, and possibly crash, and more Americans are forced to shoulder the burden of decline, Ben Bernanke has a few regrets.
Via Fox Business:
Perhaps Ben Bernanke should have spoken up sooner.
Bernanke, the former chair of the Federal Reserve who helped mastermind the massive bank bailouts in the wake of the 2008 financial crisis, says he believes more Wall Street executives should have been held accountable for their roles leading up to the crisis.
While all the major Wall Street firms – J.P. Morgan Chase (JPM), Goldman Sachs (GS), Citigroup (NYSE: C), Bank of America (NYSE: BAC), Wells Fargo (WFC), etc… — have agreed to pay fines now totaling in the hundreds of billions stemming from widespread fraud that occurred ahead of the 2008 meltdown, not a single top Wall Street executive was charged ever as a criminal.
“It would have been my preference to have more investigation of individual action, since obviously everything that went wrong or was illegal was done by some individual, not be an abstract firm. And so in that respect I think that there should have been more accountability at the individual level,” Bernanke said in an interview with USA Today on Sunday.
That’s a pretty bombshell statement, even if it comes in form of Bernanke’s soft-spoken ramblings. Up until now, one would have thought that Helicopter Ben saw nothing wrong with what happened, and that it thought nothing of using the Federal Reserve to essentially put big banks on the easy money financial fast track, and doom everyone else to money that has been devalued by massive quantative easing:
The Fed has come under sharp criticism in some corners for bailing out Wall Street then initiating monetary policies that have seemingly benefitted Wall Street while many Americans are still struggling from fallout related to the crisis. Low interest rates, for instance, have spurred a bull market in stocks that has led to massive profits for many of the same Wall Street firms that were bailed out and which then subsequently agreed to pay billions in fines tied allegations of fraud.
The former Fed chair… blamed ongoing political hostility targeting the Fed on the Fed’s inability to properly communicate what it was doing at the time and why the bailouts were necessary.
The former Federal Reserve chairman has shirked his own responsibility, noting that his job was to save the economy, not to investigate criminal acts by banks or point to guilty individuals.
Indeed, his agency is a privately held one with no powers under the Constitution at all, and precious few checks on its unwarranted power and influence over the lives of all Americans.
As for the idea of prosecuting Wall Street…
That’s the job of the real feds, namely the Justice Department, headed at the time by Eric Holder.
“The Fed is not a law enforcement agency,” he said. “The Department of Justice and others are responsible for that, and a lot of their efforts have been to indict or threaten to indict financial firms. Now a financial firm is of course a legal fiction. It’s not a person. You can’t put a financial firm in jail.”
If you’re wondering why former Attorney General Eric Holder never thought to go after any of the executives from the big banks, consider that he worked for the law firm Covington & Burling for eight years before joining the Obama Administration — a firm whose top clients include Wall Street banks. When Holder finally stepped down as Attorney General, he went back to Covington & Burling, and by extension — right back to work for the very banks whose reckless and sometimes illegal actions triggered all the worst that happened in 2008.
Basically, prosecuting banksters, though it would have been right and would have been cheered by the economically-strained and squeezed population, was a fantasy at best.
The fix was in. Bernanke has blood on his hands, and he knows it. But perhaps he is ready to wash his hands clean… but sincere or not, some are just “too big to jail.”