What began as a bit of political theater in an election year to give the Democrats an edge going into November may well blow up in all their faces as international lawsuits pile up against Goldman and reveal that fraud has become the business model for Wall Street as a whole.
Far from being seen as the savior to rush in and rescue America, DC is rightly seen as complicit going all the way back to the repeal of Glass-Steagal which set the stage for the financial ruin of millions of Americans.
The SEC, the same SEC that sat still for 12 years while Bernie Madoff-with-the-loot savaged his investors for $65 billion now wishes to be seen as a bunch of heroic firefighters, daring the smoke and flames as it busts into the disaster with axes and pours water all over the burning furniture. But SEC forgets that We The People paid them not to wait until the fire could no longer be ignored, but to have prevented the fire in the first place. Thus, the current lawsuit against Goldman Sachs is seen as not a stunning success just ahead of the elections, but a reminder of what the SEC failed to do ten years ago when the damage was still negligible.
In their rush to save us all from carbon dioxide the Federal Government has failed to save us from the human sharks that swim among us and imagine that the gods they hallucinate about set us all upon the Earth to be their helpless prey. Like the police, the Feds show up after the crime has been committed ans the damage done, stand around in their pretty printed jackets, and try to look as good as they can for the cameras.
But the fact is that Goldman Sachs, and Bernie Madoff, and Stanford, Ken Lay, etc. etc. etc. got away with what they got away with because the US Federal Government utterly failed in its primary duty to protect the public, then looted the public to make up the losses when the various schemes started to fall apart. The profits made by Goldman Sachs represent the proceeds from criminal activity, and it therefore follows that when Congress voted through TARP and the other bailouts despite overwhelming public opposition, that Congress aided and abetted those crimes.
Remember how they laughed when they looted America to save their own portfolios?
Remember how I kept saying that the incredible earnings of Wall Street just did not make sense in a nation that had lost substantial portions of its productivity? As Germany, Lehman, etc. all pile on with lawsuits against Goldman, the real nature of Wall Street will be exposed not only to Americans but to the world. The whole mess will come crashing down and far from being seen as the hero trying to save the situation, the Federal Government will be seen as the Captain of a Titanic they stood by and allowed to be steered into the rocks.