Tuesday, April 14, 2009


There must be something in the water in Kansas City.

I long ago learned that if I wanted an intelligent take on any major issue in the sports world, my first stop was Jason Whitlock, the Kansas City Star sports columnist who writes with more grace and integrity than almost anyone else in that genre.

When it comes to television and thoughtful insight into the TV trade, one of the most reliable sources is Aaron Barnhart, author of the Kansas City based blog “TV Barn”.

And for the truth about the economy, there are few with more credibility and courage than William K. Black, professor of Law and Economics at the KC campus of the University of Missouri and America’s senior bank regulator during the Savings and Loan scandals of the 1980’s.

Black literally wrote the book on financial fraud. It’s called “The Best Way To Rob A Bank Is To Own One”. And he is now utterly convinced that many of America’s most esteemed and important financial players need to go right to jail for what they’ve done to the world economy. He also believes they are getting away with their crimes with the help of politicians from all parts of the political spectrum.

Last week, he sat down with PBS’s Bill Moyers for 29 of the most shocking minutes I’ve ever seen on television. It’s impossible to come away from the interview without the grim realization that what’s now bad is going to get impossibly worse and that those who profess to have our best interests at heart have a completely different agenda.

No matter what end of the political bench you call home, this is chilling stuff that will give a whole new meaning to who you consider “us” or “them”. And Black’s message is all the darker because he fits nobody’s tidy definition of a wing-nut and unlike the so-called financial journalists of the Main Stream Media, he knows of what he speaks and isn’t afraid to name names or call out somebody you thought was perfectly respectable for what they really are.

This video needs to be seen by and shared with everyone you know. If it resonates with you the way it did with me, please pass it on to every journalist, union member, recently unemployed friend and politician that you know. Pass it on to those who are afraid of losing their pensions and homes, or who have already lost their investment nest eggs.

These are far from issues “too complicated” for the average person to understand or that can be dismissed as “unforeseen” cases of individual greed and corruption. As Black makes clear in the opening moments, “Bernie Madoff was a piker. He doesn’t even get into the front ranks of the Ponzi schemes”.

As Black also makes indelibly obvious, all this talk of bailouts, belt-tightening and credit crunches is just so much BS to keep us distracted from what’s really going on. Keep those torches, pitchforks and tumbrels handy. We might need them after all.


Does anybody remember a little riff that went something like, “No Taxation Without Representation”? If there’s another American Revolution, I’ve got a feeling it might get its start in Kansas City. And given the quality of some of the people who seem to live there, that might be a good thing for all of us.


MCF said...

Thanks Jim, I posted this on my FaceBook page the day after the interview with the hope that all my "friends" would realize there's a lot of substance to "crackpot NWO conspiracy theories". People need to be informed of the realities that undeniablly control our lives - Or else the rest is just garbage. Because I want to tell you something. Things are not always what they seem to be - David Mamet, American Buffalo.

Clint Johnson said...

This is simply how government and business work when the state has the power to regulate toward a politically defined good rather than being restricted to regulating against a concrete and evident wrong.

Mr. Black is wrong in stating that there was massive deregulating- what happened was a wholesale shift in regulation that also allowed for a massive INCREASE in regulation. The problem was that regulatory focus went from keeping the institutions from doing harm to directing them to do what politicians and CEOs defined as "good".

The institutes and politicians decided what good was- and it was an environment that enshrined fraud and filled the politicians campaign coffers with dollars and fodder for rhetoric.

The right crowed about de-regulating business while the left got to crow about how they were forcing the big bad businesses to give loans and mortgages to the poor and downtrodden.

Meanwhile the crooked businessmen made billions... millions of which they turned around and funnelled back into the political machine to keep the gravy train rolling.

Now that the whole mess is collapsing around them, they are colluding to prop it up as long as possible and to protect each other from the legal and political fallout.

Of course this isn't a monolithic conspiracy; the businesses would gladly drive each other into bankruptcy and force a hostile take over - and the Republicans or Democrats would be more than happy to take down the other in a scandal that leaves them with greater political currency. But they are all so intertwined and dirty that they can't push to much without fear of exposing their own complicity.

It may well be that only ten percent of the people who get into business and politics are morally bankrupt but when the rules are stacked in their favour we end up with exactly what is happening right now.

If there is to be class warfare, let it be between those who have class, no matter their socioeconomic status, and those who are completely lacking in class... no matter their socioeconomic status.

The greatest enemy of capitalism is the crooked businessman and the politicians who will sell them privilege, advantage and opportunity in their lust for power.

MCF said...

Why get mired in semantics by saying that Mr. Black was wrong about regulation? If "the problem was that regulatory focus went from keeping the institutions from doing harm" ie: preventing cheating on a nefarious level "to directing them to do what politicians and CEOs defined as "good" ie: abetting crooked businessmen and unscrupulous financiers, to grease the wheels of morally bankupt political parties vying for power, then clearly you are in overall agreement with him. Whether it was < or > regulation that got us here doesn't matter. A sixty-foot Stay-Puff marshmallow man terrorizing NYC is a sixty-foot Stay-Puff marshmallow man terrorizing NYC.
You have also intimated that there is no right or wrong when it comes to attaining power and currency, that this is simply how it works and, of course, there is no monolithic conspiracy. Well, you talk like you're pretty informed, as I'm sure you are, but don't be so complacent before a guy like Mr. Black. He seems to be one of the good guys. And, as much as you may not like to think about it, in the days ahead you're going to have to pick a side.

Clint Johnson said...

My problem with the semantics is that one small segment of what Mr. Black said was incorrect and counterproductive, damaging the message extent. Over time (the last decade especially), the massive increase in regulation has burdened business horribly with little protective service to society - while at the same time actively encouraging the very activities that have brought us to an economic precipice. We could get by better with less than one tenth the regulators and one hundredth the regulations... as long as they are the right regulations.

If the regulations mandate that marshmallow men must be between 64 and 66 feet in height, that everyone must contribute a ton of marshmallow to get a business license and that the resulting marshmallow men must convene on major metropolitan areas to make them ready for community reinvestment in infrastructure... well, we can't blame the lack of regulations for the 65 foot Stay-Puff marshmallow man rampaging through New York.

I find that if I tone down my explicit value judgements when discussing politics and economics it is more conducive to clarity in writing. I will take this moment to out myself as a hard core libertarian capitalist who would be willing to go to the wall for a minarchist form of governing. With the state so limited, it is pretty much irrelevant who is in power and there is very little that the politician can sell to business. The only campaign reform that can keep special interest from buying politicians is to take away what the politicians sell.

I watched the video and I simply saw it as confirmation of my worldview- not a revelation of something unexpected. It disgusted me but certainly didn't surprise me.

A government will always work to loosen any restrictions on its power and business will always work to increase its profit. Good, bad or indifferent, that is what they do and it behooves us to set in place a system of checks and balances upon human nature. It is the state's role to restrict business from doing harm and it is the citizen's role to restrict the state from doing harm. There is an inexorable path when the citizenry can be bought on the campaign trail by the politicians using their confiscatory power and the money that business used to buy them.

The particular form that a government takes is less important than the strength of the restrictions that are placed upon it. A well restricted constitutional monarchy could be every bit as moral and liberal a system as a well restricted constitutional republican democracy. As we can see from the United States government reinterpreting their constitution into whatever form it desires, it can take a relatively short time for the state to suborn a “living document”.

While a perfect constitution is a mythical beast, I would suggest the ancient (probably apocryphal but nonetheless heartwarming) practise of some early Greek states where anyone was free to propose an amendment to the constitution... once they placed a noose around their neck and stood upon a stool.

MCF said...

Well Clint, thanks for that thoughtful, polite, and at times hilarious response. I'm so obviously very out of my league pushing you on this or any other related issue and I sincerely appreciate your patience. I had a very good day yesterday and needed to be taken down a peg or two. So, thanks. Getting schooled by people like you and Jim and a few others in this stream is always most beneficial. All the best.