Every once in a while a writer feels like jumping up and down, congratulating, even evangelizing a fellow. An article in the LA Times by Michael Hiltzik has provoked just this response for us here at EPR. What did Hiltzik hit on? Nothing less than the essence of the mortgage settlement hype spreading about. Our politicians and bankers, and their “mutual gratification society” – to put it bluntly.
Recalling grand oratory from the past, the hype Washington delivers to all of us now resounds of their efforts building a “Cathedral of the Spirit” – when in reality our “high adventure” does in fact equal “grim sacrifice.” (watch the video at the end of this post)
Google the term “mortgage” while drinking your morning coffee. Then hit “news” – your query will result in 21,600 results (more or less) looking about as polarized as the upcoming election contentions. Yes, your news is even more political than in the halls of Congress, played out as vehemently as any lobbyist effort. But logic and common sense prevail in Hiltzik’s assessment. The gist of his story boils down to big banks ending up “insulated” from further backlash, lawsuits, and loss, BECAUSE of this deal. How’s that for serving the American people?
It turns out, some states retain the right to make banks toe the line on mortgages etc., but this settlement brought forth by Obama all but eliminates the possibility for broader cases. Of note, Arizona and Nevada versus Bank of America. “Speeding relief to the hardest hit American homeowners,” as Obama puts it, also shores up the banks’ legal defense teams. The fact of the matter is, the $25 billion mortgage fraud settlement may just be a “pig in a poke” – costing more than the advertised beneficiaries receive. Why?
Bank of America, Citibank, Wells Fargo & Co., JP Morgan Chase and Ally Financial don’t even pay out the cash in the settlement, this reality is the banks only lay out about $5 billion collectively. The rest of the “advertised” billions in relief amounts to giving distressed homeowners a break. You know, refinancing and other slack cut for human beings who are customers. Modifications and “caring” banks allude to when they need your business, the kind of stuff you see in TV commercials, this is what Obama’s big deal involves. Banks doing business correctly, saving money by reducing foreclosures! Now there’s a deal any politician can sell.
Michael Hiltzik nails it all down in his words, as for mine? I think the American people would be far better served, feel more reward, with a few public hangings. As the LA Times author so aptly, the deal “requires mortgage lenders and servicers to comply with what anyone would think was already the law,” to paraphrase him. Not just a “slap on the wrist” – a huge press op for politicians and bankers to benefit from what should have been all along. Do you feel offended yet? I do. The “most abusive” practice American see these days involve utterly insulting hype.
If my rant here does not get a few of you steaming mad, head on over to Naked Capitalism, Hiltzik links to author Susan Webber (AKA Yves Smith) who lays out the “top twelve reasons why this deal stinks.” Among this “stinking” variables Webber is steamed about, even more widespread abuses not covered makes my BS alarm start buzzing. A PR tactic to reverse the negative effects, or “heading those investigating off at the pass” – this aspect seems worth studying. It seems like, at every turn, this whole Wall Street/Great Recession story is about scapegoats and redirects.
There’s an old saying from the movie “All the President’s Men” that tells of where responsibility and power emanates from in any deal, it goes; “Follow the Money.” This deal shows clearly who wields the power in the United States (the world), and it is decidedly not the people. Which way is the money really flowing?
For those of you out there enamored with the “charisma” of Barack Obama, or the depth of Ivy League power brokering, a speech given back in 1969 promised a new era of worldwide brotherhood and progress. In this, perhaps the American people can begin to scrutinize the deals of Washington. All of Washington.
Candor, hope, class struggle, God, goodness, decency, kindness, love, and the battleground where spirit and humanity meet, all these things have been discussed since when. Call me too philosophical if you will, just learn to discern the truth, please.
Photo credit – courtesy © Eyematrix – Fotolia.com
About Phil Butler
