Progressive Opinion

project-syndicate.org — America’s long-controversial Glass-Steagall Act of 1933, which separated deposit-taking commercial banks from securities-trading investment banks in the United States, is back in the news. This separation long symbolized America’s unusual history of bank regulation – probably the most unusual in the developed world. American banking regulation had long kept U.S. banks small and local (unable to branch across state lines), unlike their European and Japanese equivalents, while limiting their operational capacity (by barring banks from mixing commercial and investment banking). These limits on American banking persisted until the 1990’s, when Congress repealed most of this regulatory structure. Now the idea of a new Glass-Steagall is back, and not only in the U.S.

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sfgate.com — Money laundering. Price fixing. Bid rigging. Securities fraud. Talking about the mob? No, unfortunately. Wall Street. These days, the business sections of newspapers read like rap sheets. GE Capital, JPMorgan Chase, UBS, Wells Fargo and Bank of America tied to a bid-rigging scheme to bilk cities and towns out of interest earnings. ING Direct, HSBC and Standard Chartered Bank facing charges of money laundering. Barclays caught manipulating a key interest rate, costing savers and investors dearly, with a raft of other big banks also under investigation. Not to speak of the unprecedented wrongdoing that precipitated the financial crisis of 2008. Evidence gathered by the Financial Crisis Inquiry Commission clearly demonstrated that the financial crisis was avoidable and due, in no small part, to recklessness and ethical breaches on Wall Street. Yet, it's clear that the unrepentant and the unreformed are still all too present within our banking system.

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otherwords.org — A generation ago, on National Secretary's Day, America's top corporate executives used to take their prized office assistants out to lunch. Times change, and National Secretary's Day has become Administrative Professionals' Day. But something else has changed. These days, CEOs are getting the free lunches. Secretaries and all the rest of us are picking up the tab. And not at Burger King either. Our current tax code has everyone in America essentially subsidizing the pay of millionaire and billionaire CEOs. Deductions, tax credits, and other executive-compensation loopholes total $14.4 billion annually, the equivalent of $46 for each of America's 311 million citizens. That figure appears in "The CEO Hands in Uncle Sam's Pocket," a new report we helped write for the Institute for Policy Studies.

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thenation.com — How good would a Romney-Ryan administration be to the private-equity constituency? According to a study by the chairman's staff of the Joint Economic Committee of Congress, most working Americans who earn under $200,000 a year would see their taxes go up under the latest version of the Ryan budget. By the same token, Mitt Romney would pay less than one percent of his income in taxes. The Romney-Ryan approach, forged and advocated for by candidates with personal and family ties to private-equity concerns, will yield great benefits for those very wealthy Americans who understand private equity as a personal reality. America's robber barons have had to wait for more than a century for a Republican ticket that would truly represent their interests. Every indication is that the Romney-Ryan ticket will be of, by and for the private-equity managers who have become the masters of America's economic universe.

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policyshop.net — It is time to answer two questions: Do the large international banks consider themselves above the law? Do the principal bank regulators in the U.S. -- Treasury, the Fed, the Office of the Comptroller of the Currency and the Justice Department really care? The financial system is a global law unto itself, above the will of the people expressed by Congress. If you doubt this, I recommend that you reflect on the arrogance of Jamie Dimon and the incredulity of Lloyd Blankfein that Senator Levin considered it morally repugnant that Goldman touted new issue securities for sale to clients in a market that the firm believed was on the precipice of collapse.

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rollingstone.com — Last year I spent a lot of time and energy jabbering and gesticulating in public about what seemed to me the most obviously prosecutable offenses detailed in the report – the seemingly blatant perjury before congress of Lloyd Blankfein and other Goldman executives, and the almost comically long list of frauds committed by the company in its desperate effort to unload its crappy “cats and dogs” mortgage-backed inventory. In the notorious Hudson transaction, for instance, Goldman claimed, in writing, that it was fully "aligned" with the interests of its client, Morgan Stanley, because it owned a $6 million slice of the deal. What Goldman left out is that it had a $2 billion short position against the same deal. If that isn’t fraud, Mr. Holder, just what exactly is fraud?

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policyshop.net — Well, that was quick. One day Standard Chartered bank and its powerful allies are complaining that New York's bank regulator, Benjamin Lawsky, has overreached and saying that, at most, they had laundered only $14 million for Iran. The next day -- as in today -- Standard Chartered is agreeing to pay a $340 million civil penalty to settle Lawsky's suit and agreeing, explicitly, that Lawsky's original figure of laundered funds -- a whopping $250 billion -- was correct. As usual with these settlements there is a big focus here on changing future behavior so that illegal activity of this kind doesn't happen again. That's good. What's bad is that, as usual, no specific individuals are being held responsible for breaking the law. We've said it before and we'll say it again: Deterring crime is difficult if no actual people are ever punished.

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inthesetimes.com — The new bosses billed the meeting in late January 2011 as their ‘welcome’ to the 200 workers at a long-established factory in Freeport, Ill. Maybe the description reflected some dark corporate humor lost on the workers, but just three minutes into their welcome, the new managers from Sensata announced that all the jobs in the factory — which produces finely calibrated sensors for the automobile and other industries — would be moved to China or another country by 2013. Sensata is the creation of Bain Capital, a private equity fund co-founded in 1984 by Republican presidential candidate Mitt Romney. Sensata was assembled from various sensor manufacturers in 2006, and it has continued its acquisitions even as the U.S. share of its workforce declines sharply. Bain’s strategy for this basically healthy, moderately high-tech manufacturing sector of the U.S. economy is apparently to transfer all the work offshore.

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nytimes.com — The Knight Capital debacle last week gave us yet another example of the financial system run amok. The company’s computers were apparently misprogrammed. As a result, they caused wild gyrations in the price of several major stocks. This incident naturally brings back memories of the “flash crash” two years ago, when programmed trading sent stock prices plummeting by close to 10 percent for no reason whatsoever. In the era of high-speed trading, it seems that such events are inevitable. Insider trading is bad for markets because it means that normal investors will get a smaller share of the gains. The same holds true with the high-speed trading platforms that now dominate the market. A modest financial speculation tax can go a long way to putting an end to such practices and bringing the markets back to earth.

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creators.com — Hallelujah and Holy Smokes! Wall Street has had a "come to Jesus" moment — the biggest sinner on the Street has repented! He is Sandy Weill, the once-lionized dealmaker who turned our banks into financial "supermarkets" that tie us everyday depositors and Main Street borrowers to the profiteering schemes of unbridled Wall Street traders and the whims of global speculators. Thanks, Sandy — for nothing. Beginning in the late 1980s, Weill went on a decade-long merger binge, taking over Travelers Insurance, Smith Barney, Aetna, Solomon Brothers and other powerhouses of high finance, culminating in 1998 with his grabbing of Citibank. The whole empire was named Citigroup, Weill was paid a king's ransom, and his conglomerated entity was widely hailed as a work of genius. Only one problem: It was illegal.

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