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Thursday, March 07, 2013

Too big to jail

Karl Denninger considers the Attorney General's recent admission that the big banks are above the law:
The Rule of Law works and guides a just society only because it applies to everyone.  Nobody gets to rape, rob, pillage or murder.  If you do, no matter who you are, you face the same punishment, the same process, the same sentence.

We all know there are disparities in the process and always have been.  But there's a difference between the foibles of mankind -- everyone has their bias, and there is no such thing as a human process that is flawless -- and intentional, designed-in or willful refusal to prosecute certain people for acts that land others in prison.

The latter is the defining action of a dictatorship.

A dictatorship can only exist by declaring war upon the people.  When a certain subset of the population is given license to pillage or worse that is the very definition of "diktat" from which the term "dictatorship" comes.

Fast and Furious, incidentally, falls into this category as well.

This is an extraordinarily dangerous state of affairs and must not be permitted to continue.  The government and its actors have lost all moral and ethical appeal to fair play and the rule of law -- by exempting certain people they have declared both themselves and those they exempted beyond the protections that exist in a civilized society.
I've previously pointed out that there is no longer "law" as such, in the United States any more.  Everything about the "nation", which is no longer, properly speaking, even a nation anymore, is fraudulent, from its "money" to its system of "justice".  Even something as simple and basic as openly fighting a "war" is now beyond its bloated, cancerous make-believe structure.

I wouldn't call the present system a dictatorship myself.  Dictatorships are more open and direct.  It is better described as a simulatorship, which is to say, rule by pretense.  It is remniscent of the latter days of the Soviet empire, when the Russian people pretended to work and the Soviet government pretended to pay them.  In the latter days of the US empire, the federal government pretends its actions are within the limits set by the U.S. Constitution and the American people pretend to believe them.

If a corporate entity is too big to fail or too big to jail, then logic dictates it must be cut down to a size that permits both.  Remember, corporations are not capitalism, they are creations of government and if they can't reasonably be imprisoned, they can certainly be "executed".  And if real American people can be "legally" executed at the order of the president, then can there really be any doubt that artificial American people are also liable to termination on command as well?

This section of the American Banker article particularly struck home:
Many are still angry about the 2008 bank bailouts, and they now have an on-the-record confirmation from Justice's top official that the department is treating big banks softly just because they are large. Compare it to how law enforcement typically treats American citizens when they break the law — often times by throwing the book at them — and it's easy to understand how that anger could grow into more popular support for a big bank breakup.
For example, my father was imprisoned for 12 years after being accused of evading $1.6 million in taxes, penalties, and imaginary "interest" despite having paid something like $75 million in state and federal taxes over the previous 20 years and forcing the State of Minnesota to admit that its agents knowingly lied when they falsely claimed he was a resident and seized his house for not paying taxes he didn't owe. Meanwhile, Congressional investigators estimate that the big US banks launder about $250 billion in drug money every year in addition to their $12 billion in estimated annual mortgage fraud.  When caught, they occasionally pay a monetary penalty calculated at a rate which, in my father's case, would have amounted to about a $20,000 fine.

So, I can understand why many Americans support a big bank breakup and seeing corporate criminals treated with the same severity as actual human beings.  But it's not going to happen, because the entire financial system is already on the verge of collapse and all of the insiders know it.  That is why the banks will continue doing whatever they want and the regulators and politicians will continue to look the other way, until the moment when a critical node fails and the entire system breaks down in a manner that can't be blamed on anyone in particular.

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39 Comments:

Anonymous Outlaw X March 07, 2013 6:07 AM  

TTTJ (To tired to jail.) Guess that is where I fall. Considering your Dads situation he is a better man than me. All he has done for those around him and he will not be a good man in this world and in the scheme of eternity. May God bless him.

Anonymous Outlaw x March 07, 2013 6:09 AM  

"He is a good man in this world" I meant to type, see too tired.

Anonymous trk March 07, 2013 7:29 AM  

Its not going to happen b/c of the revolving door between big banks and the government. Get elected for office, support banks, then when your term is up you work for the bank, then after 5 or 6 years, you get onto a committee or advisor for the new guy who is in office (regardless if its repub or demo), then after a while you go back to a new bank...rinse...repeat...

Anonymous Anonymous March 07, 2013 7:32 AM  

Holy Shite, Vox!

No wonder you don't have a dog in American politics - or any other aspect of the country.

Anonymous Houston March 07, 2013 7:32 AM  

Vox's last phrase, "in a manner that can't be blamed on anyone in particular", also reveals the motivation behind the coming drone assassinations of American citizens on U.S. soil. They will be political murders concealed by layer upon layer of plausible deniability, so that guilt for the crimes cannot be assigned to the officials who ordered their commission.

Anonymous realmatt March 07, 2013 7:35 AM  

Round them up and shoot them. If it could somehow be done all in one night we might be able to pull it off. It would take a lot of planning and orchestration of course.

How is your father doing Vox? Though I never met him and only know what I read and the little bit youve said about him I've always had a lot of respect for him.

Anonymous realmatt March 07, 2013 7:41 AM  

Did any of you watch the questioning of the attorney general late last night on cspan? Sen. Cruz spent several minutes trying to get him to say either yes or no to a question regarding the constitutionality of a hypothetical scenario. He just kept saying 'appropriate' . These people are going to be the end of us all and Western Civilization as a whole if they arent stopped.

Cockroaches and the Greeks will be all that survive.

Blogger Nate March 07, 2013 7:50 AM  

"To big to fail" is a rabbity notion is ever there was one. Its rooted in the paralyzing fear of change and upsetting the warren.

Anonymous Stilicho March 07, 2013 7:54 AM  

Satan's greatest trick was convincing large numbers of people that the state is god.

Anonymous Steve Canyon March 07, 2013 7:56 AM  

Justice may be blind, but it can sure smell a buck.

Anonymous Godfrey March 07, 2013 8:20 AM  

President Stepin Fetchit and his gaggle of circus clowns.

Blogger tz March 07, 2013 8:20 AM  

until the moment when a critical node fails and the entire system breaks down in a manner that can't be blamed on anyone in particular.

Not that it won't be blamed on anyone, but I'm glad Hussein Hoover-bama will preside over this.

Hubris even destroys the bankers eventually. It has several times even our history. A large part of the reason for small government is that the wealthy will corrupt it - the poor can't. The shell game is to empower more poor with the vote (direct elect senators, women's suffrage) and have them vote bigger government. Then they simply take it over. Fraud? No, only the SEC can bother about that - you know the revolving door between wall street and their cubicles. Vandalism? No, let the EPA take care of that. Rape? See the EEOC. What is missed is the traditional Catholic "preference for the poor" - which simply meant that the playing field needed to be leveled so the rich could not escape justice now means the rich are the judges and juries for their fellow rich people when they rape and pillage.

My standard for a law at the state or federal level is simple. Would I feel safe is someone who is literally demon possessed (and demons want to kill and destroy humanity) gets to enforce and interpret the law?

The Constitution is something like a giant magic spell designed to keep the demon bottled up. Between poking holes and actually calling the demon to cross the boundary (living document means undead zombie apocalypse), it cannot protect. But to reuse my analogy, Many fences aren't to keep you in but to keep something evil out - tearing it down gives you the freedom to go beyond your bounds, but it also gives the horrors (think Lovecraft) that were kept on the far side to cross into your homestead.

Blogger Eric March 07, 2013 8:53 AM  

Sam Francis called this anarcho-tyranny:

"[W]e refuse to control real criminals (that's the anarchy) so we control the innocent (that's the tyranny)."

Anonymous Thales March 07, 2013 8:59 AM  

The sad part is that Mr. Holder is correct -- the corruption is everywhere. It would be like a sheriff in a thoroughly corrupt town trying to put the entire population in jail – impractical/where would one begin/what would be the point? The poster child of this mess is Jon Corzine, Democrat/governor/regulator/CEO/thief (quite the D&D multiclass).

The solution is that God nukes the entire town for want of a single good man, which we can take metaphorically of course, but we all know how this ends.

Anonymous VD March 07, 2013 9:01 AM  

How is your father doing Vox? Though I never met him and only know what I read and the little bit youve said about him I've always had a lot of respect for him.

He's doing well. He turned himself into a jailhouse lawyer, spends most of his time writing appeals for his fellow prisoners, and has gotten unjustly convicted prisoners released from hundreds of years of combined jail time to date. As you can probably imagine, he's highly respected by his fellow inmates.

Anonymous scoobius dubious March 07, 2013 9:21 AM  

"Cockroaches and the Greeks will be all that survive."

You left somebody rather obvious out of that one.

"until the moment when a critical node fails and the entire system breaks down in a manner that can't be blamed on anyone in particular."

Oh, I reckon we'll all have a pretty good idea of who in particular to blame. Plus ca change, plus c'est la meme chose. You know, it's weird. If you don't want to be constantly blamed for car-crashes, then a good way to begin your new blame-free regimen would be to stop always pathologically grabbing the steering wheel.


Blogger JartStar March 07, 2013 9:40 AM  

But it's not going to happen, because the entire financial system is already on the verge of collapse and all of the insiders know it.

The question is if this latest run-up in equities is the last, or just one of the last gasps. How many more QEs are left?

Anonymous The other skeptic March 07, 2013 10:01 AM  

Too black to deport

Interesting that we are seeing a spate of killings of white women by black males.

Anonymous James May March 07, 2013 10:28 AM  

Financial dealings centered around such things as eliminating the uptick rule on short selling stocks from 1938 to 2007 and easing restrictions on how banks package the loans they hold and use them to play poker has allowed Wall St. and the stock market to basically indulge in legal piracy pretty much out in the open.

Banks have gotten to big to fail because gov't has allowed them to. The new option traders and fake LIBOR reports introduce volatility into the market and pirates can take their cut coming and going.

The banks and stock market are one big casino with the rules in their favor. Look at the DOW in the last 4 years: trending upward but with unprecedented volatility getting there. There's only one place for the DOW to go at this point and that's down. It slaughter time. Time to reap profit before the next miraculous recovery.

If one were a cynic, one could imagine that all playing out in time and concert for the next Presidential election. You can't fire a President for the DOW plummeting so 2014 would sound about right for the DOW to fall and then rise so Hillary can put on a leisure suit and take the helm.

I notice Apple is down another 10 since I last mentioned it doing exactly that and 50 in the last month, all with the appropriate volatility. 420 now, look for it to go below 300 and the DOW with it in the next 18 months. Maybe even 250. Profit all the way. Then, right back up, profit all the way. The stock market is smoke, mirrors and your little dog too.

Anonymous dh March 07, 2013 10:31 AM  

He's doing well. He turned himself into a jailhouse lawyer, spends most of his time writing appeals for his fellow prisoners, and has gotten unjustly convicted prisoners released from hundreds of years of combined jail time to date. As you can probably imagine, he's highly respected by his fellow inmates.

This is really great. Glad to hear he's doing well.

Anonymous rycamor March 07, 2013 10:59 AM  

Yes, collapse will be pushed out to the point where it can't be blamed on anyone in particular, thereby ensuring that when it comes, it will be cataclysmic and chaotic. I have a bad feeling about this...

Anonymous John Regan March 07, 2013 11:30 AM  

It's true that the insiders know it, although I wonder if it's so much a conscious knowledge as it is more of an instinct they can't articulate.

It's also true that no one can stop it, at least not without turning everything inside out. A jubilee by law - constitutional amendment - could do that peacefully, but the chances of that happening are too slim to seriously consider.

We are doomed.

VD, sorry about your dad. I, too, am glad to hear he's doing as well as can be expected under the circumstances.

Anonymous CMC March 07, 2013 11:34 AM  

Thanks for this post. Still upset about the 2008 bailouts and the whole too big to fail BS, and appreciate you doing the calculation and laying out this concrete example. And for all the other posts over the years too, thanks again.

Anonymous Mike M. March 07, 2013 11:43 AM  

There's one thing that keeps me wondering...If you look at the French Revolution, it was a revolt of the upper middle class against a non-tax-paying aristocracy that appeared to operate above the law.

I think we are close to this today.

Maybe it's time to get my rent-a-guillotine business started. "A basket for every budget"

Blogger Scott March 07, 2013 11:53 AM  

@the other sketpic
If enough 16 year old girls die, maybe people will figure out the problem. I mean, I doubt it but it's hard for me to feel bad for a lot of people who experience vibrancy first hand. She was probably a card carrying swpl whose parents should have given her the Derb talk.

Anonymous Other Josh March 07, 2013 11:56 AM  

"He's doing well. He turned himself into a jailhouse lawyer, spends most of his time writing appeals for his fellow prisoners, and has gotten unjustly convicted prisoners released from hundreds of years of combined jail time to date. As you can probably imagine, he's highly respected by his fellow inmates."

That is awesome. That reminds me of the story of Joseph in the book of Genesis. He was falsely accused by Potipher's wife and imprisoned for crimes he didn't commit. But in prison, he was such a man of integrity the jailor placed him in charge of the jail - and God used this to eventually get him in contact with Pharoah and make him 2nd in command of all Egypt.

Summarized: Joseph never lost his integrity in a bad situation, and it sounds like your dad is doing the same. Kudos to him. God will richly reward him for it, whether in this world or the next.

Anonymous patrick kelly March 07, 2013 12:05 PM  

"He turned himself into a jailhouse lawyer, spends most of his time writing appeals for his fellow prisoners, and has gotten unjustly convicted prisoners released from hundreds of years of combined jail time to date. As you can probably imagine, he's highly respected by his fellow inmates."

This has to be the highlight of my reading of this blog for many years. Even in the belly of the beast, evil has not triumphed over your father, even there he battles it by doing good for others. Well done good and faithful servant.

Anonymous Molon Rouge March 07, 2013 12:09 PM  

Love the word, cockroaches, especially Tony Montana's verbal version. He said something like cockarooches. Good linguistic fun for all.

Anyway,the banking system/Country is coming to a head soon. Do all intelligent folk move to Italy? Do we place our declining dollars in bullion?

What is the most rational plan of action?

Anonymous Jack Amok March 07, 2013 12:35 PM  

until the moment when a critical node fails and the entire system breaks down in a manner that can't be blamed on anyone in particular

Well, at least not on someone internal to the system. I think the way Rabbit Power Players operate is they try to kick the can down the road and perpetuate a fiction until a convenient opportunity to blame someone comes along. Then they let something fail and point at the Emmanuel Goldstein of the moment.

I suspect the Obamanoids first preference is to use the threat of pain in the "Sequester" to consolidate more money and power, but the next best thing from their POV would be to use the crisis to unload some obligations and blame it all on "obstructionist Republicans."

Anonymous Jack Amok March 07, 2013 12:41 PM  

"To big to fail" is a rabbity notion is ever there was one. Its rooted in the paralyzing fear of change and upsetting the warren.

And the profound discomfort rabbits feel at ever publically judging another member of the warren. Well, I suppose that's a subset of "upsetting" the warren, but I think that's a very important thing to understand about rabbits and the world they create - it's all designed around avoiding anyone taking personal responsibility.

Anonymous Outlaw X March 07, 2013 1:57 PM  

PK
This has to be the highlight of my reading of this blog for many years. Even in the belly of the beast, evil has not triumphed over your father, even there he battles it by doing good for others. Well done good and faithful servant.

After watching the initial interview with that man I saw his soul. He is a damn good man.

Vox sshould be proud to have a dad way ahead of the times.

Anonymous Porky March 07, 2013 2:36 PM  

Eric Holder is a nascent Goebbels.

Blogger Ciphra Summam March 07, 2013 4:48 PM  

Too big to fail should be an absolute qualifier for anti-trust intervention. You don't see the justice department banging on any doors about it though.

Anonymous Stilicho March 07, 2013 6:39 PM  

If you had any doubts about the nature of our banking system, just look at the goals of one of its principal architects:Harry Dexter White

Anonymous civilServant March 07, 2013 8:41 PM  

What is the most rational plan of action?

Find a nation or other location that accomodates you. If it changes so as not to suit your needs then move on. Repeat as necessary.

"Clean cup, clean cup. Move down."

Anonymous Anonagain March 07, 2013 10:09 PM  

VD March 07, 2013 9:01 AM

He's doing well.


That's good to hear. Your father is one hell of a man. I hope he will be out before too long.

Blogger Wes March 08, 2013 3:59 AM  

Vox, it's good to hear that your father is doing well, despite the conditions that he's living under. I'm glad.

Blogger tz March 08, 2013 4:36 PM  

http://www.rollingstone.com/politics/blogs/taibblog/fallout-from-untouchables-documentary-another-wall-street-whistleblower-gets-reamed-20130304

Blogger James Dixon March 09, 2013 6:41 PM  

> He's doing well.

I'm very glad to hear that.

> There's only one place for the DOW to go at this point and that's down.

Nonsense. The DOW could easily double again before the big fall. Even by Nate's estimates I think we're still almost 3 years out.

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