Wednesday, December 17, 2008

Note to Tina Brown. We didn’t “all go mad.” But some of us innocent bystanders are mad as hell about big time financial criminals.

In Wednesday’s Daily Beast, editor Tina Brown covers herself with ashes falling from the financial conflagration lighted by Bernie Madoff, (link) the man at right.

“Did we all go mad?” she asks, that single phrase spreading the blame with all the careless abandon of an investment banker who spreads the risk of a spurious bond portfolio by dumping it on unsuspecting investors.

Was it, she asks, “some strange collective suicide spree of self-indulgence, self-delusion, and blind pursuit of money money money till we drowned in it?”

No, Tina Brown. “We”
did not all go mad.

No Tina Brown. “We” did not all go mad. Rather, unregulated crooks ran amok, aided and abetted by laissez faire politicians, many of whom also profited directly or indirectly from the madness.

As a consequence, millions of innocent bystanders are suffering, although maybe not in your world Tina.

I’m amazed that despite all your editorial skill and connections, the most heart-rending story you could think to publish concerning Madoff comes from a former editor — tellingly of a magazine called “Self” — who complains that now she may have to give up her maid and ride the New York subway. (link)

But certainly in the real world innocent people are suffering grave consequences. That's because the fallout from the Madoff scam, the mortgage meltdown and other scandals gushes through the entire economy, hurting all of society.

How could “we” escape?

Let’s say you wouldn’t touch a derivative with a ten foot pole. You invested only in solid, blue chip companies. Doesn’t matter.

Thanks to our meltdown economy triggered by financial shenanigans, stocks from Procter & Gamble to GE are down, down, down. Bank stocks you reasonably thought were solid are now shipwrecks—Wachovia and WaMu come first to mind. The U.S. Treasury itself, save for its ability to print funnier and funnier money, is on the rocks.

Let’s say you were retired and ultra-cautiously put all your money in insured bank savings accounts, hoping to live off the interest.

Doesn’t matter. Interest rates are more than halved from two years ago — thus more than halving your retirement income, other than Social Security. And your bank may have invested in capers ranging from Madoff's magical money machine to worthless mortgage derivatives.

Moreover, if you need to withdraw some of your savings to survive the currently pathetic interest rates, your monthly interest income will go lower still. And then you'll have to withdraw more principal. And so on, until your savings vanish.

What if, like millions of Americans, your biggest investment was your home? Perhaps you hoped upon retirement to sell it and live on the proceeds. Tough luck. Now, thanks to mortgage market manipulations, you may not be able to sell your home.

What if you had saved and invested a lifetime to put a child through college? Lotsa luck.

In fact, what if you’re the president of a college, or of a hospital that now has a troubled endowment because of the economic wildfire caused by financial arsonists like Bernie Madoff?

Let the punishment
fit the crime!

What ought to be the penalty for those financial thugs and their laissez-faire enablers in government who spread ruin and misery? To start, no more light sentences, community service, or mere fines. It’s time the law and the courts were changed so that the people who cause intense and widespread misery will suffer punishment commensurate with the misery they have created.

Consider: In some states, in murder trials, witnesses may be called during the sentencing phase to make impact statements about the effect a single murder has had on their lives. So why not have the same in trials involving white collar crimes that cause suffering and loss among thousands or even millions of victims?

Let widow after widow, pensioner after pensioner, human ruin after ruin — for hours, or days, or weeks on end — stand in court before the convicted Wall Street thugs.

Let the victims glare straight into the eyes of these crooks, and say, “Because of you my retirement 401(k) is worthless and I can’t afford to eat anything other than bread and cat food.” “Because of you the company I worked for went broke and now at the age of 55 I can’t find a job.” “Because of you, I have no hope.”

They’re not “white collar criminals.”
They’re sociopathic destroyers of lives.

If there are serial and mass murderers, what should we be calling the people who perpetrate mass frauds that ruin so many retirements, deprive young people of their educations, plunge hard-working people by the thousands into misery, and do exponentially more harm to the American economy than the two airplanes that were crashed into the World Trade Center?

Five years in prison for a Bernie Madoff, a Marc Dreier and other schemers yet undiscovered or largely ignored — as well as those in government who should have been stopping them — is the equivalent of a slap on the wrist.

Nor should these crooks ever be pardoned for their crimes, as Michael Milken, is currently asking for his own crimes. A presidential “pardon” for the likes of Milken, the junk bond king of the 1980s, is as unconscionable as the fact that after spending less than two years behind bars he is walking around a free man, one of the 500 riches on the planet thanks to his junk bond exploits, while his PR flacks try to spin his tale of greed and plunder into one of genius, philanthropy and heroism.

Master crooks deserve
maximum sentences

Each life harmed or ruined by financial finaglers reflects a brutal assault against a human being. Financial crooks in many cases have almost the same impact as muggers who lurk at mail boxes and beat up little old ladies for their pension checks. So no more five-year sentences in minimum security prisons, with time off for good behavior. Throw the book at the evil bastards.

Give the guilty the penalties they deserve. For each life ruined, ten years. Each additional life is an additional crime. Sentences for each crime should be served consecutively.

Remember, these are not “white collar criminals.” These are criminal sociopaths, lacking any sense of conscience or empathy for their victims or for society.

Life in prison without
? Why not?

If it can be shown that someone ruined a hundred lives, sentence him, at ten years per life, to a thousand years behind bars. If it can be shown he ruined ten thousand lives, sentence him to 100,000 years. One suspects that victimized America longs to hear a sentencing judge say with a sneer, “What’s your problem? With tune off for good behavior, you’ll be a free man by the end of the 29th Century.”

In other words, throw these sociopaths into a cell, slam the door shut, solder up the keyhole, and let them rot there until they die. They effectively told their innocent victims, the American public, to go to hell. They deserve no less back from us.


Ian Sudano said...

Kudos to you, I agree 100%, my only other thought is that there job from prison should be to cook and serve food to the homeless from their own money and when that runs out then they should be forced to explain why they cant provide anymore.
I hate those thieves but simply going to prison is not enough

JSN said...

I still think Bush is a bigger criminal.

I heard this (allegedly) old saying. Stocks, in this case, being the wooden kind that were popular in colonial America...

Little Criminals Wear Stocks
Big Criminals Wear Silks

I quite appreciate the impact statements idea.

The principle, I'd say, is that these are the people who have been given the most responsibility, and accept the greatest rewards, should face the biggest risks. A rich/powerful/famous person should pay a bigger fine for everything up from jaywalking.