Indeed, where has the Department of Justice been all these years, when the banks were becoming "too big to fail," and now (per Eric Holder's insinuation) "too big to jail?" Where were the antitrust suits? Where are they now?
To a major extent, the bigness of these financial institutions is the issue -- the fact that they're so ingrained into our economy as to be deemed untouchable, save for infinitesimal borrowing rates and occasional cash transfusions.
In many cases it's hard to draw clear distinctions between "government" and "finance industry," as some pretty connected foxes were guarding the henhouse before, during, and after the crisis.
Government failed us here, big time, and continues to fail us. But let's not let the culprits off the hook, nonetheless. The reason our government gives this industry a pat on the back, a few trill, and an 'atta-boy every time it fucks up is because this industry has made a concerted effort to buy off the government. And it has.
The problem is that the banks never became "too big to fail" and they should have been left to fail, and then we wouldn't have this problem.
But some politicians were all "oh no!!! we can't let these banks fail!!! the stock market would collapse and unemployment could spike over 10%." And then the stock market collapsed anyway and unemployment spiked over 10%.
As comfortable as this logic feels, the fallout would have been even worse had the banks been left to fail. That's basically what we did in the 1930s. Didn't turn out so well.
Some sort of bailout, unfortunately, needed to happen to keep the world from going completely Mad Max. But the bailout should have come with conditions: new regulations, enforcement with actual teeth, and trust-busting breakups of institutions on the receiving end. None of that happened.
For the record: prosecutions of top execs, while warranted in many cases, are little more than sideshows. They're basically conducted for appearances. They do nothing to stop the next CEOs from going right back to business as usual. What really matter are antitrust policies, regulations, and enforcement.
Among other things, sure. That we have the FDIC now wouldn't have stopped a significant depression from happening had we simply allowed the financial sector to collapse.
To a major extent, the bigness of these financial institutions is the issue -- the fact that they're so ingrained into our economy as to be deemed untouchable, save for infinitesimal borrowing rates and occasional cash transfusions.
In many cases it's hard to draw clear distinctions between "government" and "finance industry," as some pretty connected foxes were guarding the henhouse before, during, and after the crisis.
Government failed us here, big time, and continues to fail us. But let's not let the culprits off the hook, nonetheless. The reason our government gives this industry a pat on the back, a few trill, and an 'atta-boy every time it fucks up is because this industry has made a concerted effort to buy off the government. And it has.