Too Big To Jail


“Attorney General Eric Holder, the top U.S. law-enforcement official, finally admitted this week that bank executives truly are above the law and may commit crimes with virtual impunity.”

— MarketWatch.

If you ever wondered why banker bailout beneficiaries were treated with kid gloves after the financial crisis, it helps to understand that the bankers and the people who regulate the bankers are the same people.

For two years before and during the financial crisis our new Treasury Secretary, Jack Lew, was the COO of Citigroup’s “proprietary trading” group, which engaged in risky trading for the bank’s own account, sometimes in conflict with the bank’s customers.  In those two years he received bonuses of $900,000 . . . Soon after his departure Citigroup failed, and was rescued with $45 billion of taxpayer funds.

A ban on proprietary trading—they’re calling it “Glass-Steagall Lite”—is often said to be the only good part of the bloated and ineffective Dodd-Frank legislation.  Glass-Steagall, repealed in 1999, used to prevent banks from entering the risky and lucrative businesses of Wall Street, and its repeal is often cited as one of the many causes of the financial crisis.  The Treasury Secretary in 1999 was Robert Rubin (banks are regulated by the Treasury Department), and the Director of the White House Budget Office was Jack Lew.

Rubin left Washington soon after, to become a director of Citigroup; chairman of the executive committee and even chairman of the board for a short time during the crucial months that preceded the financial crisis.  Bloomberg News says that Rubin received total compensation of $126,000,000 from Citigroup between 1999 and 2009.


“Nobody on this planet represents more vividly the scam of the banking industry.  He [Rubin] made $120 million from Citibank, which was technically insolvent. And now we, the taxpayers, are paying for it.”

— Nassim Taleb, author of The Black Swan.




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