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.