Ben Bernanke says financial executives should have been arrested and charged with crimes:
With publication of his memoir, The Courage to Act, on
Tuesday by W.W. Norton & Co., Bernanke has some thoughts about what
went right and what went wrong. For one thing, he says that more
corporate executives should have gone to jail for their misdeeds. The
Justice Department and other law-enforcement agencies focused on
indicting or threatening to indict financial firms, he notes, “but it
would have been my preference to have more investigation of individual
action, since obviously everything what went wrong or was illegal was
done by some individual, not by an abstract firm.”He also offers a
detailed rebuttal to critics who argue the government could and should
have done more to rescue Lehman Brothers from bankruptcy in the worst
weekend of a tumultuous time. “We were very, very determined not to let
it collapse,” he says. “But we were out of bullets at that point.”Still,
he does acknowledge some missteps by the Fed. Analysts were slow to
realize just how serious the economic downturn would become, and he
faults himself for not doing more to explain to Americans why it was in
their interests to rescue the financial firms that had helped cause it.
Needless to say, I will be reading and reviewing this book in the near future. And I will be very, very, very surprised if Mr. Bernanke manages to convince me that he is doing anything except whitewash his record. The idea that it was essential to rescue the financial firms that are still preying on the American economy and weighing it down is simply nonsensical. The Federal Reserve didn’t succeed in anything except kicking the can down the road and ensure that the next crisis will be even more severe.