Bill Black was very instrumental in the resolution of the S&L crisis. He appeared on the Bill Moyers show on Friday and did not mince words about our current crisis.
Fraud was rampant. The FBI warned about this fraud in 2004 but 9/11 resulted in the transfer of agents specializing in white-collar crime being transferred to GWOT and not being replaced. Of course, the repeal of Glass-Steagall and the passing of legislation excluding derivatives from regulation did not help.
Black, a supporter of Obama in the election, is not pleased with Obama's decisions in the financial arena. He asks a question many of us have - why fire Wagoner but not any bank presidents? Black's answer - Geithner etal are much closer to the bankers and he wants to prevent the facts from being revealed. He asks another rather basic question, "So, as long as I keep the old CEO who caused the problems, is he going to go vigorously around finding the problems? Finding the frauds?"
Black believes that Geithner etal are scared of a collapse if they tell us that many large banks are insolvent. He thinks the American people can take reality. He keeps coming back to this issue of facts - what happened, why, how can we prevent it from happening again. As he says, "you need good information to make good decisions." The refusal to give us these facts bespeaks a fundamental lack of integrity, the same issue that got us into this mess.
A minor point he makes, 'the folks who are better regulators, they paid their taxes." Who does that bring to mind?
Black does make us ask, once more, how well is the Obama administration handling this mess.
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