In the last few weeks, major banks such as JPMorgan Chase, Citigroup and Barclays have announced that they are once again setting aside billions of dollars in reserves to pay fines expected to be levied against them by regulators, this time for conspiring to manipulate foreign-exchange markets for their own profit at the expense of their customers.
"It seems to be a never-ending refrain: Misconduct by traders and bankers is uncovered, multiple regulators mount investigations, and then millions, or even billions, of dollars in penalties are paid, all to little apparent effect.
The problem is that the misconduct never seems to abate, shifting instead from one unit to another inside companies whose thousands of employees are under relentless pressure to produce profits. So the intended message from all the expected big settlements seems to go largely unheeded."
As Henning goes on to document, even 9-figure, multi-billion-dollar fines against the big banks have become just the cost of doing business. Nobody ever goes to jail. Regulators are frantically playing catch-up and never quite do so. And to the bankers, a billion-dollar fine can be made up in profits (and often written off on taxes) in just a matter of a few weeks. (JPMorgan Chase, for example, reported profits of $5.6 billion in just the third quarter).
When 63 percent of Americans say in exit polls that they believe the economic system is tilted in favor of the wealthy, this is in part what they are talking about. And when 32 percent say that the system is fair, this is what they are willfully ignoring.
So what do we do about it?
Well, you'll be pleased to know that Mitch McConnell has a plan and has already promised to make it a priority once he becomes Senate majority leader in January. His plan is to gut regulation of the banking industry by undoing much of the Dodd-Frank bill -- he calls it "ObamaCare for the banking industry" -- that was passed in the wake of the finance industry's meltdown in 2008. Republicans also plan to attack the Consumer Finance Protection Bureau, another post-crash response that banks find inconvenient because its mission is to protect individual consumers.
Now, freeing the "struggling" banking industry from the shackles of already insufficient regulation was probably not what voters had in mind when they demanded change in Washington. However, it was clearly what the finance, investment and commercial banking sectors had in mind when they invested so heavily in this year's election. Those sectors gave McConnell alone some $5.7 million in contributions, not counting the money that went quietly into "independent" groups that supported him.
So this is what we've come to; this is how our system works in favor of Wall Street at the expense of Main Street. This is how government contributes to the growing concentration of wealth in fewer and fewer hands, to the detriment of the economy at large, and how the growing concentration of wealth reinvests a small portion of that wealth into the politicians who protect it. And if Democrats can't find their voice on such critical matters, if they can't find the words or more important the will that is needed to explain it to the American public, they deserve to lose.
That certainly includes presumptive presidential nominee Hillary Clinton, who in her time as a senator from New York reached her own accommodation with Wall Street. Economic insecurity and injustice was the most important issue of the 2014 midterms, even if it was expressed in a vague, anguished cry for change. It will certainly be the most important issue of the 2016 campaign, and it demands a cogent, articulate champion on behalf of the American people.
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