I end on the fundamental problems with Geithner’s immunity doctrine and Yglesias’ support for it. The policy represents the intersection of the curves of injustice and stupidity at their respective maxima. Those curves have intersected to produce Secretary Geithner’s policy of protecting from prosecution the elite C-suite criminals who caused the financial crisis and the Great Recession. It is stupidity of truly epic proportions to leave felons in charge of banks. Doing so cannot stabilize a financial system – it is certain to cause recurrent, intensifying crises. When I was a regulator during a financial crisis our agency’s top priority was to prevent frauds from controlling S&Ls. Our second priority was to support the prosecution of those fraudulent leaders.
The injustice of Geithner’s “elite frauds go free” doctrine is every bit as extreme as the stupidity of believing that giving fraudulent CEOs de facto immunity is the road to financial stability. It is a travesty that I have to defend the importance of integrity and justice. No nation can be great if it allows its elites to loot with impunity and prosecutes its whistleblowers. Geithner is destroying the things that made America great. He did so as part of Bush’s wrecking crew and he is doing so now as part of Obama’s wrecking crew.
Bill Black serves as one of the key people documenting the viability of an alternative — not for current politics, which is too far gone for rehabilitation, but for the historians. The whole post at Naked Capitalism is worth a read.