The Madoff scandal: More than a Ponzi scheme
Were the damage not so great, it would be amusing to see SEC Chairman Chris Cox running around shocked, shocked, that Bernard Madoff had allegedly pulled off the biggest financial fraud in history — and the watchdog was again caught napping. Or worse. The agency ignored years of warnings about Madoff's activities, and Barron's did an article questioning his returns a decade ago. Madoff reportedly bragged about his influence in D.C., including having an in-law who worked for the SEC.
As the victims of the alleged scheme, including many charities, see their investments wiped out, Madoff is out on bond, having to wear an ankle bracelet and stay home. Had he been a minority/poor kid who stole $100 from a cash register drawer, he'd be in county lockup with hardened criminals. Meanwhile, Attorney General Michael Mukasey has recused himself from the investigation, without giving a reason. This is America in the new gilded age, where government has been essentially handed over to the wealthy and connected — and we're surprised they went wilding?
An older America learned from the frauds and follies of the 1920s, including the legendary collapse of the Samuel Insull monopoly. Regulation of securities and banks was put in place, helping to ensure the success of American business for decades through transparency, competition and fairness. That all began to unravel with the Reagan Revolution — but especially in the 1990s with deregulation pushed by Sen. Phil Gramm (R-UBS) and Clinton Treasury Secretary Robert Rubin, a kingpin from Goldman Sachs.
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