Senate Banking Investigation of JPMorgan to be Headed by Former JPMorgan LobbyistMay 25th, 2012
This is why regulation never works. Those in charge of doing the regulating must have industry-specific knowledge of what they’re regulating in order to be of any use, which means the government inevitably ends up recruiting regulators who came from the industry they’re supposed to be regulating in the first place. In order to be well-connected enough to become a powerful Washington regulator, these bureaucrats are usually culled from the biggest, most-entrenched, establishment-friendly corporations from within that industry, creating a regulatory bias against the little guy, against entrepreneurs and upstarts that create jobs and innovate to create wealth. Regulation is fundamentally and necessarily a corrupt process and a mere extension of corporate America’s lobbying arm, an extension with the power to do more damage because of the more direct influence over policy and because it has the aura of objectivity and the ascendancy of allegedly being out to protect people rather than simply garner more favor and advantages for the wealthy, well-connected few. This isn’t just my theory, it’s a plainly observable reality…
The latest news about JPMorgan’s multi-billion dollar quarterly loss and subsequent investigation by Congress is just another of myriad examples that prove this is what happens when the government steps in and regulates. The reason is that the staff director for the Senate Banking Committee, which is conducting the investigation, is former J.P. Morgan lobbyist, Dwight Fettig. Check out that link for more of Fettig’s clients– he’s clearly a biased representative of the banksters in big finance, who made half a million dollars lobbying for them and now he’s going to be heading up the Senate investigation for one of his own former clients in big finance. One of the members of the committee, Sen. Mark Warner (D-VA), has over $20 million being managed by JP Morgan and is personally invested in the J.P. Morgan-owned hedge fund that may be impacted by Dodd-Frank reforms related to the proprietary spending practices that are under investigation by the committee Warner sits on.
So does anyone think the investigation of JPMorgan is going to be fair and objective? One of the senators investigating it has millions invested with it. The staff director for the committee investigating it used to be paid by it to lobby for it. He’s taken a pay cut to work as a bureaucrat in the Capitol. You think that’s because he loves America, or because if he makes sure to grease the wheels for his old client, that when he goes back out the revolving door and into lobbying again that he’ll make even more money with the connections he’s made and the results he’s gotten? Oh yeah, and not to mention that JPMorgan has an army of current lobbyists who will have Fettig and Warner’s ear during the investigation. Does this feel right to you? Does it pass the smell test? Should it be taken seriously at all, or am I just imagining that the fact that this is a giant farce is plain as day?
Next time I’m under investigation for something, I’d like to be investigated by my former employees and my current clients, all while they’re actively listening to my current employees who I pay to speak with them and who they’re happy to listen to because they can get benefits for themselves by doing so (like increased job security via the mobilization of campaign and PAC donations). No conflict of interest there at all. I’d also like my investigators to include my girlfriend and my grandma.
Again this is just the latest example of the madness in Washington. According to the Republic Report article revealing this circus for what it is, “K Street lobbyists occupy some of the most important positions in Congress. Tim Johnson isn’t alone in relying on a former lobbyist. At least fifteen freshman Republicans in Congress hired K Street lobbyists as their chiefs of staff in 2010. Two senators, Marco Rubio (R-FL) and Ron Johnson (R-WI), hired lobbyists from the same firm, Navigators Global, to head their office.” Did you catch that part about the Tea Party Republican freshman in 2010? It’s not even a problem with incumbents. It’s far more systemic than that. Earlier this year, Obama nominated a Wall Street banker to… regulate Wall Street Banks. Hmmmm.
The most maddening thing about this is that they’re not even trying to hide it. They don’t have to. As obviously corrupt, scandalous, outrageous, and evil as this is, they do it right out in the open because the American people don’t care enough to call them out on it and demand better. Yes I called this evil. It’s not a hyperbole. I don’t think there’s a better word for it. A system that marginalizes and exploits good, honest, hard-working people, especially one that allegedly exists to protect them from marginalization and exploitation, is evil.
Anyone reading this wonder why Congress has any business investigating a private company’s losses in the first place? Because JPMorgan is not a private company. Like all national banks in the USSA, it’s a federally-insured depository institution and taxpayers are on the hook for its losses, like when they were recently forced to loan it $25,000,000,000 through TARP. But don’t worry, when they lose their customers’ money with risky trading practices, putting your money in jeopardy of another bailout boondoggle, those charged with protecting your tax money aren’t really serious about investigating it and holding it responsible. This is just an easy and profitable way for rich and powerful people to collude and make a lot of money while taking no risks like actual entrepreneurs and innovators. They make you take the risks and they make you take the losses. Worse, they do it all while smiling and saying they represent you. Some might even believe that.
And while it’s all obviously wrong, while they’re all obviously just a big gang of organized thieves, and while people will mostly even agree that they’re corrupt (just look at the historically low approval ratings of Congress), they don’t even bother to hide the blatant appearance of impropriety. They just keep smiling and looking into the camera and saying their lines, and Americans keep voting for them and donating to them. Many Americans are even so naive as to call for more of this system, more regulation, more centralized federal power to fix all these inequalities. This is evil and it’s destroying our lives and it has to come to an end.
What are you going to do about it?
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