For those of you who defend the "free market system" and the glories of capitalism, here's an example of how failed that is from my backyard. In our small county here in NC - we have 200,000 residents in the city and county combined - our Register of Deeds has determined that 4,500 mortgages have been falsified by Bank of America, Wells Fargo and about 20 other major banks. These mortgages have been signed off on by fictitious people - people who have never worked for the bank of record. There are some so-called vice presidents who have signed off on documents with 25 different and distinct signatures. Not only that, but these same people evidently held vp positions at 3 or more banks at the same time.
Our Register of Deeds has forwarded his findings - and suspects up to 3,000 more fraudulent mortgages will be found - to federal, state and local governments, as well as to the task force comprised of AGs from all 50 states. The banks claim that the fraud was perpetrated by the companies they subcontracted the mortgages to, so they aren't responsible. As if they aren't responsible for vetting the people who process their mortgages.
This whole mortgage mess is what happens when capitalism is allowed to exist without regulations or with no fear of any consequences when they ignore existing regulations. They blame the poor for somehow forcing them to offer mortgages to people who cannot afford them. I have purchased 2 houses in my time and both times the banks required extensive proof of my income - not just pay checks but bank statements, tax returns, credit checks, etc. These seem like normal, accepted practices. But somehow poor people managed to outfox these banks by providing no proof of income and the bank officials signed off on the loans. Sometimes, the poor were so wily that they managed to trick the bank officials into creating a mortgage application with fictitious salaries without ever meeting with the bank official prior to the loan's being approved. If we could only harness the poor's mighty powers for good.
Then, the banks took all of these toxic loans and sold them to investment firms who packaged them into toxic bundles. They were aided and abetted by rating companies like Standard & Poors who gave these sham mortgage packages top level ratings. These toxic investments were then sold and re-sold until the bottom fell out. And the banks paid dearly - they got taxpayer money to keep them from failing. But not to keep them from paying bonuses to the executives who were responsible for this mess. Some of these investment companies actually bet on the failure of these toxic bundles, knowing full well that the mortgages would not hold water. So, they colluded with the banks to profit on other people's misery. Now, Republicans are battling to keep these banks and investment firms from suffering from regulations that will require them to conduct their business in an honest and ethical manner because doing what is right and legal will cut into their profits. You can't fetter capitalism with burdensome rules that interfere with creative ways to rip off average Americans.
All you Ayn Rand supporters must be ecstatic to see her enlightened self interest being practiced so diligently by these captains of finance. However, you might have lost a convert. A local county commissioner here in my home town found out from our Register of Deeds that a property he had paid off 7 years ago was in foreclosure because of a loan he hadn't paid off. The fact is he never took out said loan, and the fact is that the loan was signed by a vp like the one referenced above with the multiple vp positions for several banks and the multiple signatures. So this tea party stalwart, Republican conservative, working man now wants the heads of Bank of America, Wells Fargo, Citibank, etc. on poles to be displayed in his front yard.
I guess that's where capitalism unfettered goes south, when it turns on one of its own. Here's a great idea - based on the banks' performance, why don't we privatize utilities so that they can be capitalistic profit machines. There couldn't be any harm in that, could there?
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