We have been promised by Democrats like Minnesota's U.S. Sen. Amy Klobuchar that if we just passed a bunch of well-intentioned laws, we would never be robbed by those greedy Wall Street overlords. It was the mean, vile bankers and investment gurus that were putting our democracy and economy at risk. If only we passed the Dodd-Frank Wall Street Reform and Consumer Protection Act, all our worries would be fixed. The wise and benevolent federal government would safeguard our money and make all our troubles go away. In fact, from her website, Klobuchar said this:
“The reckless gambling on Wall Street cost millions of Americans their jobs, homes, and nest eggs,” Klobuchar said. “Trillions of dollars in wealth were gambled away because of a financial system that lacked the necessary safeguards to protect Main Street. This bill establishes safeguards to protect our economy and will help bring accountability back to our financial system.”
Accountability? Protect Main Street? Is that what is happening with Jon Corzine and MF Global and over a billion dollars AWOL?
From a story at the Startribune, October 2, 2011, ‘MF Global woes ripple into heartland,’ Jim Spencer reports, “When MF Global declared bankruptcy, farmers like Magnuson and Dean Tofteland, who raises pigs and grows corn and soybeans in Luverne, Minn., thought they were safe. They had been told their money was held in "segregated" accounts to be invested only in their best interest.” What actually happened was a Democratic Party former senator and New Jersey governor, Jon Corzine ran a company that moved their money from these discrete accounts into shady European investments to shore up his interests. While we still don’t know how much money is missing, estimates are now in the 1.2 billion dollar range.
So what is Klobuchar’s reaction to this? "[Regulators] are still investigating if what [MF Global] did was illegal," Klobuchar said in an interview after the hearing. "And it may well have been illegal. We don't know that yet. But what we know is that the law is inadequate when it comes to disclosing transactions like they made ... it is possible that they were able under existing law to hide those risky transactions."
Inadequate? How can that be? We passed the massively intrusive Dodd-Frank financial reform bill over a year ago. According to Klobuchar’s own words, this law was supposed to provide accountability should something nefarious occur with Main Street money. One would be hard-pressed to find a more Main Street group of people than farmers. So why isn’t Jon Corzine, who managed to lead the state of New Jersey and MF Global into financial ruin, in jail? What happened?
“The Senate hearing Thursday showed how difficult it would be to answer such questions. MF Global was allowed to invest in bonds of foreign countries and lend money from one part of the company to another. Federal regulations did not require the risky loans to be recorded on MF Global's balance sheet. Klobuchar called the rules, put in place in 2000 and 2005, ‘part of this Wall Street expansion where basically Wall Street gets to go down the street in their Ferraris and the government's falling behind in a Model-T Ford."
Let’s take Klobuchar’s statement apart. First, Klobuchar calls this theft a skirting of the ‘rules.’ Are we playing Candyland? Did Corzine jump a square and go up a level in Chutes and Ladders? We are talking about theft and misappropriation of funds. The money didn’t just get tired and wander over into a European investment. The fact it didn’t get reported on a balance sheet in the right column isn’t the issue. The money was taken from an account that was supposed to be guarded and used as Monopoly money in foreign investments. Who cares if it was or wasn’t reported? The most vital part is the money was used by Corzine and his lackeys to shore up their other accounts.
Second, even if rules were put in place in 2000 and 2005 (which I don’t believe) Dodd-Frank was supposed to stop any of this. Klobuchar proudly proclaimed she “fought for comprehensive reform in the Wall Street Reform and Consumer Protection Act. This bill contains a number of provisions designed to protect consumers and restore transparency. Those measures include efforts to monitor and address systemic risk, increase accountability at financial firms, and reform the complex derivatives markets.” Once again, this is from her website in the Issues/Legislation tab as of December 3, 2011. The idiotic rules put in place previously should have been washed away with her bright shiny new law. Yet, here we are with Main Street robbed and Jon Corzine free as a bird.
If the federal government is “falling behind in a Model-T Ford,” it’s because Klobuchar put that in place. But, she didn’t give us a Model-T Ford. She gave us a Chevy Volt that is now bursting into flames because someone set a cup of coffee on the hood. Klobuchar was one of the senators making Dodd-Frank’s financial strangulation possible. She owns this law and its failure. It is because of stupid laws like this that provide lanes and paths and reports and byzantine rules and committees of oversight that give plausible deniability to people like the corrupt Corzine. Corzine will throw his accountants and clerks under that bus because they put the wrong number in the wrong column and he will stroll off scot free.
Klobuchar is already laying the groundwork for getting Corzine a pass. It wasn’t Corzine’s criminally fraudulent theft of segregated funds that caused these people to lose their money. It was the system, a system she helped put into place. "I don't have a scandal meter," she said. "I just think it's another example of why we just can't let these financial firms run roughshod over people on Main Street or people who are doing nothing but growing crops or raising pigs. They should not have to know every in and out of the regulatory system to protect their money."
No, Ms. Klobuchar. It was your system that gave people like Corzine a path out of the swamp of idiotic regulations and red tape. We don’t need someone like you passing random laws and promulgating committees and rules, we need actual accountability like sending Corzine to jail so other investment types think twice before robbing farmers to support their risky schemes. But, Klobuchar won’t do that. She will make sure all the heat is on someone else because Corzine is her buddy and her fellow Democrat. And her campaign donor.
From Newjersey.com, May 7, 2011, ‘Corzine still a big political spender,’ Herb Jackson writes:
“Corzine, who shares his time between the New York apartment and his home in Hoboken, is no stranger to big money in politics. He had used his position as chairman of Wall Street powerhouse Goldman Sachs to become one of the nation's biggest "soft money" contributors to Washington Democrats when his name first began circulating in 1999 as a possible Senate candidate.”
Corzine is a big bundler of campaign cash for Obama. He also has given generously to Senate campaigns outside Washington and in his home state of New Jersey. According to the side bar to this story, “Most of the recipients of $111,500 in contributions from former Gov. Jon Corzine and his relatives since he lost the 2009 election were national committees or U.S. Senate candidates in other states.” This includes $1,000 to Sen. Amy Klobuchar, D-MN. He has also provided ample funds to the DNC and the Democratic Senatorial Campaign Committee which also support Klobuchar’s reelection bid.
Given the amount of money Corzine has funneled to the movers and shakers in the Democratic Party, it will not be surprising to see Klobuchar and her Democratic colleagues in the Senate give Corzine the benefit of the doubt. The emphasis going forward will be on the loopholes in the law and not Corzine’s accountability. But, given Klobuchar’s participation in that law, it should be her on trial as well.
No doubt, this accidental journalism by the Startribune in the farmer story will be squelched in the future. Klobuchar will be quoted as seriously questioning and carefully examining the problems with the law. But, this is her baby. She bought this ridiculous farce that Dodd-Frank “establishes safeguards to protect our economy and will help bring accountability back to our financial system.” There are no safeguards for Main Street. There will be no accountability as long as the Democratic Party donors are involved. Jon Corzine will not see the inside of a jail if Klobuchar has her way. He will be dismissed as an incompetent but innocent while others take his rightful place. He’ll just write another check, and it will all go away, courtesy of Klobuchar and her comrades.
Crossposted at Looktruenorth.com