By James Kwak
A few years back I wrote a paper on “cultural capture” in financial regulation. The basic idea is that the industry can achieve the practical result of regulatory capture—industry-friendly policies—not just by bribing regulators (legally or illegally) and not just by providing useful “information” to agencies, but by cultivating other types of influence such as social relationships status advantages. The response was decidedly mixed. Some people said, “Yes, that’s exactly right!” while others said, “Nice idea but how can you prove that it actually happens?”
I completely concede the identification problem. Regulatory decisions are always overdetermined, and it’s hard to find data on, say, how many regulators’ kids go to school with lobbyists’ kids. But sometimes it just hits you between the eyes.
Yesterday the invaluable Jesse Eisinger published the backstory of the SEC’s ABACUS investigation (which will always have a special place in my heart, since the complaint was filed shortly after the publication of 13 Bankers, getting Simon and me a full-hour interview on Bill Moyers and boosting the book up the charts). Eisinger’s story is based on information provided by James Kidney, a veteran SEC lawyer who thought the agency should pursue Goldman senior executives on a broader theory of liability—but was opposed by other insiders and, ultimately, Enforcement Director Robert Khuzami.
And here’s the smoking gun, in an email by Reid Muoio, then head of the team investigating complex mortgage securities (that is, most of the financial crisis):
Let’s leave aside the illogical conclusion: of all the people at Goldman, Tourre most closely fits the description, “good people who have done one bad thing.” His higher-ups, the ones who designed and supervised the whole operation, are the serial wrongdoers. And forget for the moment the obvious contrast with how the justice system treats minor drug offenders.
Muoio’s charging decision is based on sympathy with the entire category of securities law defendants. They’re good people. They’re like us, but for one little mistake. So let’s go easy on them.
Kidney knew what was going on. This is what he wrote in one email: “We must be on guard against any risk that we adopt the thinking of those sponsoring these structures and join the Wall Street Elders, if you will.” The problem is that his colleagues seem to have wanted to be part of the Wall Street Elders—not that they necessarily wanted jobs on Wall Street, but that they wanted to feel like part of the sophisticated club, the people who designed the most complicated financial products ever.
There’s an argument to be made that the SEC couldn’t have won the broader case that Kidney wanted to bring; I can’t judge that from what I can see. But the key thing is, that wasn’t the only factor behind the SEC’s decision to go easy on Goldman.
Kidney explains why he came forward on his blog here. It’s a great read, full of passages like this:
Yessir, according to the Obama administration, Goldman Sachs, JP Morgan, Bank of America, Citibank and other institutions made their contributions to tearing down the economy, but no one was responsible. They are ghost companies.
Enjoy.
The Baseline Scenario 
So far as I can tell, the law hasn’t done one thing right, so legislating the way they do, extending it BEYOND infinity, makes life hard on people like me. So this judge shall not stop charging the law until they reverse their ill gotten gains, which should be close to never according to my calculations.
Jesse’s fine article confirms my premise in my new novel FIxers
https://en.wikipedia.org/wiki/Control_fraud
“Control fraud occurs when a trusted person in a high position of responsibility in a company, corporation, or state subverts the organization and engages in extensive fraud for personal gain. The term Control fraud was coined by William K. Black to refer both to the acts of fraud and to the individuals who commit them.”
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https://en.wikipedia.org/wiki/Corruption
Economist Ian Senior[6] defines corruption as an action to (a) secretly provide (b) a good or a service to a third party (c) so that he or she can influence certain actions which (d) benefit the corrupt, a third party, or both (e) in which the corrupt agent has authority. Daniel Kaufmann,[7] from the World Bank, extends the concept to include ‘legal corruption’ in which power is abused within the confines of the law — as those with power often have the ability to make laws for their protection.
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(moneyed interests run judicial campaigns and try to con / (buy) votes to stack the bench). Corporate interests literally monetarized political
agency and capture is the name of the game!
http://www.thenation.com/article/alec-exposed-koch-connection/
“ Hundreds of ALEC’s model bills and resolutions bear traces of Koch DNA: raw ideas that were once at the fringes but that have been carved into “mainstream” policy through the wealth and will of Charles and David Koch.”
ALEC Exposed: The Koch Connection
By Lisa Graves July 12, 2011
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” Writing in the Canadian magazine Shift, [Bret] Dawson declares: “Our entire culture” — the experiences, icons, images, and archetypes that we collectively call “The West” — “has fallen into private hands,…”
The Privatization of Our Culture
By Leif Utne, February 27, 2002 Issue
http://www.utne.com/community/the-privatization-of-our-culture.aspx
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Everyone likely has used the term “turned a blind eye” to something they would rather not see or in MOB terms,…”better not see”
Yet: if you look up (professionally biased) “cognitive capture” you will find it framed and phrased ans an “inattentive” or “unintentional”
blindness or failure to recognize some distortion or corruption in a system. In other words, there is no such thing as “INTENTIONAL” blind eyes among professional classes. That is cultural capture!
It’s like having possession of marijuana, hey it was a mistake.
@ Michael M Thomas
http://wallstreetonparade.com/2016/03/was-the-first-obama-election-fixed-new-book-raises-suspicions/
Was the First Obama Election Fixed? New Book Raises Suspicions
By Pam Martens: March 14, 2016
“At Wall Street On Parade we call it continuity government. Michael M. Thomas, in a new book of quasi-fiction, calls it Fixers, the idea that no matter who comes and goes in the Oval Office, Wall Street has a fix in to make sure it is protected.”
“The writing of Thomas has an unusually authentic feel in the recounting of the Wall Street frauds and events leading up to and after the 2008 crash, including some events that have been all but forgotten. One reason for the authenticity is that Thomas once worked for Lehman Brothers, intimately understands how the Street thinks, and wrote extensively about Wall Street during the 2008 crash for the New York Observer.
And, along with us, the Black Agenda Report, CounterPunch and others, Thomas was quick to size up Obama as a con man when it came to cleaning up Wall Street. Just five months after President Obama took office in 2009, Thomas wrote at the Observer: “Every day now, as this sorry story plays out, I find myself wondering whether Obama isn’t a bigger Wall Street con than Madoff.”
Unlike in prior Presidential elections, voters actually have a real choice this year. There is one candidate and one candidate only who has no Super Pac, is not reaping windfalls of cash from Wall Street or Big Pharma or Big Oil or corporate lobbyists. That person is Bernie Sanders.
Was the First Obama Election Fixed?
Our political structure is currently a sad state of affairs. The military sets the agenda, and once a president is elected and takes office his political promises go down the drain because he is “briefed” about secrets he “supposedly” had no idea about during the campaign and must now act accordingly to continue the military’s agenda. New terms like national security and phrases like can’t hold a gvt or an economy hostage to “bad” legislation only leads in one direction, the feeding of the corrupt system, it insists upon it at this point, there are no other choices.
Now Bernie might try and give it a run, yet at his age the political resistance would whittle him down to a tooth pick with no teeth left to pick, because the political insiders have even taken the gold out of grandma’s mouth, and would now look into doing the same with grandpa.
I suppose in defining our definitions we might recognize that there are categories of legitimate cultural capture. One example might simply be Rock and Roll. In that regard, Elvis is still alive.
We will here define “corrupt cultural capture” as a negative or perverted operational divergence from an institutionalized public trust for private gain. Cultural capture is a sustained benefit from deceptive occupation of professional stations that hold advantages that are meant to serve the greater good; active of passively directly or indirectly permitting or committing actions that are contrary to the prescribed institutionalized sanction, for the primary purpose of reaping its power over outcomes for private ends.. Complicit or explicit, cultural capture is a strategic and tactical agency implanted for misdirection and intentional manipulation of some power station and its responsibilities. False flag operations that deceive an entire Nation and people is clearly a form of cultural capture. Militarizing the media for the purpose of false patriotism to make warfare look glamorous and killing fields for corporations as a pseudo-patriotic defense of the country; that is cultural capture. A Nobel Peace Prize for a warfare president before he even acts is cultural capture. Creating phony Nobel Laureates in Economics through a Swiss Banks that finance a counterfeit category…these are all corrupt cultural practices meant to capture or sustain some prize. Cultural capture is not the failure of leadership, it is the seizing of leadership for privately directed and deceptive ends.
Let’s be open and honest about this category of cultural capture. The idea that virgin capture theory started with regulatory public trust stations originates with corporate interest that legitimated its capture from the holy hell of the Chicago School of Private Perverted Economics and all their crony influences. The idea that public trust has not been intentional captured across every spectrum is only possible if you believe this is all black and white and all the rest falls in the gray area. Let’s look at a quote from 2009’s Baseline itself:
“Much of the problem arose from decades of deregulation dating back to the beginning of the Reagan administration. Elected deregulators appointed their own kind to head regulatory agencies and they, in turn, removed career regulators from management positions and replaced them with appointees who had worked in or represented the regulated industries. These new managers and, in many cases,the people they recruited and promoted, advanced or adhered to a regulatory scheme that, at least with respect to the most important issues, advanced the interests of the regulated.” James Coffman 2009
https://baselinescenario.com/2009/08/14/an-inside-perspective-on-regulatory-capture/ .
Wow! There is a model for our entire government and the bottom line root of the problem for our entire re-public that has captured global power in the false name of Democracy, Liberty and evasive Freedom.
There are more than 9 lives to this cat. Pulling finance, bankruptcy of profit, looting savings and loans, looting the treasury with the same model, stacking the Supreme Court for profit, and convoluted legislation that circumvents law itself…
It does not end with regulatory capture or with the false notion that a business culture gets perverted and diverted path dependent ideal in practicing their game. It starts with baseline corrupt scenarios that have permeated our culture to capture markets, capture profits and in the process capture our very consciousness with media primed terror and tyranny from its owners …the power relations of self interest and…if you will call it anything…the invisible hand.
Would this be cultural capture?
http://www.naturalnews.com/053767_Margaret_Hamburg_FDA_commissioner_conspiracy_and_racketeering.html
Okay, you win.
From this article:
http://www.huffingtonpost.com/…/the-new-common-ground-bet_b…
“But we’re seeing the emergence of a new debate where the populist left and right are on the same side:
Both are against the rich to spend as much as they want corrupting our democracy.
Both are against crony capitalism.
Both are against corporate welfare.
Both are against another Wall Street bailout.
Both want to stop subsidizing Big Agriculture, Big Oil, and the pharmaceutical industry.
Both want to close the tax loophole for hedge fund partners.
Both want to ban inside trading on Wall Street.
Both want to stop CEOs from pumping up share prices with stock buy-backs … and then cashing in their stock options.
Both want to stop tax deductions of CEO pay over $1 million.
Both want to get big money out of politics, reverse Citizens United, and restore our democracy.
If we join together, we can make these things happen.”
Basically, we have to get these people out of our face, so to speak. Why do they need to be in politics when they have over 2.08 TRILLION among themselves? They are there just to put the hurt on us.
They can take their trillions and stuff it sideways where the sun don’t shine, no on wants their ill-gotten loot dripping with death – we want them out of our face. We want “government” to keep them out of our lives.
The culture capture game is almost over, it’s after midnight and the bartender has made last call, you look around and see the carnage of what’s left, yet find a way to see through it , the desperation the situation has forced me to do accept this. Once the bar closes all that will remain is guilt by association, the elevator is gigantic and the ride down is a long one, their are so few people now riding you could dance in here, but soon it shall be packed like sardines and i’ll be hoping the cable won’t snap or that i’ll wake from the dream of why i’m even here riding on it. The customers have slowly been diminishing as have the drivers who bring them to and from the bar, soon I will have to double as a van driver to keep the joint a jumping.
The place needs no work anymore yet that doesn’t stop my addiction of buying the nails for the nail gun and trying to use them as darts, waiting out the lonely time until that special hour arrives and a second player chooses to throw with me. If one doesn’t soon, i’ll have to take my mind off being my own customer in a couple days, the ranks are thinning but the day still arrives, my boss was a customer not so long ago, a couple detectives are on the schedule this week and every month i grow more anxious about who may be in attendance next, it seems no one is immune from the bar and the game of……corporate culture capture, anymore, not even myself.
Monbiot writes:
The privatisation or marketisation of public services such as energy, water, trains, health, education, roads and prisons has enabled corporations to set up tollbooths in front of essential assets and charge rent, either to citizens or to government, for their use. Rent is another term for unearned income.
Unearned income is what buys elections, and not just in the United States.
(cited from Albert Bates: Hillarism):
http://peaksurfer.blogspot.com/2016/04/hillarism.html
Sunday, April 24, 2016
Hillarism
“The Irish Water crisis, the slow collapse of public health and education, resurgent child poverty, the epidemic of loneliness, offshore tax-avoidance havens, the collapse of ecosystems, Occupy Hong Kong, Australian greedy banks, and the rise of Donald Trump link to a single bad gene in our political DNA.”
In Brooklyn, tens of thousands of voters discovered too late that they were ineligible to vote. The New York City Elections Board confirmed that more than 125,000 Brooklyn voters had been scrubbed from the voter rolls and the NY Attorney General’s office is on the case. Clinton can now win less than half of the remaining primaries and still gain the required number of delegates.
Can she throw some kind of a aikido move on the Trump steamroller? We don’t yet know who controls the machines, but it is a pretty good bet it ain’t the Donald. (Albert Bates)
also noted by Bates: (The Supreme Court of the Philippines recently declared optical scanner counting devices “corrupt” and forced precincts to return to hand counts).
See Bates here: https://plus.google.com/102133440341229405901
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About Bates? Interesting Individual:
Tagline Vanity Fair 2007
“He knows everything, urinates in the forest, and can build a wind-powered generator out of found materials. In the event of an apocalypse, Bates is president.” — Vanity Fair Green Issue, April 2007
BIO Introduction:
Albert Bates is founder and CEO of Global Village Institute for Appropriate Technology. He is a former environmental and civil rights lawyer, author, film documentarian and teacher who has argued before the U.S. Supreme Court and written a number of legislative acts. See, e.g.: http://www.thefarm.org/nuke/nuke.html. He served on the steering committee of Plenty International for 18 years, during which time it received the Right Livelihood Award. He is a co-founder and former president of the Ecovillage Network of the Americas and Global Ecovillage Network and now serves as a United Nations representative for the ecovillage movement. Albert has taught courses in village design, permaculture and natural building to students from more than 50 nations and annually teaches permaculture courses in Central America and Europe. His prescient book, Climate in Crisis (foreword by Al Gore), was one of the first to make the complex science of climate change accessible to the general public, correctly predicting trends that have emerged in the past decades. That work earned The Futurist magazine’s award for top book of 1990. His 13th book was The Financial Collapse Survival Guide and Cookbook (2009), for Kindle, and his 15th is a book about carbon farming and reversing the climate crisis, The Biochar Solution (New Society Publishers, 2010, with a foreword by Vandana Shiva). See also the bio at http://en.wikipedia.org/wiki/Albert_Bates and resumé at http://www.thefarm.org/lifestyle/albertbates/akb.html. His current project is an Indiegogo Campaign. Please share that!
Lest we forget our true TO LIFE Baseline:
CULTURAL CAPTURE IN BLACK AND BLUE
Lewis Powell:
http://www.pbs.org/wnet/supremecourt/personality/sources_document13.html
DOCUMENT DESCRIPTION
In this 1971 memo to Eugene Sydnor at the U.S. Chamber of Commerce, lawyer Lewis Franklin Powell Jr. calls for business to play a more activist role in American politics. The memo was written two months before President Nixon nominated him to the Supreme Court. The memo is credited with inspiring the founding of many conservative think tanks, including the Heritage Foundation, the Cato Institute and the Manhattan Institute.
TRANSCRIPT:
Confidential Memorandum:
Attack of American Free Enterprise System
Date: August 23, 1971
T0: Mr. Eugene B. Sydnor, Jr., Chairman, Education Committee, U.S. Chamber of Commerce
From: Lewis F. Powell, Jr.
[and]
Ralph Nader: A Cover for Corporatism in Scalia’s “Originalism”
http://therealnews.com/t2/index.php?option=com_content&task=view&id=31&Itemid=74&jumival=15702
Ralph Nader says Scalia interpreted the constitution hypocritically
as he extended the bill of rights from persons to corporations – February 18, 2016
Real News interview see VIDEO and comments:
http://therealnews.com/t2/index.php?option=com_content&task=view&id=31&Itemid=74&jumival=15702