Last Thursday, the Obama administration announced its latest windfall for Wall Street—a settlement of charges of rampant law-breaking committed by major banks in their rush to foreclose on families and seize their homes.
The agreement, largely dictated by the perpetrators, quashes investigations by state governments that threatened to expose a cesspool of corruption and crime. It frees the banks from future prosecution or financial liability for forgery, lying to the courts and illegally evicting homeowners.
In return, the firms—Bank of America, JPMorgan Chase, Citigroup, Wells Fargo and Ally Financial—are required collectively to pay a relative pittance in cash ($5 billion) to the states and the federal government and allocate $20 billion more, over three years, to ease the terms for a small fraction of the 11 million homeowners who owe more on their loans than their homes are worth.
Not a single family whose home was seized (4 million since 2007) will get a new house. Instead, an estimated 750,000 foreclosed homeowners will receive a check for $1,500 to $2,000, if they can show that they were improperly evicted. This derisory sum—assuming it is ever paid out—provides a measure of the contempt of the banks and the government for working people.
In what has become his trademark, Obama presented this amnesty for lawlessness and predation by the financial aristocracy as a boon to the people. He called the deal a “landmark settlement” that will “speed relief to the hardest-hit homeowners.”
“Today’s settlement,” he declared, “is all about … standing up for the American people, holding those who broke the law accountable…”
As always, Obama proceeds from the assumption that the American people are infinitely gullible and suffer from collective amnesia. Since coming to office, Obama has done nothing to halt foreclosures or provide relief for distressed homeowners.
When the scandal over “robo-signing” and forged foreclosure documents erupted in the fall of 2010, the 50 state attorneys general launched a coordinated investigation. Some called for a halt in foreclosures to prevent families from being illegally thrown out of their homes.
The Obama administration vociferously opposed this demand and privately urged the banks to speed up the foreclosure process in order to clear out the backlog of non-performing mortgages that was depressing the housing market. With financial stocks plunging and fears mounting that the banks would be unable to withstand untold billions in damages from private and state lawsuits, the White House intervened to preempt any serious investigation and block a public airing of the crimes.
It spent 16 months in secret talks with the banks and attorneys general, devoting most of its efforts to bullying recalcitrant states to drop their own lawsuits and join a federal-state settlement favorable to Wall Street. The result was the deal announced Thursday.
via www.wsws.org
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