The OBAMA! Runs the World’s Biggest Protection Racket

Posted on August 31st, 2014 by admin in Political Economy

A recent study on the nature of political  influence in USA has gotten lots of attention, especially from liberals, because this work seems to show that a few business special interests get government to act to enrich these same interests, frequently contra-the desires of the individual. That’s probably true to a degree, but this point is trivial in comparison to the protection racket the government runs against those very same interests. Even the left-leaning Economist magazine has seen fit to publish a cover story on this protection racket:

The Criminalisation of American Business

As the Economist notes in the article,

The amounts are mind-boggling. So far this year, Bank of America, JPMorgan Chase, Citigroup, Goldman Sachs and other banks have coughed up close to $50 billion for supposedly misleading investors in mortgage-backed bonds. BNP Paribas is paying $9 billion over breaches of American sanctions against Sudan and Iran. Credit Suisse, UBS, Barclays and others have settled for billions more, over various accusations. And that is just the financial institutions. Add BP’s $13 billion in settlements since the Deepwater Horizon oil spill, Toyota’s $1.2 billion settlement over alleged faults in some cars, and many more.

This summary neglected to count the Department of   Justice settlement with Bank of America for $17B as protection from criminal lawsuit for acquiring Merrill Lynch at government request during the financial crisis of 2008! See also this description of the shakedown.

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