by Deb Cupples | Five days ago, the U.S. Securities and Exchange Commission (SEC) charged Goldman Sachs with fraud. The first paragraph of the news release:
"The SEC alleges that Goldman Sachs structured and marketed a synthetic collateralized debt obligation (CDO) that hinged on the performance of subprime residential mortgage-backed securities (RMBS). Goldman Sachs failed to disclose to investors vital information about the CDO, in particular the role that a major hedge fund played in the portfolio selection process and the fact that the hedge fund had taken a short position against the CDO."
Other materials at the SEC's website go into a lot more detail. Despite the fact that there are many concrete details that are at least worth a thorough review, a group of Republican politicians -- led by Rep. Darrell Issa -- are essentially trying to bully the SEC into backing off.
It's no surprise: when I used to watch House Oversight Committee hearings back in 2007-08, Mr. Issa habitually knee-jerk defended corporate heads and Bush-Administration bureaucrats. That's just how Mr. Issa tends to roll.
Fact is, our nation believes that people (and corporations) are innocent until proven guilty. I support that notion. What I don't support is the notion that regulators should be dissuaded from thoroughly investigating certain people or entities simply because they have deep pockets. The law is supposed to be applied equally to everyone in this country, regardless of their wealth (or lack thereof). Apparently, Mr. Issa and some of his colleagues disagree.
Interestingly enough, the blog Beltway Confidential reported:
"Campaign contributions from Goldman Sachs employees to President Obama are nearly seven times as much as President Bush received from Enron workers, according to numbers on OpenSecrets.org.
"President Bush's connections to Enron were well-hyped during the
company's accounting debacle that rippled through the economy. Time
magazine even had an article called, "Bush's Enron Problem." The Associated Press ran with the headline, "Bush-backing Enron makes big money off crisis." David Callaway wrote that Enron for Bush was worse than Whitewater for Clinton."
If Beltway Confidential's figures are accurate, then good point.
Still, one major point is missing from that blog post: ex-President Bush had some serious ties to Goldman Sachs--ties that ended up costing us taxpayers hundreds of billions of dollars.
You remember the Bush-backed bailout plans of 2008? The bailouts that led to a massive funneling of our tax dollars to the very executives who had recklessly driven our nation's financial system (and economy) into a ditch?
Who was primarily responsible for designing the no-strings-attached bailout plans?
