(
WSWS)
– On Wednesday, five major international banks, including JPMorgan
Chase and Citigroup, America’s largest and third-largest financial
institutions, pleaded guilty to felony charges for helping to manipulate
global foreign exchange markets, paying a wrist-slap fine of about $1
billion apiece.
The financial impact on JPMorgan and the other banks for pleading
guilty to a felony will be effectively zero. As part of the deal, the
Securities and Exchange Commission issued waivers exempting the banks
from the legal repercussions arising from their status as criminal
organizations, giving them continued preferential treatment in issuing
debt, as well as the continued right to operate mutual funds.
Despite the claims by Justice Department officials of a criminal
conspiracy “on a massive scale,” carried out with “breathtaking
flagrancy,” there was no talk of breaking up JPMorgan or any other bank,
let alone bringing criminal charges against any of their executives.
The rigging of global foreign exchange rates is only the latest in
the string of crimes, frauds and criminal conspiracies for which
JPMorgan has been fined by US and international regulators.
* In January 2013, JPMorgan, together with 10 other banks, agreed to
pay a combined $8.5 billion to settle charges that they forged documents
to foreclose homes more quickly.
* In November 2013, the bank agreed to pay $13 billion to settle
charges that it defrauded investors by selling fraudulent
mortgage-backed securities in the run-up to the housing bubble collapse
in 2007 and 2008.
* That same month, JPMorgan paid $4.5 billion to settle charges that
it defrauded pension funds and other institutional investors to whom it
sold mortgage bonds.
* In December 2013, JPMorgan and eight other banks were fined $2.3
billion for manipulating the London Interbank Offered Rate (Libor), the
global benchmark interest rate on which the values of trillions of
dollars in securities are based.
* In January 2014, JPMorgan paid $2 billion in fines and penalties to
settle charges that it profited from and helped operate Bernard L.
Madoff’s Ponzi scheme.
As a result of the crimes perpetrated by JPMorgan and other banks
over the past decade, millions of people have had their homes
foreclosed, and millions more have lost their jobs, while countless
university endowments, pension plans, and municipalities have been
swindled out of billions of dollars.
Based on this partial list of only the latest and largest crimes
carried out by JPMorgan, it is no exaggeration to conclude that
America’s largest bank is a criminal organization. Why then is it
impossible to prosecute, much less jail, JPMorgan CEO Jamie Dimon, the
mastermind of all of these crimes and conspiracies?
The answer to this question lies in the vast retrogression in social
relations that has taken place in America amid the enormous growth of
social inequality. Behind the increasingly threadbare outwards trappings
of democracy, America has become an aristocratic society, with
entrenched legal and social privileges for the ruling elite.
Before the French Revolution of 1789, European society was divided
into feudal estates, such as the nobility, the church prelates, and the
commoners. The estate into which someone was born was not only an
economic category, but affected all aspects of life, from the laws that
applied to him, to the types of taxes he paid, even to the kind of
clothes he was legally allowed to wear.
The foundations of American democracy, laid in the aftermath of the
American Revolution, were set up in opposition to the rigid social
hierarchy that dominated contemporary Europe. The American Constitution
prohibits the granting and holding of titles of nobility, while the 14th
Amendment explicitly guarantees “the equal protection of the laws” to
all people.
But could anyone argue that this is the case now? According to the
American Bar Association, there are more than three hundred people
serving sentences of life without parole for shoplifting in the state of
California alone, while countless thousands of men throughout the
United States are imprisoned for being too poor to pay child support.
Meanwhile the financial oligarchy and the state officials who defend
their interests are effectively immune from prosecution. This tiny elite
constitutes not merely a separate economic class, but effectively a
separate estate, judged under what are, in effect, a different set of
laws. A worker can be thrown in jail for failing to show up for a court
date, while bankers who steal billions of dollars get off scot-free.
The American financial aristocracy is an inherently criminal class.
Its wealth is based not on production, but on plunder, speculation and
the upward redistribution of wealth through the impoverishment of the
great majority of the population.
This financial oligarchy controls all the levers of power in
contemporary society. The media, courts, politicians and so-called
financial regulators are all under the thumb of the Wall Street
mafiosos. Far from seeking to restrain Wall Street’s criminality, the
government functions to facilitate and cover up for its crimes.
In exchange, politicians are provided with millions of dollars in
campaign contributions and “speaking fees,” while top financial
regulators are invariably assured high-paying positions on Wall Street
after their stints with the government.
Ben Bernanke, the former Federal Reserve chairman who funneled
trillions of dollars to Wall Street during the 2008 bank bailout,
announced this year that he has been hired by two major Wall Street
firms, the hedge fund Citadel and the bond trading firm Pimco, each of
whom will presumably pay him a seven-figure salary. Bernanke followed in
the footsteps of his colleague Timothy Geithner, who became the head of
hedge fund Warburg Pincus in November 2013, following his stint as
Treasury Secretary.
There is no way to break the power of the criminal cabal that
dominates political life in the United States within the framework of
the present social order. Holding the Wall Street criminals to account
requires a radical reorganization of society. Only then can the
criminals who head the major US financial institutions be arrested,
tried and convicted of the crimes that they have orchestrated against
the populations of the United States and the whole world. Their
ill-gotten gains must be seized, and the major Wall Street banks must be
put under democratic control by the international working class.
This requires the building of a mass movement of the working class,
whose aim must be the overthrow of the capitalist system and the
socialist reorganization of economic life in the interest of the great
majority of the world’s population.
This piece was reprinted by
RINF Alternative News with permission or license.
