Brooksley E. Born
The Crooks Who Screwed America
Joan of Arc was a heroine of France for her role during the Lancastrian phase of the Hundred Years War. She claimed to have received visions of the archangel Michael, Saint Margaret, and Saint Catherine of Alexandria instructing her to support Charles VII and recover France from English domination. She gained prominence after being sent to the siege of Orleans and it being lifted after only nine days. Several subsequent victories led to Charles’ consecration at Rheims and paved the way for French victory against the English. She was captured by traitorous French nobles allied with the English, tried, convicted and burned at the stake by the pro-English bishop Cauchon on 30 May 1431. She was betrayed by her own countrymen.
Things don’t change much almost six hundred years later. Brooksley E. Born is an American attorney who, from August 26, 1996 to June 1, 1999 was chairperson of the Commodity Futures Trading Commission (CFTC) , the federal agency which oversees the futures and commodity options markets. During her tenure on the CFTC, Born lobbied Congress and the President (Clinton) to give the CFTC oversight of off-exchange markets for derivatives in addition to its role with respect to exchange –traded derivatives. Born was particularly concerned about swaps, financial instruments traded between over the counter between banks, insurance companies or other funds or companies, and thus have no transparency except to the two counterparties and the counterparties’ regulators, if any. Her warnings were ignored or resisted by other “regulators” such as Alan Greenspan, Federal Reserve Chairman, Treasury Secretaries Lawrence Summers and Robert Rubin (who also denied funds for the “Atlanta Plan” air defense system for Washington, D.C. and New York City that would have saved thousands of lives on 9/11). Born resigned as chairperson on June 1, 1999. Shortly after, Congress passed legislation prohibiting her agency from regulating derivatives – betrayed by her own countrymen. Worse! By members of her own Party! (She is a Democrat).
Well, we all know what happened. Derivatives should never have been legalized by Congress in the first place because even the mathematicians who devised the model could not explain it to the Wall Street Club. On September 15, 2008 the bankruptcy of Lehman Brothers forced a broad recognition of a financial crisis in both the U.S. and world capital markets. An October 2009 Frontline documentary titled “The Warning” described Born’s thwarted efforts to regulate and bring transparency to the derivatives market, and the continuing [Congressional] opposition there to. The program concluded with Born sounding another warning: “I think we will have continuing danger from these markets and that we will have repeats of the financial crisis – may differ in details but there will be significant financial downturns and disasters attributed to this regulatory gap, over and over, until we learn from experience.”
Well, here we are in the midst of a political / media induced hysteria over a less than average flu season that suddenly ruined an amazingly robust economy. As Born said, “the details may differ” but here we are with the government putting people and businesses out of work and locking them in their own homes. With Congress buying the silence of the population with paltry “economic recovery checks” while siphoning off most of a double budget busting 2 trillion dollar bailout going to Wall Street firms.
U.S. Representative Maurice Hinchey (D-NY) said it best when he asked “How many more failures do you think we’d have to have before some regulations in this area might be appropriate?” Alan Greenspan brushed it aside and said everything was fine. After the collapse (and after publicly humiliating Born) Greenspan said off-handedly “I guess my 33 years of experience turned out to be wrong.” More like your Ivy League loyalties blinded you to a truth a blind man could see.
So, just as Joan of Arc saw visions of her role in the freeing of France, so Brooksley Born saw her role as protecting the American people from a national financial collapse. Just as Joan wore armor going into battle so Brooksley had to have a thick skin to put up with the insulting, demeaning catcalls from the “good-ol’-boys’ club”. Although Joan was actually unjustly burned at the stake, Brooksley, was figuratively burned at the stake – certainly dragged over some very hot coals- by the aforementioned morally bankrupt, misogynistic “bishops” of finance.
Although Joan was not canonized until after her death, Brooksley received her recognition in 2009. Along with Sheila Bair of the FDIC, she was awarded the Profiles in Courage Award in recognition of the “political courage she demonstrated in sounding early warnings about conditions that contributed [caused!] to the current global financial crisis.” According to Caroline Kennedy, “Brooksley Born recognized that the financial security of all Americans was being put at risk by the greed, negligence and opposition of powerful and well connected interests… The catastrophic financial events of recent months have proved them (Born and Sheila Bair) right.
The irony is that Brooksley Born was on the National Commission on the Causes of the Financial and Economic Crisis in the United States published in 2011. She and other commission members beseeched the American public to read their results and use the power of the natural right to govern themselves to ensure effective measures were taken to prevent another collapse. It is available on Amazon.com. It is the most unread book in American print. So is David Stockman’s The Great Deformation: The Corruption of American Capitalism in America, 2013 who says the same things: 1. Nothing has been done to fix the corruption and greed that caused the 2008 collapse, and 2. There will be more numerous and increasingly more severe financial collapses in the future.
David, less subtle but certainly more accurately, describes the incestuous relationship between Wall Street and Congress as “A whore house in a gambling casino.”
This is why presidential candidate Mitt Romney was told by leading financiers the national budget / debt was based on nothing and their mantra was to “Lie! Lie! Lie! Delay! Delay! Delay!” The corporate cannibals have been devouring America’s capital for several decades. I think they’ve hit bone.
“AP: Monday, 15 December 2014, Wall Street won when the House of Representatives on Thursday passed a broad spending bill that contained a provision that rolls back a rule affecting derivatives, the financial product that helped cause the financial crisis of 2008. The Senate is expected to pass the budget legislation containing the repeal this weekend. A repeal would show that, six years after the financial crisis, large banks have found a way to kill off regulations that were part of Dodd-Frank Act, the sweeping legislation that Congress passed in 2010 to overhaul the financial system.”
As U.S. Representative Maurice Hinchey (D-NY) said “How many more failures do you think we have to have?”
Mickey Edwards in his book The Parties vs. The People was absolutely right – the system is rigged…by both Parties.
