Predator Nation: Corporate Criminals, Political Corruption, and the Hijacking of America

Краткое содержание «Predator Nation»

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   When the Thieves Walked Free

   

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   Picture the aftermath of 2008: millions of Americans losing their homes, their retirement savings evaporating, unemployment lines stretching around blocks. Now picture this: not a single major banking executive went to prison. Not one. Despite fraud so blatant that internal emails literally described their mortgage products as "toxic waste" and "complete garbage," the architects of America's worst financial crisis since the Great Depression walked away with their fortunes intact. How did we arrive at a place where destroying the economy pays better than building it? The answer reveals something far more disturbing than a financial crisis-it exposes the transformation of America into an oligarchy where the rules simply don't apply to those at the top. Think of a rainforest canopy-that dense layer of treetops where sunlight pools, creating an entirely separate ecosystem from the dark forest floor below. America's wealthiest 1% now inhabit exactly such a world. By 2007, they captured 23% of all taxable income, the same share as in 1928, right before the Great Depression. They own a third of America's total wealth and over 40% of its financial assets-more than double what the entire bottom 80% possesses combined. This isn't just inequality; it's economic apartheid. While executives pull down eight-figure bonuses and maintain homes on three continents, median wages have actually declined. The 2001-2007 "boom" years? Average American incomes fell even as the wealthy prospered spectacularly.

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   The Deregulation Disaster and Democratic Betrayal

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   For forty years after the Great Depression, banking was boring-and stable. Glass-Steagall separated deposits from securities trading. Strict regulations kept banker pay at just double the average American's salary, creating long time horizons and healthy risk aversion. Then came the 1980s. Reagan appointed industry executives to run the agencies meant to police them. When inflation destroyed S&Ls' business model, Congress could have shut them down for $10 billion. Instead, the industry secured deregulation. Lobbyist Richard Pratt became their regulator and gutted self-dealing restrictions. Charles Keating bought five senators for $300,000. Vernon Savings grew twenty-twofold with 96% of loans delinquent. The cleanup cost taxpayers $100 billion. The 1990s brought Internet prosperity, but the Clinton administration created a regulatory wasteland. Under Rubin, Summers, and Greenspan, finance became concentrated and systemically dangerous. They drove deregulation, allowed consolidation into oligopolies, and permitted unregulated derivatives. Compensation rewarded short-term gains with zero penalties for losses. The revolving door perfected legalized bribery: Robert Rubin went from Goldman Sachs to Treasury Secretary to Citigroup, collecting $126 million while the bank collapsed.

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   Manufacturing a Catastrophe Through Predatory Lending

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   When the dot-com bubble burst in 2000, Greenspan slashed interest rates to 1%-a fifty-year low-deliberately creating the housing bubble. Home prices doubled between 2000 and 2006, the largest increase in history. Fewer than 10% of subprime loans financed first-home purchases; most were refinances, second homes, or pure speculation. The bubble let Americans borrow against rising home equity, masking falling wages and disappearing manufacturing jobs. Predatory lenders flourished in the unregulated shadow banking sector. New Century Financial exploded from $3.1 billion in originations (2000) to $51.6 billion (2006). Washington Mutual pushed Option-ARMs and stated-income loans despite internal data showing delinquencies up 140% and foreclosures up 70%. Two high-production centers showed fraud rates of 58% and 100%. New Century executives wrote in 2004 that stated-income loans "do not perform as well as Full Doc loans" and acknowledged "a borrower's true income is not known." Countrywide's Angelo Mozilo made false public statements while privately selling over $100 million of his own shares, walking away with $450 million. Crime paid spectacularly well.

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   Wall Street's Fraud Factory and the Ratings Agency Conspiracy

   Wall Street engineered disaster through securitization, pressuring lenders to supply worse mortgages for profit. Perverse incentives made fraud rational-huge annual bonuses based on short-term performance during a 5-7 year bubble meant participants got rich regardless of eventual collapse. Why worry about 2010 when you're pocketing $20 million in 2006? Charles Schwab's lawsuit exposed systematic fraud. Clayton Holdings reviewed 911,000 mortgages for 23 banks and found 28% failed even the securitizers' own guidelines-yet 39% of these failing loans were securitized anyway, never disclosed to investors. Bear Stearns ignored 65-75% of recommendations to reject bad loans. Goldman Sachs created GSAMP Trust 2006-S-3, a $494 million security containing second mortgages from notorious subprime lenders. Despite borrowers having virtually no equity (99.29% average loan-to-value) and 58% lacking documentation, 93% received investment-grade ratings, with 68% rated AAA. The ratings agencies-Moody's, S&P, and Fitch-operated as an oligopoly, claiming ratings were merely "opinions" protected by the First Amendment while Moody's became the most profitable Fortune 500 company, paid to bless garbage as gold.

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   Betting Against Their Own Clients: Engineering Financial Weapons

   By late 2005, Wall Street created synthetic CDOs-derivatives generating high-risk paper without actual mortgages. These were essentially two-sided wagers where investors unknowingly sold insurance while their "interest payments" were actually premiums on bets against those securities. Goldman Sachs led this shift. Internal documents show they accurately called the bubble's end and began aggressively shorting. By December 2006, they'd identified $807 million in potential losses and built their "big short" position. Simultaneously, they offloaded toxic assets to "non-traditional buyers" while avoiding "sophisticated hedge funds" who understood the game. Their $2 billion Hudson Mezzanine CDO exemplified this duplicity-sales presentations claimed "aligned incentives with investors" while they dumped bad inventory. John Paulson convinced Goldman to custom-design securities specifically for shorting. The ABACUS 2007-AC1 deal was a $2 billion synthetic CDO filled with bonds Paulson selected for failure. Goldman hired ACA Management as the supposedly "independent" portfolio manager but never disclosed Paulson was betting against it. Magnetar refined this further-buying massive short positions while simultaneously purchasing the equity tranche, covering shorting costs until collapse and profiting from disaster while actively creating it.

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   Crime Without Punishment: Justice for Sale

   Since deregulation, finance breaks the law more than any major industry, yet criminal behavior goes unpunished. For twenty-five years, egregious conduct results in civil settlements where institutions admit nothing, pay trivial fines, promise reform-and repeat the same offenses. A 2011 New York Times analysis found 51 cases where major banks settled securities fraud charges after previously violating identical laws. Banks facilitated money laundering for kleptocrats and drug cartels. Wachovia transferred $378 billion between Mexican currency exchanges and the U.S. without reporting suspicious transactions-funds traced to cartels purchasing jets for cocaine smuggling. Credit Suisse, Barclays, and Lloyds laundered billions for Iran and sanctioned nations, stripping incriminating data from wire transfers. Bernard Madoff operated history's largest Ponzi scheme for thirty years, causing $19.5 billion in losses. JPMorgan Chase, his banker for over twenty years, saw obvious account irregularities yet took no action-Madoff had generated half a billion in fees. Individual investors face prosecution while bank executives walk free. This isn't justice-it's a protection racket for the wealthy. America's elite no longer needs America to succeed. They use private schools and jets, so public services can crumble. They manufacture in Asia and sell globally, making American workers irrelevant.

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   Reclaiming Democracy: The Fight for America's Soul

   In corrupt systems, the worst rise to power, productive people turn destructive because corruption pays better, and everyone else suffers. America has reached this inflection point where predatory behavior is more profitable than honest work. For just $20 billion annually - 1% of corporate profits - America's most predatory industries have purchased favorable political treatment. The financial sector pioneered this strategy, using lobbying primarily for predation rather than defense. The two parties compete for funding while colluding to hide this fact, creating fierce partisan conflict on social issues while maintaining identical positions on economic matters critical to the oligarchy. Yet hope exists. Occupy Wall Street, Warren Buffett's critique of billionaire tax breaks, and grassroots reform efforts demonstrate growing awareness. America needs fundamental reforms: breaking up large banks, strengthening regulation and enforcement, controlling money in politics, reforming taxes to prevent oligarchy, and rebuilding infrastructure and education. With fragmented politics and depleted crisis-fighting tools, another financial collapse could trigger genuine instability. The choice is stark: accept a system rewarding predatory behavior, or reclaim the promise of a nation built on idealism and trust. The thieves walked free once. Will we let them do it again?

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