Community Theatre Review: Suspension of Disbelief a Must for Congress-Goldman Sachs Co-Production of "Die, You Gravy-Sucking Pig"

I've seen some show trials in Washington in my day, but Congress' current "flaying" of Goldman Sachs really takes the cake. Usually when Congress decides to make an example of someone, it's some unfortunate and unwilling schlub who gets thrown under the bus in order to hide the complicity of Congress itself. This time, we have a slightly different situation on our hands. The whole thing is high theatre, with both Congress and Goldman Sachs playing their roles to the hilt.

Anyone who's been awake for even half a second of the last several decades knows that Goldman Sachs is a key player in the manipulation of our economy.  Though the fullness of the relationship remains purposely shrouded in mystery, Goldman Sachs is one of the most--if not the single most--important stakeholder in "our" Federal Reserve System. What's more, nearly every Treasury Secretary we've ever had since the Federal Reserve was established in 1913 have come from...Goldman Sachs.  If that's not an incestuous little triangle, I don't know what is.

That Goldman Sachs would cheerfully make money off the failure of its own customers--and a whole lot of other taxpayers and investors besides--should be no surprise to anyone. In fact, it's standard operating procedure. Furthermore, we all know that Congress fostered the bad behavior of Goldman Sachs and other financial institutions. So far from genuine is Congress' effort to look shocked by Goldman's behavior that one might wryly label it comic.

Now why, you might be asking yourself, would Goldman Sachs submit to the current "grilling" it's presently getting in Congress when it knows all of the other players, has just as much dirt on them and could spin this whole affair so that they come out smelling almost like a rose?  First, because, as always, Goldman Sachs is in on the theatre. Goldman remains crystal clear that Congress has to look like it's doing something meaningful when, in point of fact, it isn't even vaguely serious about leveling any real punishment. It's one big, extended photo op for a bunch of corrupt grandstanding politicians--many of whom benefited in one respect or another from the creation of the mortgage derivatives crisis. I believe grandstanding is the appropriate word. If anyone were actually serious about cracking down on Goldman, criminal charges would have been leveled by now instead of the civil charges that have been thrown to the public as some kind of meatless bone.

What's more, Goldman Sachs is gambling that if it plays it's role well in the current little melodrama, it will keep public eyes off of an even bigger scandal now beginning to gain traction. See, Goldman is neck deep in yet another derivatives scam, one that hasn't fully unfolded yet but stands to pay off BIG if it can be pushed through. Right along with Al Gore's British-based company Generation Investment Management--which is positively riddled, incidentally, with former Goldman Sachs personnel--the investment bank bought itself a big chunk of a little Chicago outfit known as Carbon Credit Exchange, or CCX. CCX, which for the moment remains a voluntary affair, facilitates exactly what it says: carbon crediexchange. It operates on a global basis and has some very big-name, progressive-driven, U.S. customers: DuPont, Ford, United Technologies, the City of Chicago, and Miami-Dade County. 

Iin short, Goldman has made itself a major player in what they're betting will soon be mandatory carbon trading here in the U.S. Nearly everything is in place. All they need is Cap and Tax legislation to pass--or, barring that, a regulatory end-run around the legislative process...and VOILÀ! Instant trillions and more power over taxpayers. If I were them, I'd be doing a little play-acting right about now myself in hopes of: a) protecting my nefarious investments by distracting the public until it's too late; b) trying to save what remains of my reputation as a reputable bank; and 3) trying to keep lots of employees out of prison somewhere down the road. 

To get a better sense of the CCX scandal, who the players are, and how it will impact you, I've put together this PDF with notes. Be aware that there's more coming. From what I hear, what I'm showing you here is just the tip of a gargantuan iceberg...

Posted: Wednesday - April 28, 2010 at 11:50 AM