Americans were incensed when Congress handed Wall Street a blank check after the 2008 financial crisis. Despite their rampant fraud and their holding the economy hostage, which resulted in thousands of Americans being evicted from their homes, not a single CEO, hedge fund manager, or banker was prosecuted. One of most egregious example of known fraud was perpetrated by the investment banking firm Goldman Sachs. Unbelievably, the only individual found liable for committing fraud at Goldman Sachs, Fabrice Tourre, was recently offered a teaching position at the University of Chicago. Only upon massive public outcry was the University’s offer to Tourre rescinded.
How can it be that such a disconnect exists between the public’s idea of justice and the penalties actually realized by the perpetrators of the financial scandal? It is worth noting that in direct contrast to our own seeming inability or unwillingness to pursue these criminals, the country of Ireland has committed to full pursuit and prosecution of its own like transgressors.
Ireland is currently placing three prominent bankers on trial for the 2008 financial calamity which brought their economy to the brink of collapse. The panic resulted in some of the harshest austerity measures including high unemployment and spending cuts. Those placed on trial include former chairman of the now defunct Anglo Irish Bank Sean FitzPatrick, the former finance director Willie McAteer, and the former chief financial officer Pat Whelan. FitzPatrick, McAteer, and Whelan face 16 charges under Ireland’s The Companies Act, including granting illegal financial assistance to figures for the specific agreement of purchasing shares in the Anglo Irish Bank. Whelan faces seven additional charges of altering loan documentation.
In the United States, an investment banking firm such as Goldman Sachs not only remains unprosecuted, but its employees continue to be incestuously rewarded by their allies in academia and government. Shortly after President Obama was inaugurated for his first term, a Goldman Sachs executive was appointed the first Chief Operation Officer of the Security and Exchange Commission’s (SEC’s) enforcement division. In the same year, then Treasury Secretary Tim Geithner hired former Goldman Sachs lobbyist Mark Patterson to be his Chief of Staff. Prior to that, in 2008, former Goldman Sachs Vice President Neel Kashkari was appointed by then Treasury Secretary Henry Paulson to oversee the $700 billion bailout of Wall Street. It should also be noted that Paulson, before becoming Treasury Secretary, was the CEO of Goldman Sachs.
The revolving door between the federal government and Goldman Sachs has kept them from being indicted by the Department of Justice. However, there are those, including certain journalists and commentators, who believe that investment banks like Goldman Sachs are “too big to jail.” They argue that the investigation and subsequent prosecution could drain taxpayer coffers. Strangely, this regard for the welfare of the taxpayer, employed by the same journalists and elected officials, did not seem to merit similar consideration when the Treasury Department issued a blank check to Wall Street. As reported by The Independent, the fact that some of the investigations into the activities of Whelan, McAteer, and Fitzpatrick could require years to complete has not deterred the Irish from continuing forward with the prosecution of the three bankers that nearly destroyed their own economy.
The stark contrast between the reaction of Ireland and the United States to the 2008 financial crisis affirms a much deeper problem: one of the inequitable application of the rule of law. While America’s financial elite have been given an unlimited supply of “get out of jail free cards,” ordinary Americans are assured by Washington that if they commit any of the same crimes perpetrated by Wall Street, they will be prosecuted to the fullest extent. Washington has made it clear to the American people that financial institutions and their management will be exempt from action if they violate the law, and that the taxpayers will be expected to bear the further insult of having to bail them out.
The nonexistent application of law and the indemnification of financial entities in the United States during the financial crisis of 2008, especially in comparison to the zealous pursuit of justice in Ireland, relegates the American public to the role of slave within a system which privatizes gains and socializes losses. Such a gross violation of public trust and government-approved inequity can lead only to dissention. As George Washington University professor and constitutional scholar Jonathan Turley explains: “A legal system cannot demand the faith and fealty of the government when rules are seen as arbitrary and deceptive. Our leaders have led us not to an economic crisis or an immigration crisis or an environmental crisis or a civil liberties crisis. They have led us to a crisis of faith where citizens no longer believe that laws have any determinant meaning. It is politics, not the law, that appears to drive outcomes- a self-destructive trend for a nation supposedly defined by the rule of law.”
Kevin Patrick Kelly is a university student majoring in History and Political Science. Previously, he was a columnist for The Washington Times Communities. Follow him on Twitter @TheKevinPKelly.
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