I might as well go first, or beat another blogger to the punch. The new mafia in America isn’t what you would think. But wait – there is a bit of looking at what people do and not what they say that matters.

You might recall a theme in the series of movies the “Godfather,” etc. The godfather gets his nefarious business going and gets judges on the payroll for protection. By the end of the series the godfather has a senator or maybe it was a congressman under his thumb doing his bidding. The business went from needing protected from law enforcement to looking for legislation to allow the business to operate.

My, how far the gangsters have come. With all the blog attention and concern by independent economists about the credit crises brewing one can only look and see – its what people do that has to be watched.

So I’ll coin the term. The 21st century will get its opening mark by the inevitable debacle of bank and financial companies who hijacked the law and made the American citizens indentured servants to them. How about banksters?

What anyone can see is what those people have done. With greed and self-interest aforethought they have thrown honesty, decency and moral courage to the winds of change and sold most of the society into an economy based on spend now and pay later.

Here is the quick list.

The banksters have hijacked the Federal government into specifying that only it may regulate interstate financial activities. All of the very worst attacks on people are supported and defended by the Office of the Comptroller of the Currency. No more needing to answer to the states where government is much closer to the citizen. You can buy off 535 members of congress and ride herd on an agency much easier than the legislators across 50 states and likely an equal number of state agencies. A Corleone dream comes true!

With that out of the way the banksters have managed to put hundreds if not thousands of years of contract law into no man’s land. Somehow, its now OK to simply mail a notice and terms of the deal are not, they’re something else! Even worse, now that the banksters can do it other businesses feel that doing it too, is just fine. This is really alarming and one would think that some judge somewhere would have the insight, decency and moral fiber to say, no, the deal is the deal until its over. Then you can try to make another deal.

It gets more criminal like as you look deeper. It’s a numbers game, and paying balances off or not running one at all isn’t the way to a good credit rating – character isn’t part of the secret formulae. It’s a program that is secret and just looks at the numbers to decide who gets how much credit. Its nothing other than legalized gambling with the house controlling the deck, the players, the risks and the outcomes. A no lose scenario for the banksters. Citizen take the whole risk and when one hits the job loss, business contraction, health problem or other matter that prevents keeping up the payments, well, no kneecapping now – instead they bombard people with phone calls, send dreadful letters while packing on stunning fees and charges while raising the interest rates so high a loan shark must get envious. It’s a race to the six month mark when they “charge off” the account and take a tax deduction for the amount originally owned, plus the fees, charges and exorbitant interest, which would likely be twice the amount originally owed. If the bankster is doing well and pays the 35% corporate tax rate the actual cash lost would be more like 15% of the balance when the trouble hit.

But it doesn’t stop there. They “sell” the contract, yup, the one that changes with every notice in the mail, to some “collectors” who paid pennies on the dollar (subtract that from the 15%) who might call and send dreadful mail, call the family and neighbors and generally harass people endlessly until one of two things happen.

A settlement, if you can get it to stick. People need bullet proof, experienced lawyers as the damnable notice in the mail is still out there lurking to trigger it off again. Or bankruptcy for those who it seems might have more sense.

I take exception to certain radio talk show hosts who pontificate that one should always try to pay out your way. I only can agree up to a point, because there is a point beyond which any reasonable person must examine their own personal welfare and those whom the love or are responsible for and try for a clean slate with bankruptcy.

But the banksters have managed to co-op bankruptcy too! It’s not what you think anymore. People have to go to class that I have heard is strongly designed to foment guilt and shame while disguised as training in budgeting. I have yet to meet anyone who got anything worthwhile from such classes unless a genuine sense of anger and resentment is a positive result. The popular chapter thirteen variant is a hollow of its former value and judges are not able to fashion a way for people to work their way back with honor. After all if they did, that big deduction for banksters would go up in smoke! Imagine losing all those deductions on all those faked up fees, charges and stupendous interest rates!

But the chickens are coming home to roost. The banksters criminal minds have been busily figuring out how to get the money they’ve lent, by the numbers if you’ll recall, back in to lend again. So they’ve invented some new securities (collateralized debt obligations for one) to sell to the supposedly sophisticated investor crowd. Reports have it that they have some clever off the books investment vehicles (a la Enron) where they have the risk off the books but the liability can come back to haunt them.

Lately the idea to sell people with little financial know-how and experience loan products for their homes, which with some products didn’t have enough of a payment to cover the running interest or might have lent 125% of the collateral, is crashing in.

The hot topic on Wall Street and the US Treasury is a “super-fund” to bail out the banksters. The holders of these rapidly becoming worthless “securities” are pension funds, hedge funds, insurance companies, big banks themselves and investment firms. Is there any likelihood the “super-fund” paid for by the taxpayers won’t come to pass?

Meanwhile, on October 31st the Federal Reserve board will meet to consider its move in the economy. After just a few weeks from dropping rates to bail out the banksters once before there is no hope the Fed will move to protect the citizens or act to preserve the purchasing power of the dollar.

Not convinced yet? How about this, the banksters get a fee and a percentage of every dollar spent that’s paid by a debit/credit card. They aggressively sign up kids, well, very young adults, and harness them up young. My, I’m starting to admire people who can pay with cash or a check!

What has any of this to do with energy and fuel? Lots, as any improvement in the short term depends on a big improvement in the value of the dollar. With the banksters busily trying to get out of being responsible for their losses and the damage to the economy the prospects for alternative energy and fuel getting investments or just attention is greatly diminished.

My poor prescription is simply to require the banksters to act like they should expect any citizen to do. Take the losses fair and square and if it won’t work out, go bankrupt. A quick effective solution is far better than a long drawn out process of sucking off the taxpayers’ incomes.

But there is little hope. The presidential candidates barely touch on the “subprime” mortgage issue (which isn’t so “subprime” as you’ve been lead to think). The banksters really do own, and I mean own the members of congress’ hearts and minds. We the people are simply not awake and we’ll only pay attention when it’s a crises in progress and by then the banksters will be long gone and the new guys positioned to be some kind of innocents.

One caveat, most, if not by far the most banks, their leaders, managers and employees are fine, decent, upstanding people. You can easily find them in your community, locally owned, where the motto for country, community and citizens still has meaning. If you want to know where to look for banksters a start would be see who is registered to do business in South Dakota, the state that leads the nation in banks that seek to exploit the concepts behind the label – ‘“Banksters” the Mafia of the 21st century.’ Remember you saw it here first!


2 Comments so far

  1. www.topcreditcardsadvice.info » The New Mafia – The America Banksters on October 30, 2007 11:36 PM

    […] Brian Westenhaus placed an observative post today on The New Mafia â

  2. M. Simon on November 7, 2007 9:14 PM


    Its in the Constitution. Congress can regulate interstate commerce.

    There is no plot.

    Just self interest.

Name (required)

Email (required)


Speak your mind