Tuesday, March 18, 2008

Spitzer, Politics, and the Housing Crisis

If you're like me, you probably think that war mongering, corporate coddling, corrupt and scheming politicians deserve more attention than politicians using their own money to buy a prostitute. And if you are like me, you probably noticed that we aren't in the majority in our value judgements. No, in most U.S. media outlets the Spitzer story "has legs," and so all the lurid details must be doggedly pursued. The New York Times found it compatible with their ever waning journalistic integrity to include a link to "Kristen's" Myspace page, for the readers interested in all the social networking news fit to print. What's missing in this coverage is perspective, as well as some context that might make this story interesting and important.

First, perspective: The investigation into Mr. Spitzer was expensive and far reaching. Thus, the investigation in all likelihood was politically motivated.
Yes, that's right, the Bush Justice Department, not adverse to being political (joke), set its sights on the Democratic "sheriff" of Wall Street, and they got him good. The fact is that you do not go from a dead-end money transfer inquiry to a full blown investigation with plenty of personnel and wiretaps to a media fiasco, without a larger political motivation. As wsws.org pointed out in their great article on the topic - a must read - if this were as big a case as the federal government was claiming, where are Clients 1 through 8 and 10 and above - Spitzer, remember, was "Client 9"? Where are the prostitution ringleaders? Where is the confiscated cash and bank accounts? The dearth of evidence points to a hit-job, where the Justice Department focused all their recourses on catching the Governor, while letting the prostitution-ring slip by.
This would not be the first time that the Bush administration has targeted politicians not of their ilk for termination. A recent 60 Minutes piece on the shady conviction of former Alabama governor Don Siegelman, purportedly directed by Karl Rove via the White House, shows just how deep this administration is willing to get when they find it in their interest to get involved.
So what interest does the White House have in bringing down Elliot Spitzer. Now we are getting to context. Beside the fact that Mr. Spitzer was a popular Democrat who won the New York Governorship with over 60% of the vote and seemed to have high political aspiration, he was also very disliked by the money conjurers of Wall Street, a group very closely aligned with the Bush Administration.
Mr. Spitzer made his fair share of uber-wealthy enemies while working his way up to the Governors mansion in Albany. The scene of Wall Street traders cheering at the news of Spitzer's indictment clearly shows their antipathy towards him. As the journalist Greg Palast points out in a recent post on his blog, the bust of Spitzer coincides with another bust going on in the financial system, that of the housing market. Spitzer was very involved in investigating the shady sub-prime aspect of the housing bubble, filing suit not only against Countrywide Financial Corporation, but also its parent company, Bank of America, as well as many other financial firms, for illegal lending practices. Here, from his Washington Post op-ed, is what Mr. Spitzer had to say about the sub-prime mortgage debacle and the Bush administrations role:
Not only did the Bush administration do nothing to protect consumers, it embarked on an aggressive and unprecedented campaign to prevent states from protecting their residents from the very problems to which the federal government was turning a blind eye..... When history tells the story of the subprime lending crisis and recounts its devastating effects on the lives of so many innocent homeowners the Bush administration will not be judged favorably.
Harsh words... And so Spitzer is now out of office and out of the public arena for a very long time. No more prosecutor sticking his nose into Wall Street's sordid business. The saddest aspect of this whole story is the way the media has handled it. Instead of giving people the perspective and context that was needed, and should be expected from the venerable "liberal" 4th estate, we got a bunch of moral claptrap, without substance and without relevance.

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