Where there is money, there will be criminals stealing the money — the more money, the more criminals — and banks control more money than anyone.
Number 9 in the “Ten Steps to Prosperity” is this one: Federal ownership of all banks.
A few excerpts from that article:
Banks are involved in most U.S. dollar creation. Even the dollars created at the direction of the federal government originate with banks.
The two primary dollar-creation methods in the U.S. are bank lending and federal spending:
Each time a banklends, it simply increases the numbers in the borrower’s checking account. That instantly adds dollars to the money supply.
When the federal government spends, it sends instructions to a creditor’s bank, instructing the bank to increase the numbers in the creditor’s checking account. When the bank does as instructed, dollars are added to the money supply.
This participation in the vast majority of all dollar creation gives banks enormous financial power, and as we all know — and the “Great Recession of 2008” reminds us — power corrupts banks, especially when multiplied by a profit motive and government complicity.
Although the federal government also is powerful and corrupted, it does not suffer from a profit motive, and that makes all the difference. The government neither needs nor uses profits, and unlike bank employees, federal government employees do not receive remunerations based on federal agency profits.
In Summary: No public purpose is served when the banking industry is in private hands.
For many of the same reasons that the U.S. Treasury is owned by the federal government, not by the private sector, the federal government should nationalize and run all banks.
The article describing the need for Step 9 tells why banks become corrupt, though most Americans believe that the bank they use is essentially honest and accurate.
That belief is naive.
The FinCEN Files investigation is based on thousands of “suspicious activity reports” and other US government documents that BuzzFeed News has shared with the International Consortium of Investigative Journalists and more than 100 news organizations around the world.
It offers an unprecedented view of global financial corruption, the banks enabling it, and the government agencies that fail to stop it.
Prior to this reporting, very few SARs had ever been revealed. The FinCEN Files encompass more than 2,100. Here is what the investigation has uncovered (I urge you to click the next link to read the full article):
8 Things You Need To Know About The Dark Side Of The World’s Biggest Banks, As Revealed In The FinCEN Files
Big banks around the world approve trillions of dollars of suspicious transactions despite their own staff’s warnings that they might be related to crime.
Terror networks, drug cartels, organized crime rings, and rapacious kleptocrats have all benefited, using the US financial system to wash clean their illicit profits.
The banks — and their shareholders — make a profit off all this activity, while the transfers help these notorious figures sow misery around the world.
The US government is informed of these transactions through “suspicious activity reports” (SARs) that banks file.
Those reports are designed to aid the fight against money laundering, but experts say the system contains a crucial loophole: Banks are required to file alerts to the Treasury Department’s Financial Crimes Enforcement Network, or FinCEN — but not to halt the suspicious activity or to stop serving shadowy clients.
Sources told BuzzFeed News that the vast majority of these reports, also known as SARs, are never even read, much less investigated.
One of the biggest money laundering schemes in memory became an international scandal for Deutsche Bank; top executives there had been warned the bank was at risk of being exploited by criminals.
(You may remember that Deutche Bank also inexplicably made over $2 billion in loans to Donald Trump when no other banks would touch him.)
There are plenty of laws on the books, that should prohibit banks from ignoring SARs. But the lesson is: The profit motive is the strongest power in the universe — stronger than all the armies and all the police in all the nations on earth. Money leads to crime. Big money leads to unstoppable big crime.
Consider this article:
HSBC, Europe’s largest bank, had just been caught allowing a network of drug kingpins, including the notorious Joaquín “El Chapo” Guzmán, to launder more than $880 million through its accounts. And it had brazenly done business in off-limits countries such as Sudan and Myanmar.
HSBC executives pleaded for another chance, and the US Department of Justice granted it: Admit your guilt, pay $1.9 billion in fines, and submit to an independent monitor.
But, even under the most intensive scrutiny, the bank continued to facilitate and profit from transactions it suspected were dirty.
At the end of the monitor’s five-year tenure, he said HSBC had made progress, but the bank itself told shareholders that he found it was still not “adequately managing financial crime risk.”
And, consider this article:
Elizabeth Warren And Bernie Sanders Want Big Banking Reforms Following The FinCEN Files Investigations
Warren called for the creation of a new unit in the US Treasury Department, separate from FinCEN, “to investigate these types of financial crimes.”
Sen. Elizabeth Warren called on Monday for reforming the government practice of offering banks deferred prosecution agreements instead of real punishments when they are caught abetting money laundering, one of the problems highlighted in the series.
She also called for the passage of her so-called Ending Too Big to Jail Act, legislation she introduced in 2018 that she said would hold Wall Street executives criminally accountable when the banks they lead break the law. This, she said, would stop the practice of allowing “bankers to walk away with drop in the bucket settlements and slaps on the wrist.”
Yes, bankers should be jailed for criminal activities, but Warren’s and Sanders’s program will do little-to-nothing for two reasons:
- If the threat of jail could stop crime, there would be no crime. Given sufficient motivation (big profits), there will be big crime. Laws are insufficient.
Laws have not stopped the drug trade. Laws did not stop alcohol during prohibition. Laws did not stop gambling. Money is stronger than the threat of punishment.
- The only way to reduce crime –not “stop;” crime can’t be stopped– is to reduce the motivation.
The prime motivator for bank crime is bank profits.
Rather than passing more laws that will be broken, the federal government should merely remove the profit motive from banking by eliminating private banking.
All banks should be owned by the federal government, which has no need for profits.
Rodger Malcolm Mitchell
Monetary Sovereignty Twitter: @rodgermitchell Search #monetarysovereignty Facebook: Rodger Malcolm Mitchell …………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………..
THE SOLE PURPOSE OF GOVERNMENT IS TO IMPROVE AND PROTECT THE LIVES OF THE PEOPLE.
The most important problems in economics involve:
Ten Steps To Prosperity:
- Eliminate FICA
- Federally funded Medicare — parts A, B & D, plus long-term care — for everyone
- Social Security for all or a reverse income tax
- Free education (including post-grad) for everyone
- Salary for attending school
- Eliminate federal taxes on business
- Increase the standard income tax deduction, annually.
- Tax the very rich (the “.1%”) more, with higher progressive tax rates on all forms of income.
- Federal ownership of all banks
- Increase federal spending on the myriad initiatives that benefit America’s 99.9%
The Ten Steps will grow the economy and narrow the income/wealth/power Gap between the rich and the rest.