Drain the swamp
President-elect Donald Trump named Steven Mnuchin, a former partner at Goldman Sachs who has no experience in government whatsoever, to lead the Department of the Treasury.
Here are some Mnuchin highlights from the New York Times story:
Mr. Mnuchin, the son of a Goldman Sachs partner, joined the firm after graduating from Yale University. He worked there for 17 years, rising to oversee trading in government securities and mortgage bonds.
After leaving Goldman in 2002, he founded Dune Capital Management, a hedge fund named after the dunes near his beach house in the Hamptons.
[…]
Mr. Mnuchin was part of a group that bought the failed California mortgage lender IndyMac from the government in 2009. He became chairman of the company, renamed OneWest, which was ultimately sold to CIT, the nation’s largest small-business lender, in 2015 for more than twice the price the group had paid.
During his tenure, OneWest faced allegations that it had foreclosed improperly on some borrowers. Fair-housing groups also filed a complaint with the federal government, alleging that OneWest was not meeting its legal obligation to make loans in minority neighborhoods.
Even in a terrible Trump cabinet, Mnuchin stands out for one particularly infuriating reason: he serves as just another reminder of how and why the Democratic Party lost to an enormously wealthy 70-year old “populist” for whom the presidency is going to be his first real job.
The more meaningful number is how many Wall Street executives have gone to jail for playing a part in the crisis. That number is one. (Kareem Serageldin, a senior trader at Credit Suisse, is serving a 30-month sentence for inflating the value of mortgage bonds in his trading portfolio, allowing them to appear more valuable than they really were.) By way of contrast, following the savings-and-loan crisis of the 1980s, more than 1,000 bankers of all stripes were jailed for their transgressions.
“I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them when we are hit with indications that if you do prosecute, if you do bring a criminal charge, it will have a negative impact on the national economy, perhaps even the world economy,” Holder said, according to The Hill. “And I think that is a function of the fact that some of these institutions have become too large.”
The reason why the Democratic Party didn’t do this is clear. These are the people who fund their campaigns; new Senate Democratic leader Chuck Schumer, from New York, is a prolific fundraiser who is notoriously close with Wall Street, and the systematic dismantling of bank regulations was usually a bipartisan affair. Hell, the current Treasury Secretary spent three years at Citigroup in the mid-2000s leading a division that “bet against the housing market as it prepared to implode.”
And this failure to stand up to Wall Street had consequences. The Obama administration’s refusal to press for prosecution of financial institutions, for the crash and other crimes it has committed, and the Democratic Party’s refusal (with a few exceptions, like Bernie Sanders and Elizabeth Warren) to take aggressive action to prevent something like this from ever happening again, left the cause of the Great Recession up for debate. It also destroyed any shred of working class credibility the Democrats had left.
And eight years afterwards, this happened: working class white voters — unaffected by the Republican Party’s unbridled hatred of people of color that keeps African-Americans and Latinos safely in the Democratic column, and never hearing the (poll-tested) message that Trump’s policy proposals were the same ones that helped ruin their lives in the first place — either stayed home entirely or took the selling out of both major parties to Wall Street and decided immigrants, Muslims, and African-Americans were a useful vessel for their anger.
And when they joined a coalition of wealthier white voters to elect a spoiled rich “populist” for whom the presidency is his first real job, we got a president-elect who only settled on Mnuchin when Jamie Dimon turned him down. And still, the swamp goes undrained.
