The Newest Ruse: Banks Capitalizing on “Toxic Assets” to Book Puffed-Up Profits

http://www.moneymorning.com/2009/06/02/banks-toxic-assets/

Dick Durbin could not conceal the bitter aftertaste. He told a hometown radio interviewer: “Hard to believe in a time when we’re facing a banking crisis that many of the banks created–they are still the most powerful lobby on Capitol Hill. And frankly, they own the place.”
Durbin’s disappointment may have included the former Illinois senator whom he had championed for president. Barack Obama took a walk on reform. Last year as a candidate, Obama declined to support the bankruptcy provision for the financial-bailout legislation, but he promised reform groups he would support it if elected. The White House wouldn’t let reformers include it in the stimulus package or in Obama’s first budget. The White House suggested the issue could proceed as a stand-alone measure (guaranteed to fail). On this important reform, the president stands with the sharks.
The Democratic Party ignores its left-liberal-progressive base with some regularity because it knows it can. Politicians understand they will suffer no consequences afterward. The galaxy of mediating organizations, including organized labor, that surrounds and supports the party may stomp and holler, but they do not attempt any retribution that might alter their relationship with power. Reform organizations will not withdraw their support, either money or rank-and-file voters. Nor will they seek to punish any of the wayward Democrats who regularly vote against them with opposition at the next election. The “white hat” reformers are Washington insiders themselves, with a seat at the table and influence on the substance of the party’s agenda. They do not want to put their status at risk. Politicians know this from long experience.

http://www.thenation.com/doc/20090622/greider/3