Gangsters - flickr

We have heard a lot over the last four years on how those responsible for the economic/financial crisis of 2008-2009 have gotten away scot-free.  That the policies of Bush have been not only replicated by Obama, but enhanced and refined.

How the same people in charge of the economy under Bush were kept on and that nothing has been done to prevent a repeat of these events.  The right claiming too much regulation and calling the administration fascist or socialist or what not and the left accusing it of similar political evil.  All of whom are in my opinion missing the boat.

The events of the last couple of decades suggest another explanation to what is going on.   Some say since the Reagan administration and some say even Nixon.

Like a person with an incurable decease, when an empire begins to fall apart, it becomes desperate and is willing to try anything to forestall the inevitable.     Rules and morals and ethics that were once sacrosanct,  begin to be discarded and like Matt Taibbi and Ives Smith say, it begins to look and behave like an organized crime family.

BILL MOYERS: You’re describing a corrupt financial and political system. And both of you in recent writings, your current article in “Rolling Stone,” which is devastating on the scam that the “Wall Street learned from the Mafia,” and a recent column you wrote about the mafia state, you’re both using that metaphor to apply to our financial and political system. When I read your pieces, you’re not playing with words there. You mean it.

YVES SMITH: Yeah.

BILL MOYERS: Why do you mean it?

YVES SMITH: Well, the mafia, when it gets to be big enough, first thing it has services that people feel they need if they’re in a difficult situation. So, for example, loan sharking. If you really need money, they do have the money. And people enter into these loan shark deals even though they know it’s going to be very difficult to pay 20 percent or more interest and they’ll have their legs broken if they don’t pay back.

And the banks actually behave very much in that manner when they find people who really need money. So you see this with credit cards, you know, that, or, and with mortgages. That if you hit– it’s not this if you hit any tripwire, that, you know, become in arrears, the banks basically act in this very extortionate manner and don’t cut any breaks.

NOTE: Diary edited to comply with fair use guidelines. -MyFDL Editor

Those with the most to lose begin stop playing by the old rules and begin to make up new ones to fit their current situation as Dmitry Orlov suggests in his Reinventing Collapse.  What he did not expect, I think is that the government itself would fail to follow it’s own rules and would – along with the corporate and financial sector – evolve into what is in a sense a criminal organization. Using national security as the primary pretext to ignoring or completely eliminating any law that proved to be in the way. Or the way this country “removes” bosses of other countries that prove to be “bad for business”.

It wasn’t long after the bank and corporate bail outs that article upon article began to appear in The Washington Post, The New York Times and even That Wall Street Journal stating or questioning whether capitalism was dead. Some very harshly indeed.

Now nearly all of those voices are resolutely silent on the subject and those that still speak out tip toe around it. Even as more and more evidence surfaces of the complicity of government in the criminal behavior of the financial and business sector.

After the fall of The Soviet Union, Russia and a number of its former states plunged into almost total lawlessness where anyone who could,  got as much as they could and then left the people to fend for themselves. (A situation Putin has at least tried to correct, to his credit) We can see that happening here.

With less and less being done on the federal, state and local level to help those who are not part of the upper echelons of power.  And with the treatment of those who challenge these powers – such as OWS – feeling the wrath of the “Dons” for daring to question them.  The police behaving more like gangsters and protectors of the mob than anything else.

And you wind up with a multi faced economy. One official. One unofficial. Such as the underground economy here, which incidentally is valued in excess of 2 trillion dollars.  I knew a fellow who up until recently lived in Moscow and he would tell my friends and I about this – unofficial economy.

The real tragedy and danger is that the government sees nothing wrong, the right still thinks that everyone will play by the rules – even though they plainly are not, and the left still thinks it can be saved or resurrected somehow.  All of whom refuse to accept that the country is far beyond this.

How this will all play out in the end is anybodies guess. It surely cannot continue as it is though.  But expect it to get much worse before it gets better.