robert scheer - Represent Consumers

It’s been a rough couple of months for the Muppets. First Fox News anchor Eric Bolling denounces their new movie as dangerous left-wing propaganda because it portrays a villainous oil company executive.

Then Goldman Sachs executive Greg Smith quits his job and discloses in a scathing hatchet job of the firm’s culture that his fellow bailed-out bankers refer to their clients in a derogatory way as Muppets.

And what do they mean by that?

Hmmm. Maybe they think Muppets are puppets that are manipulated by their handlers. Maybe Goldman Sachs bankers imagine us to be lifeless sacks of cloth and yarn without spirit and voice, but we’re not.

And no self-respecting Muppet would put up with the shenanigans of Goldman Sachs (though I suppose their corporate owners, the Walt Disney Co., might).

The Muppets have always had a strong populist streak – they articulate sharp critiques of the Greed-is-Good Wall Street culture that Goldman appears proud to embody.

Check out the song “Money,” co-written by comedian Stan Freberg and Ruby Raskin. Performed by Dr. Teeth, it ridicules the rampant desire for more, more, more money at the expense of everything and everyone else.

At the end of the song, Dr. Teeth yanks a slot-machine handle on the side of his piano – which pays off.

If you have any doubt about whether the Muppets would side with the 1 percent or the 99 percent, check out their version of a “A Christmas Carol.”

In his farewell exposé—beyond his Muppet revelation— Smith merely confirms what we’ve already known: Goldman Sachs and the other powerful too-big-fail institutions believe they can get away with screwing their clients by protecting themselves with high-level political clout, bought with political contributions and cemented with interlocking relationships between the government and the firms.

As Robert Scheer points out, it was just a day before Smith unloaded on Goldman that a former top aide to Treasury Secretary Timothy Geithner, Jake Siewert, became the managing director and global head of Goldman’s corporate communications. Siewert is just the latest of a long line of public officials to cash in at the big banks.

How perfect that a high-level member of the Obama administration, which has chosen to align itself with the interests of the big banks time and time again, will now be the one to design Goldman’s defense against the bad publicity stemming from Smith’s oped.

Scheer, along with Matt Taibbi—another astute reporter/commentator on the financial collapse and its aftermath—are full of praise for Smith’s stepping out so publicly.

For myself, I wish that Smith had been willing to step up and connect Goldman’s policies to the financial collapse, not to mention the role Goldman has continued to play in rigging our political system to escape the consequences of its devastating greed and fraud.

That may be too much to ask of somebody on his first day out of the protective Goldman bubble. Make no mistake, it’s not just clients the firm has manipulated for its own gain.

Goldman and the other to-big-to-fail banks have turned us all into puppets, holding over our heads the specter of fear, and pulling the strings to secure a hefty back-door bailout for themselves.

As for the Muppets, I’m sure they’ll weather their current troubles with aplomb. Hopefully their creators are busy at work on a scheme for revenge.

I’ve never seen a Muppet either shut up or stand still while someone ties her hands behind her back. It’s the rest of us I’m worried about.

Despite the efforts of our public officials and bankers to ignore it, downplay it, paper it over or make it disappear, the fraud surrounding the mortgages at the heart of the financial collapse is the scandal that won’t go away.

Two big stories breaking over the past week showed what strong legs the scandal has. First, Huffington Post reported on a series of confidential audits that showed five of the country’s largest mortgage companies defrauded taxpayers in their handling of foreclosures on homes purchased with government-backed loans.

Then the New York Times and others trumpeted an investigation of the mortgage securitization process by New York’s new state attorney general, Eric Schneiderman. This investigation won strong praise from two of the toughest watchdogs on the financial beat, Matt Taibbi at Rolling Stone and Robert Scheer at Truthdig, who portrayed Schneiderman as a hared-charging prosecutor who unlike the feds and other state attorney generals, is not intimidated by Wall Street.

But Reuters financial blogger Felix Salmon argued that confidential audits, which were turned over to the Justice Department were a much bigger story than Schneiderman’s investigation.

Until Schneiderman’s investigation bear some fruit, I think history suggests we should be skeptical of officials who claim they are going to get tough on the banks and protect consumers.

Salmon pinpoints the real significance of the Schneiderman investigation – the continuing cracks in the state attorney general’s 50-state coalition that was negotiating with the banks to settle claims of mortgage fraud. Some Republicans had already criticized the state attorney generals for being too tough on the banks, referring to a proposed settlement as a shakedown. Other critics have raised questions about whether the attorney generals are being too soft, having sat down to negotiate without having done robust investigations first to gather ammunition.

Whatever the outcome of these on-going investigations’s, the week’s news guarantees one thing – the mortgage fraud scandal, and its offspring the foreclosure scandal, are not going away any time soon.

Muppets v. Goldman

The Scandal That Won't Go Away