Grace Ross: Why Our Trust in Government is Down the Drain

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Wednesday, February 15, 2012

Grace Ross, GoLocalWorcester MINDSETTER ™

 Two years of hot news headlines included:

The Commissioner of Probation is gone ... top officials resigned ... federal investigation ... state indictment ... the first federal indictment ... 250 employment decisions roughly were affected ... probably tens of millions of state dollars. And it’s been suggested that the criminal level of patronage in the Massachusetts Probation Department may have reached not only to the Speaker of the Massachusetts House, but to the then State Treasurer and one of our recent candidates for Governor.

Of course, this scandal of the Probation Department is critically important to clean up and very disturbing. In normal times, this certainly would rise to being a critical central issue for our state and our civic conversations. It included not just patronage inside the Probation Department, but violations of campaign contribution laws and clear examples of undue influence. This has been a recent example to provide hope for some media playing the investigative role that a democracy needs it to. 

However, I doubt that the scandal in the Probation Department (and similar stories) is really what undermines the general public’s trust in Government. Our trust in Government is now not just in the toilet but in the pipes below it. Many people have given up on Government playing a constructive role at all. 

In comparison to the magnitude of the probation scandal, consider this possibility: folks at the very top of our society publicly admit to literally millions of fraudulent and criminal activities; those activities damage the lives of 10 million or more people across the country; this involves literally trillions of dollars; the story is exposed by Attorneys General around the U.S. with the powers to arrest and throw in jail the perpetrators; the perpetrators themselves publicly admit to their illegal activities and splash the admission across the pages of every major news outlet across our country; And their illegal activities lead collectively to the largest transfer of wealth from regular people – what in the Occupy Movement folks would refer to as the 99% – primarily into the pockets of the uber wealthy in our society.

This is exactly what has happened! 

That level of scandal in a democracy one would expect to be the unremitting focus of our elected public servants – the primary focus of study commissions, grand juries swiftly issuing subpoenas and criminal charges with massive coordinated enforcement activities at every level of government across our nation. 

These are the actions of the major mortgage companies and then the banks that purchased them as they went under. They went out of business at the same time as sinking not just Worcester’s economy, the state economy, but our national and global economy. 

What has government done so far? Not much as the damage accumulates. 

Some argue the lack of criminal enforcement so far is because nobody knew what the lenders were doing or saw it coming. You need only to look at the FBI’s report from 2004/2005 where they publicly requested more investigators from the Bush Administration because the extent of fraud they saw in the banking industry was going to dwarf the impact of the savings and loans fraudulent activities in the 1980s. 

What has happened so far with all these public admissions of pandemic level fraudulent and illegal activities by some of the wealthiest forces in our society? 

A series of lawsuit settlements at the national and now state level have been announced. Based on investigations started a few years ago, these settlements so far amount to commitments by the largest lenders to not continue doing what was illegal all along. The first nationally is from the Office of the Controller. Then a national settlement with Bank of America for the Countrywide mortgages that were notoriously scandalous and so widespread that they set the industry standard – the sub-basement one of subprime mortgages since declared illegal in Massachusetts. Now we have a settlement between the Attorneys General and the largest banks to try to force changes in banking behaviors. 

No one I talk to on the street disagrees that what our government probably should have already done: some of these unabashed top bankers need to be cuffed and put away for the rest of their days. I believe that as least a few law enforcement genuine leaders with integrity are moving in exactly that direction – so we will see! 

Until then, the fixation on Probation Department corruption while important for any democracy is like getting lost among a few saplings and missing the entire redwood forest of the corruption scandal of our times and many decades to come: the actions of admitted felons (and government regulators who looked the other way) and to date remain in their comfortable luxurious offices, sitting on their plush couches, drinking their cocktails, in the most beautiful corporate suites at the top of the skyscrapers of the major cities of the United States. 

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