Saving 30,000 Jobs
How the Teamsters Beat Goldman Sachs
By ANDREW COCKBURN
Among the causes of the ongoing financial meltdown, many experts cite the Commodity Futures Modernization Act, smuggled through Congress late on a December evening in 2000. The law exempted Credit Default Swaps (CDS) which are essentially bets on the value of securities from all regulation, including state gambling laws. This allowed Wall Street to conclude that any risk could be hedged with a bet. The result, of course, was disaster, with economic consequences that we will be feeling for a very long time.
“When I wrote part of that legislation with these hands on my little keyboard,” a former financial industry lobbyist who helped craft the law recently told me, “I didn’t realize that this was going to make people lose their jobs, pension funds their reserves, universities their endowments. But that’s what happened”
There are now shelves full of books describing the disaster caused by the enabling of Wall Street as a wide open casino. Butt amidst the wreckage and plaintive cries for “reform,” Wall Street is full tilt in the business of destroying companies and throwing thousands of men and women out of work in order to turn a quick profit on a CDS trade. more