The Patriot Post® · Economic Meltdown Leads to Justice Department's Big Bank Shakedown

Attorney General Eric Holder, acting on his Big Brother philosophy of government, has decided that one of the ways to achieve “justice” for the nation is to punish big banks for decisions they make – even if the decisions are made at the request of federal officials. It seems that banks and businesses are either “too big to fail” or too big to make a profit.

Last Thursday, Holder’s Justice Department will force Bank of America, the second largest bank in the nation, to pay $16.65 billion for damages it supposedly caused, leading to the financial crisis. Holder, who seems to equate justice to the amount of penalty money, boasted that this was “the largest such settlement on record.” Never mind that it has no basis in actual damages, or that no one knows how the penalty was calculated.

Bank of America is only the most recent victim of Holder’s Justice Department – other banks such as JP Morgan and Citigroup were forced to pay out huge sums of money in previous years. The Justice Department seems determined to punish corporations accused of doing wrong, though, of course, it depends on the definition of “wrong.” The alleged crime of Bank of America was that it purchased two failing financial institutions, Countrywide and Merrill Lynch, which had issued bad mortgage securities before the acquisition.

But wait, Bank of America didn’t decide to purchase those financial institutions alone. It was asked by the Federal Reserve and former Treasury Secretary Hank Paulsen to do Uncle Sam a favor. And, to borrow a phrase from the “Godfather,” it was an offer they couldn’t refuse – Paulson threatened to fire Bank of America CEO Ken Lewis. How can justice be served if Bank of America does what the government asks it to do and then gets punished for it later? It doesn’t seem like much justice is coming from Washington these days. That is unless you believe it’s business that perpetrates injustice and inequality.

Clearly, the Obama administration is using the economic meltdown and sluggish recovery caused by his failed socialist economic policies to “shakedown” Bank of America. Perhaps this is an additional version to so-called “economic patriotism” the president spoke of last month while campaigning in Texas. Since the government can’t take enough money from corporations that go overseas to avoid paying taxes, then those companies will just have to pay another way. What better way than to go after the big banks with big money?

The philosophy of Obama and Holder is revealed in their disdain for those in the free market who succeed – the goal is to break the back of free enterprise. They believe government should reward the lower and middle classes with money taken from those who have too much. Yet in reality, by punishing Bank of America and other big corporations, they hurt the very people they purport to help. After the penalty, there will be less profit remaining to give employees sufficient pay raises or to create new jobs. Government can’t punish corporations without inadvertently punishing the people who work for those corporations. Indeed, the government should seek justice when individuals have made mistakes, but in the case of Bank of America, it is the wage earners, shareholders and investors who will be hit the hardest.

There will be some that gain from this, however – the states of California, New York, Illinois, Delaware, Maryland and Kentucky, which have received portions of the settlement and coincidentally have Democrat attorneys general. One can only hope that there will be political backlash in the election this fall. If justice is to prevail in America, then those who reap from the injustice coming out of Washington need the boot.