Who would have thought, even a few months ago, that the U.S. government would be frantically trying to stave off the meltdown of its entire financial system?
Danny Schechter, known with the moniker "the News Dissector," has been one of the few to incisively track the issue that Sen. Christopher Dodd, chairman of the Senate Banking Committee, called "a 50-state Katrina." Schechter has done so with his daily blog/newsletter at newsdissector.com; his 2007 documentary, "In Debt We Trust"; and now with the perfectly timed release of "Plunder: Investigating Our Economic Calamity and the Subprime Scandal."
The conversationally written book is essential reading in grasping the biggest financial collapse in more than three-quarters of a century.
Schechter, a former Nieman fellow at Harvard and graduate of the London School of Economics whose extensive journalism background includes an Emmy award-winning stint at ABC News, is uniquely positioned to expose the culture of greed and lack of government regulation that began with predatory subprime mortgages and spread through the interlinking global financial system.
"It was the largest robbery in history -- not a bank heist but a heist by banks," Schechter writes. "Its target was the American people, and it enriched a few while leaving whole neighborhoods devastated."
Schechter is a leading voice on media reform, and he indicts a news "infotainment" industry more concerned about shallow controversies and glamour than unsexy home foreclosures that threaten millions with the loss of their homes and mounds of debt. David Walker, comptroller of the currency, and former Republican strategist and author Kevin Phillips are among those who have sounded the alarm and been largely ignored by the media. Schechter, with his keen insight into the crisis, could have added his own name to that list.
At the heart of the problem is what Schechter describes as a vast "credit and loan complex," one he suggests is no less insidious than the military-industrial complex President Dwight D. Eisenhower named a half-century ago. This collusion of big banks and an array of finance, credit card and related companies, Schechter contends, have looted the middle-class and the poor through the transfer of enormous wealth.
The conservative, philosophical underpinning for this -- reaching full fruition during the Bush administration -- is the belief that financial markets are self-regulating and need little government interference. A massive, $700 million government bailout expected to pass at press time has proven that to be a disastrous fallacy. As Schechter points out, the crisis was possible only because of the dismantling of long-standing regulations, including the New Deal-era Glass-Steagall Act.
It's not possible to know what impact the bailout will have, or if there are other, related crises headed our way.
But Schechter's book is clearly a call to action for debt relief for those caught under crushing interest rates, and phantom industry rules and regulations; for investigating higher-ups responsible for subprime crimes; and for fairness in a corrupted financial system that -- as the present crisis has laid bare -- works for the few rather than the many.
Mark Sommer is a News reporter.
Plunder: Investigating our Economic Calamity and the Subprime Scandal
By Danny Schechter
191 pages, $29.95 ($14.95 paper)