<story><title>Bankers now Too Big to Jail</title><url>http://www.rollingstone.com/politics/news/gangster-bankers-too-big-to-jail-20130214</url></story><parent_chain><item><author>tptacek</author><text>She does get a straight answer. Regulators don&apos;t sue; they have a steady-state relationship with the banks where their concerns are addressed with consent decrees. Lawsuits are insanely expensive in the best of cases, but they&apos;re worse when you&apos;re suing a megabank, because the suit impacts the broader economy.&lt;p&gt;It is a little disingenuous for Warren to act surprised about this. She knows not only why regulators don&apos;t sue, but also how unlikely it is that we&apos;re going to start doing that (it&apos;d be economically irrational for us to do so).&lt;p&gt;Her heart is in the right place. Too Big To Fail is a real problem. But if you&apos;ve got a bunch of wasp nests in your back yard, you don&apos;t fix the problem by jamming sharp sticks into them.</text></item><item><author>callmevlad</author><text>This related hearing [1] led by freshman senator Elizabeth Warren is eye-opening. She can&apos;t get a straight answer on the last time a major bank was taken to trial over its offenses.&lt;p&gt;[1] &lt;a href=&quot;http://www.dailykos.com/story/2013/02/15/1187417/-Elizabeth-Warren-to-bank-regulators-When-was-the-last-time-you-brought-Wall-Street-banks-to-trial&quot; rel=&quot;nofollow&quot;&gt;http://www.dailykos.com/story/2013/02/15/1187417/-Elizabeth-...&lt;/a&gt;</text></item></parent_chain><comment><author>suresk</author><text>&amp;#62; [...] but they&apos;re worse when you&apos;re suing a megabank, because the suit impacts the broader economy.&lt;p&gt;I don&apos;t disagree with the factual correctness of this statement, but the implication is unsettling. Any kind of legal action from the government - from throwing someone in jail for possession of marijuana to suing banks over financial crimes - has negative economic consequences. If we send someone to jail for drug possession, we spend a lot of money investigating and prosecuting them, we pay to keep them locked up, we happily give up their productivity and any taxes they would have paid, and we reduce their long-term value to society by hanging a public arrest record on them. So, where do we stop using economic consequences as a reason for not enforcing laws?&lt;p&gt;I&apos;m somewhat highly-compensated and I contribute a lot back to the economy, though consumption and taxes. Should the government prosecute me and someone who only earns minimum wage differently, since prosecuting me and throwing me in jail will have a substantially higher negative impact on the economy? Maybe I get 2 or 3 free misdemeanors per year, your average millionaire gets a free felony, and if you are on Fortune&apos;s top 100 list you get 3 free felonies?&lt;p&gt;I&apos;m seeing more and more justification of not going after big companies and powerful executives due to the economic impact, and I think that is getting awfully close to codifying different legal systems for rich people and poor people. Certainly it already exists to a degree, but at least we sort of pretend that it is distasteful now.</text></comment>
<story><title>Bankers now Too Big to Jail</title><url>http://www.rollingstone.com/politics/news/gangster-bankers-too-big-to-jail-20130214</url></story><parent_chain><item><author>tptacek</author><text>She does get a straight answer. Regulators don&apos;t sue; they have a steady-state relationship with the banks where their concerns are addressed with consent decrees. Lawsuits are insanely expensive in the best of cases, but they&apos;re worse when you&apos;re suing a megabank, because the suit impacts the broader economy.&lt;p&gt;It is a little disingenuous for Warren to act surprised about this. She knows not only why regulators don&apos;t sue, but also how unlikely it is that we&apos;re going to start doing that (it&apos;d be economically irrational for us to do so).&lt;p&gt;Her heart is in the right place. Too Big To Fail is a real problem. But if you&apos;ve got a bunch of wasp nests in your back yard, you don&apos;t fix the problem by jamming sharp sticks into them.</text></item><item><author>callmevlad</author><text>This related hearing [1] led by freshman senator Elizabeth Warren is eye-opening. She can&apos;t get a straight answer on the last time a major bank was taken to trial over its offenses.&lt;p&gt;[1] &lt;a href=&quot;http://www.dailykos.com/story/2013/02/15/1187417/-Elizabeth-Warren-to-bank-regulators-When-was-the-last-time-you-brought-Wall-Street-banks-to-trial&quot; rel=&quot;nofollow&quot;&gt;http://www.dailykos.com/story/2013/02/15/1187417/-Elizabeth-...&lt;/a&gt;</text></item></parent_chain><comment><author>Cushman</author><text>That&apos;s a little uncharitable. It&apos;s obvious that Senator Warren&apos;s real question is: Do the banks have any reason to feel as if they face a threat of real legal action if they break the rules?&lt;p&gt;If not, that&apos;s surely something we can and should change.</text></comment>