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Class War For Idiots / April 28, 2010

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This article first appeared in The New York Press.

There was a strange moment last week during President Obama’s speech at Cooper Union. There he was, groveling before a cast of Wall Street villains including Goldman Sachs chief Lloyd Blankfein, begging them to “Look into your heart!” like John Turturro’s character in Miller’s Crossing…when out of the blue, the POTUS dropped this bombshell: “The only people who ought to fear the kind of oversight and transparency that we’re proposing are those whose conduct will fail this scrutiny.”

The Big Secret, of course, is that every living creature within a 100-mile radius of Cooper Union would fail “this scrutiny”—or that scrutiny, or any scrutiny, period. Not just in a 100-mile radius, but wherever there are still signs of economic life beating in these 50 United States, the mere whiff of scrutiny would work like nerve gas on what’s left of the economy. Because in the 21st century, fraud is as American as baseball, apple pie and Chevrolet Volts—fraud’s all we got left, Doc. Scare off the fraud with Obama’s “scrutiny,” and the entire pyramid scheme collapses in a heap of smoldering savings accounts.

That’s how an acquaintance of mine, a partner in a private equity firm, put it: “Whoever pops this fraud bubble is going to have to escape on the next flight out, faster than the Bin Laden Bunch fled Kentucky in their chartered jets after 9/11.”

And that’s why this SEC suit accusing Goldman Sachs of fraud is really just a negotiating bluff to give Obama’s people some leverage—or it’s supposed to be, anyway—according to the PE guy. He dismissed all the speculation that the fraud investigations would turn on other obvious villains like Deutsche, Merrill, Paulson & Co., the Rahm Emmanuel-linked Magnetar and so on.

“You don’t get it, Ames. Even Khuzami, the SEC guy in charge of the Goldman case, is a fraud; the fucker was Deutsche’s general counsel when they pulled the same CDO scam as Goldman. You have no idea how deep this goes.”

And it’s clear that a lot more people here are aware of how fundamentally rotten things are but they’re not willing to face the big fraudonomics bummer yet, preferring instead to stick with specific accusations.

My position on this was, “Good, throw the book at those crooks too, I don’t see what the problem is here.”

This was exactly what I argued a week ago, during a verbal slapfight with that acquaintance of mine. We were making a scene in a Midtown yuppie restaurant, arguing over just how much damage Wall Street had caused, and what to do about it.

His position was indefensible, and he knew it, so he switched tactics:

“OK Ames, which bankers would you throw the book at? Because you’re arguing that they’re all guilty. So which ones do you go after? Two of them? Three? Half of them?”

“Every last one of them. Lock ’em up in one of their private prisons.”

“Not gonna happen, Che.”

Che? Me? Listen, Scarface, I’m about law and order. Don’t any of you PE degenerates believe in that anymore?”

“OK, here’s the deal, Che. I’m going to walk you through this nice and slow so that even an agave-sweetened hippie like you can understand this. Stick with me, this is gonna be a little complicated. Ready?”

And so he began:

“Let’s say the government decides one day, ‘You know, we oughta listen to Che here, let’s throw the book at every firm and every executive that our people can make a case against. Because you know, gosh, it’s all about rule of law and blind justice, just like Che says.’ OK, so now this means indicting just about every serious player in finance, so they take down Goldman Sachs, they take down Citigroup, JP Morgan, BofA… and they also serve all the big funds who are at least as guilty, if not more. So they shut down Pimco, Blackrock, Citadel… maybe they indict Geithner and Summers, haul in some of Bush’s crooks… right?”

“Too bad they don’t serve popcorn here, this is getting good.”

“OK, now guess what you’ve just done? You’ve just caused the markets to completely tank. Remember what happened after the Lehman collapse? Remember how popular that made every politician in Washington? Still wondering why they coughed up a trillion bucks? They were scared for their lives; that’s why they voted for that bailout. You’d have done the same goddamn thing. But if we go after everyone guilty of fraud and theft, the market crash this country would see would make 2008 look like Sesame Street. Open that can of worms labeled ‘Fraud’ and the whole fucking economy collapses. You may as well prosecute people for masturbating. No one will know where the fraud investigation stops and who will be charged next—everyone will try to cash out, and the markets will tank to zero. And guess what happens when the markets tank to zero? Every fucking American with a retirement plan, or an investment portfolio, or a 401k—every state pension plan in the country, every teacher’s pension fund, every fireman’s pension—every last one of them will be wiped out. That’s what the Lehman collapse taught us.”

“Us? It didn’t teach us anything but that this country is run by maniacs.”

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“Jesus H. Christ, Ames– you’re even more clueless than the idiots who managed the Lehman collapse. I mean, didn’t everyone get it how badly those idiots screwed up with Lehman? It was the biggest screw-up this hemisphere has ever seen. You had Secretary Paulson and Fed Chief Bernanke scratching their asses not knowing what to do, so then they go, ‘OK, we’re supposed to be a free market economy, and we’re supposed to be the Republicans—let’s try something different for a change since nothing else is working. Let’s go out on a limb and actually give this “free market” thing a whirl. Who knows? Maybe the “free market” really works the way we always say it does. Nothing else seems to work, let’s let the free market decide Lehman’s fate. Maybe corporate-socialism isn’t the answer.’ So they hung Lehman out in the free-market, and BAM! The. Shit. Hit. The. Fan. No shit, dudes—the free market is for suckers, didn’t your daddy teach you idiots that? Not only did Lehman collapse—everything collapsed; confidence in the entire system collapsed. And here’s what I’m trying to explain to simpletons like you: Our economy is just a confidence game. Don’t ask me how it got this way, don’t care.”

I tried saying something insulting to him, but he just talked right over me, lurching forward baring his laser-whitened teeth.

“I’m sure you have the answer, you and Ron Paul and all the other pot-smoking libertarian do-gooders have it all figured out. But what I’m saying is, no confidence means end of the confidence game. That’s what Lehman showed. Every single player in finance suddenly had to face the fundamental problem—this whole fucking economy is built on fraud and lies and garbage. So when Lehman collapsed, every single player panicked, going, ‘If Lehman was nothing but a Ponzi scheme—and I know what I’m running is a Ponzi scheme—holy shit, that means everyone else is running a Ponzi scheme too! Run for the exits!’ No one trusted anyone else, everyone pulled out, and the entire global economy collapsed just like that. And that meant your parents, my parents, every teacher, every fireman, every person in the country going into retirement, every price on every asset—wiped out.

“And here’s what I’m trying to get you to understand: In the grown-up world, when an entire country’s savings accounts are wiped out because of some do-gooder and his law books and his Thomas Jefferson ‘What about free and fair markets?’ crap, that is a big problem—people don’t give a fuck about Jefferson and ‘free and fair markets,’ they just want their savings to be worth something. And people are right: Jefferson was an imbecile. He should have been a folk singer, not a Founding fucking Father. But that’s another issue that’s over your head—the point is, the guy who destroys this economy because it’s ‘the right thing to do’ will have to flee for his life, and whatever president or political party was in power when that decision was made will be out of power for the next 200 years. That’s why Washington panicked and passed ‘the bailout,’ they didn’t want to be the fools whom all the Ponzi victims blame for tanking the Ponzi scheme, so they broke the glass and pumped up a newer, bigger Ponzi scheme. It was an expensive 14 trillion dollar lesson in, ‘Stay the fuck away from free-market experiments, assholes!’ How naive are you people to actually believe that ‘free market’ crap? The problem is when people in power are stupid enough to listen to guys like you: all the do-gooder libertarians and the do-gooder free-market Republicans who forgot that they’re supposed to lie. Hello!”

“Libertarian, me? Since when was I ever a libertarian?”

“That’s my point: Fools like you don’t even know who you are anymore. They forgot that they’re supposed to lie about all that libertarian free-market shit, keep it far the fuck out of policy. But instead of just lying about free-markets while secretly propping up Lehman, the idiots actually tried pulling off a ‘free-market’ miracle, and we had to pay $14 trillion just to find out what I could have told them for no fee at all, which is: ‘Hey, assholes, you’re supposed to be hypocrites, OK? You’re supposed to be two-faced free-market liars, not libertarian Quakers! You’re not supposed to believe in anything—your job is to get up in front of the public and lie about free markets and the rest. Period.’

“That’s it, how fucking hard is it? Look, watch my face: Say one thing out of one side… and do the other out of the other side. Got that? Let everyone else whine and cry about, ‘Ooh, that’s not fair, ooh, that’s a bailout, that’s socialism, that’s corruption.’ That’s what losers do—they whine. You, for example, Che—you whine all the time, and look at you… Can you pay the bill for this meal? Is there a libertarian on earth who can afford to buy a decent meal in Manhattan? And now, look at me: I’m a hypocrite. Hell yes I am! I lie every day of my life, I lie to myself in my sleep. Hell, I’m lying to you right now, in fact I don’t even know what the fuck I’m saying anymore because I’m so used to lying. And yet—who’s the guy with the black card? Who’s the one who’s going to pick up the check tonight? Guys with power, guys like me, we lie. You got that? ‘Lie’ as in ‘My Lai’ the massacre—as in, ‘My Lai you long time, me so free-markety.’ You distract the dumbshits with free-market B.S. because hey, for whatever reason, that’s what the public likes to hear, it doesn’t really matter what lie you feed them so long as it’s the lie that puts them in a trance. And then behind the scenes, you do the very opposite: You fix the game, you cover up this problem here with those funds there, you move shit around, you skim budgets and you subsidize the system, you cover up the bad shit and once in a while throw a has-been to the wolves to keep the public entertained—that’s the way the system works, and anyone who’s an adult understands that. And everyone who doesn’t understand that can go form an online libertarian chat group and complain with all their little libertarian friends about free markets and Jekyll Island and ‘Wahhh! It’s not not fair, waahhhh!’”

“What’s with the libertarian accusation?”

“It’s just that you all sound the same to me. Libertarians, hippies—is there really a difference? You all whine alike: ‘It’s not fair, man! Ooh! You can’t do that, it’s fraud, it’s corruption, ooh no!’ Or: ‘It’s the income inequality, man; Goldman Sachs controls us all man; it’s socialism for the rich; it’s all too scary for my retarded 5-year-old libertarian brain!’ Seriously, anytime I meet libertarians like you—”

“Listen—I’m not a fucking libertarian, OK? I want free handouts. How clear do I have to make this? Me—handouts. Me—Big Government. I want to collectivize your productive cash, because I am a resentful parasite. Are you capable of processing a single word of what I’m saying to you, Spaz?”

“Uh-huh, sure, whatever. Here’s the thing: I think it’s great that you and your friends memorized Road to Serfdom in between Star Trek episodes—no really, I’m happy for you. Yeah, we’re all so proud. But here’s the thing: We grown-ups are really, really busy now trying to sort out the free-market mess you made with that Lehman move of yours. Yeah, so why don’t you run along to your libertarian chat rooms and have your little debates about Jekyll Island and the gold standard, because it really means a lot to us. And report back to me as soon as you have it all figured out, m’kay? Just get the fuck out of my face and leave the adults alone.”

It got a lot more vicious and personal than this, but when our verbal slap-fight ended—and he paid the bill—I thought about what he said, and it made a lot more sense. Fraud has become so endemic in this country that it’s woven its way into America’s DNA, forming a symbiotic relationship that can’t be undone without killing off the host. [See below: Fraudonomics: 10 Fun Fraud Facts] If they push it just a little too hard, the entire American economy could crash, asset values could tank, and that means tens of millions of extremely pissed off retirees and Baby Boomers. As the Wall Streeter put it: “Whoever is responsible for bursting this latest bubble by exposing all the fraud—and tanking all the markets—will not only be out of power for at least a generation, but they’ll all have to get radical reconstructive surgery on their faces and seek political asylum somewhere remote. No one wants to be that guy, and that’s why it’s not going to happen.”

That may be true, but all bubbles do eventually burst, all Ponzi schemes do collapse for good at some point. The only question is when. For those of us not on the verge of retiring, the sooner we have this day of reckoning and get it over with, the better.

*      *     *

Fraudonomics: 10 Fun Fraud Facts

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Ever since I got kicked out of Russia and forced back home, I’ve been collecting all kinds of news articles about fraud, in a document file titled “America Is Russia.” Here’s a little taste of the wonderful world of American Fraud:

1). Accounting Fraud: Last year, America’s leading banks were insolvent. They had tens or hundreds of billions in losses on their books, and the only way to wipe those losses out would be to either a) own up to the mess, raise enormous amounts of money on top of all the bailout money; or b) get out a big fat eraser, and wipe those losses off the books as if they never existed. The first option was nice and all, but a real hassle. So Geithner and Larry Summers chose Door Number Two: Accounting Fraud. They forced the FASB to accept a rule-change in the accounting methodology called “mark-to-model” which let banks decide how much their assets were worth, rather than letting the markets decide. So if for example a BofA owned a complex security called “Orion Butt Fungus” that was worth 5 pesos on the open market, but BofA was too broke to go out and raise 5 pesos to cover that loss, under the new accounting rules, the government told BofA that rather than pricing “Orion Butt Fungus” at what the market will actually pay for it, why not first ask, “How much would BofA like ‘Orion Butt Fungus’ to be worth, in a perfect world?’” If BofA answers, “Doyee, gee I dunno, how about $500 million?” then under the “mark-to-model” accounting rules, BofA could now value “Orion Butt Fungus” at $500 million, and voila! Their problems are over. That wasn’t so hard, was it? Suddenly, BofA looks like it knows how to pick winners! And no one’s going to second-guess them, because everyone else is mark-to-modeling their “Orion Butt Fungi” too! The end result: under the old rules, BofA would have had to raise money just to cover its debts, sort of like you and me have to do, and that’s just a lot of money going to waste. But now that its portfolio is so profitable, BofA has a much easier time raising money, which it uses to pay ginormous bonuses to its executives.

2). Big Pharma Fraud. Remember that scene early in Fight Club, when Edward Norton explained his job, when it was more profitable to let a car defect go and pay whatever lawsuit settlements come from the deaths, and when it’s better to recall the cars because the number of deaths will result in too many lawsuits? This is humanitarian do-gooder stuff compared to the savage real-world fraud-for-profit model that drives America’s drug companies. It’s really simple and it goes like this: the more fraud a drug company commits, so long as it’s off-the-scale fraud with the most horrible consequences for the victims, the drug company’s profits always outdo the criminal fines and lawsuits by factors of 20, 30, 100… It’s as simple as that. Because the billion in penalties here or the two billion in class action lawsuit settlements there are always far less than the tens of billions you earn from pushing harmful drugs on unsuspecting idiots. To wit: Between May 2004 and March 2010, a handful of top drug companies like Pfizer, Eli Lilly and Bristol-Myers paid over $7 billion in criminal penalties for bribing doctors to prescribe drugs for unapproved uses, with sometimes deadly consequences. However, as a Bloomberg report noted, the fines are always a fraction of the profits—Pfizer alone paid almost $3 billion in criminal fines since 2004, yet that was just one percent of their total revenues; Eli Lilly got busted bribing doctors to prescribe a schizophrenia drug, Zyprexa, to elderly patients suffering from dementia, even though company-run clinical trials showed an alarming death rate of 31 people out of 1,184 participants (double the placebo rate). Whatever—the market for elderly dementia patients meant billions in extra revenues. So Eli Lilly continued pushing Zyprexa on the elderly for another four years until it the Feds busted them. Eli Lilly got hit with $1.42 billion fine, but that was peanuts compared to the $36 billion it earned on Zyprexa sales from 2000-2008. To make it happen, the drug companies buy off all the checks and balances: lawsuits revealed the enormous bribes they pay to doctors, and even America’s medical journals are so corrupted by drug company influence that they’re no longer reliable as much more than hidden advertisements, according to a recent UCSF study. Medical journals are 5 times more likely to publish “positive” drug reviews than negative reviews, and one-quarter of all clinical trials are never published at all, leading doctors to prescribe drugs assuming they have all the information. The result: prescription drugs kill one American every five minutes …while Americans pay more for drugs than anyone in the world, spending a total of $12 billion on drugs in 1980 to spending $291 billion in 2008—a 1,700% increase. America is ranked only 17th in the world in life expectancy.

3). Alan Greenspan: Fraudonomics Maestro. America’s central banker from 1987-2006 once told a do-gooder regulator not to fuck with the bankers’ fraud schemes, because in Greenspan’s mind, fraud was not a crime and didn’t need to be regulated. Then Greenspan forced the regulator, Brooksley Born, to resign. Just in time for his next and final act as Central Bank chief: from 2001-2004, Greenspan pumped up the biggest housing bubble in human history by holding rates down to nothing, while touring the country promoting the glories of subprime and Alt-A mortgages. Then in late 2005, when the bubble was ready to burst, Greenspan tendered his resignation and switched over to the other side, signing lucrative contracts with three investment firms all of which bet big against gullible American homeowners, and reaped billions. First, Greenspan signed up to work for Deutsche Bank, which is being sued for securities fraud for selling an Abacus-like CDO to a Warren Buffett-owned bank, M&T; Greenspan also worked for Pimco, which earned $2 billion in a single day in September 2008, when Fannie Mae and Freddie Mac were nationalized with Greenspan’s lobbying help; and lastly, Greenspan went to work for Paulson & Co., the hedge fund that raked in $1 billion off the same Abacus CDO deal that brought the SEC fraud suit against Goldman Sachs. It’s an unusually perfect record for Greenspan, given his atrocious forecasting record at the Fed. It recalls the old Greenspan circa 1984-5, when he worked as a lobbyist for Charles Keating trying to push regulators off his back and vouching on the record for Keating’s character…Keating was eventually jailed for fraud in the worst savings and loan collapse of all.

4). Municipal Debt Fraud. America’s $2.8 trillion municipal bond market is rife with fraud of the sort you’d expect in an emerging tinpot economy: opacity rather than transparency, plenty of corruption and kickbacks, resulting in decimated budgets and services cutbacks in communities across the country. The problem all stems from way the bonds are issued these days: instead of holding open tenders, nearly all are the result of backroom deals. Back in 1970, only 15 percent of municipal bond contracts were awarded through no-bid contracts; last year, 85% of muni bond deals were assigned in no-bid, non-transparent agreements of the sort that made Halliburton rich in Iraq. Studies show that no-bid bonds invariably cost municipalities more than bonds resulting from open tenders. So far, fraud and corruption charges have been leveled against state employees and city councilors in Florida, New York, New Mexico, Alabama and California, to name a few. Muni bond defaults soared from just $348 million in 2007 to $7.4 billion in 2008—that’s an increase of 20 times– with growing numbers of cities, counties and states on the verge of bankruptcy. And here’s the real kicker: the biggest bailed-out banks and funds stand to make huge profits again if California’s state and city bonds fail–meaning they make big fees selling the bonds in corrupt deals, then they bet against the bonds buying CDS derivatives. Right now Wall Street has a $27 billion bet against the California bonds they helped to sell–and you better believe Wall Street will use every trick in the book to push California into bankruptcy and make those CDS bets pay off big. In fact just last year, the big banks made $1 billion in fees by selling off Obama-stimulus-backed Build America Bonds which were basically a way of massively overpaying bankrupt banks to lined up bankrupt cities and states with skittish investors to fund corrupt projects–like the San Francisco Bay Bridge modernization, which went from $1.8 billion to $13.6 billion, $8 billion just in interest. Good news is that Wall Street is making tons of money, which is always something to cheer–and of course, the bill is all being charged to regular car-driving suckers, who pay a $5 toll today to cross the bridge, up from $2 in 2003.

5). Journalism fraud. The Washington Post got caught whoring out their venerable editorial staff to corporate lobbyists for anywhere from $25,000 to $250,000 a date, depending on the access. The Atlantic Monthly admitted to TalkingPointsMemo that it routinely sold access to its editorial staff for cash. As for business journalism, all sorts of articles and studies have asked the obvious question: “How did every mainstream business outlet miss the financial collapse of 2008?” Among all the self-flagellating mea-kinda-culpas, you won’t find the word “fraud” in their answer. Speaking of business journalism and fraud, The Business Insider, one of the top business news blogs, published a pair of articles defending Goldman Sachs against the SEC fraud charges. The author of the articles defending Goldman Sachs is Business Insider’s co-founder and editor, Henry Blodget. In 2003, Blodget himself was charged with securities fraud by the SEC for repeatedly misleading clients into buying stocks of companies that in private emails Blodget referred to as “piece of shit.” Under the terms of Blodget’s settlement with the SEC, he agreed to a lifetime ban from the securities industry, and he paid $4 million in fines and disgorgements. Since he is not barred from the world of business journalism, Blodget was able to post an article last Friday headlined: “HOLD EVERYTHING: The SEC’s Fraud Case Against Goldman Seems VERY Weak.”

6). Fraudonomics K-12. If you want your kid to grow up to succeed in a fraud-based economy, you need to teach him the ABC’s of cheating starting at a young age. This is one area where America’s schools aren’t failing their students. Cheating is so rampant in schools that nowadays if the student doesn’t cheat on his exam, chances are his teacher or administrator will cheat on his test for him. One in five elementary schools in Georgia are currently being investigated for tampering with the students’ standardized test scores—although suspicious patterns of erasing and remarking answers showed up in half of the state’s elementary schools. In California, as many as two-thirds of its public schools admitted to fudging its students’ standardized test scores. A survey of graduate school students found that 53 percent of business school grad students admitted to cheating, more than any other grad school discipline. Overall, up to 98 percent of college students today admit to cheating, compared to just 20 percent who cheated in 1940.

7). Boardroom Fraud. Corporate America’s boardrooms are stacked up these days in tight, intertwined relationships that turn public companies into crime scenes, plundering money from unsuspecting shareholders and divvying up the loot among the directors and top executives. In 2008, Chesapeake Energy’s stock price collapsed from $74 per share to $9.84, wiping out $33 billion in shareholder value. The CEO, Aubrey McClendon, gambled and lost 94% of his stock in the company on a margin call, personally losing about $2 billion. So what did the board of directors do? They voted to award McClendon $112 million for 2008, the highest of any CEO in America. Shareholders were outraged, calling it a “bailout,” and several pension funds tried suing Chesapeake, but the courts in Oklahoma blocked the lawsuits. That’s because Aubrey McClendon is sort of the George Bush of Oklahoma—a spoiled fuck-up with a rich and powerful granddaddy—Robert Kerr, former governor and senator, and founder of Kerr-McGee—meaning plenty of VIP connections for the loser grandkid. So on Chesapeake’s board, you had Aubrey’s cousin, Breene Kerr; Frank Keating, Republican ex-governor of Oklahoma whose son Chip (and Chip’s wife) works for Chesapeake; Don Nickles, Republican ex-Senator of Oklahoma who co-funded with Aubrey the Republican anti-gay marriage campaign in 2004; Richard Davidson, the former head of Union Pacific, whose corrupt board of directors (which included the head of the US Chamber of Commerce) lavished Davidson with tens of millions in bonuses and a $2.7 million per year pension when he retired… Now multiply a board of directors like this by the sum total of “Corporate America” and you get…a corrupt, tin-pot corporate culture masquerading as a civilized First World corporate culture. That’s us. (You can read about this problem in an excellent new book Money For Nothing: How The Failure of Corporate Boards is Ruining American Business and Costing Us Trillions.)

8). Corrupt credit rating agencies. The only way big institutional investors like pension funds could justify buying a piece of the Orion Butt Fungus CDO pie was if ratings agencies like S&P or Moody’s gave it a top-notch seal of approval: AAA rated, with a little star on the forehead for good behavior. And in the world of fraudonomics, good behavior looks like this email from a Standard & Poor ratings analyst in December 2006:

“Rating agencies continue to create an even bigger monster _ the CDO market. Let’s hope we are all wealthy and retired by the time this house of cards falters.”

The happy ending to this story is that a huge percentage of thieving scum like this emailer saw their hopes become reality: they got wealthy and retired before the CDO market crashed in a trillion-plus dollar heap of shit. And if they didn’t retire, even better—because bonuses in 2009 were soaring, thanks to the always-gullible American taxpayer.

9). Regulatory Fraud: In the OTS, OCC, Fed, pension benefit guaranty agency and of course the SEC, where whistleblowers were routinely ignored because the regulators were too busy painting their monitors while surfing sites like www.fuck-my-wife.com.

  • 10). Judicial Fraud: Juvenile court judges in Pennsylvania took millions of dollars in kickbacks from privately run prisons in exchange for sentencing thousands of innocent kids to juvenile prison terms. Chronic on-the-bench masturbation is running rampant: an Oklahoma judge was accused of using a penis pump on the bench, while nearby in Texas, a Harris County judge masturbated and ejaculated on a defendant’s hand. Speaking of Texas, the entire juvenile prison system there was turned into a sex abuse racket involving Texas state officials–over 750 official complaints about prison administrators molesting or raping underaged inmates in all 13 juvenile facilities had been officially logged between 2000 and 2007.

  • The list goes on and on. Hell, even our literature was corrupted with fraud: James Frey’s addiction “memoir” A Million Little Pieces turned out to be A Million Pieces of Bullshit, the biggest literary fraud of our time. Fooled readers sued, Oprah chewed him out and Frey is now a bestelling “fiction” author. Frey was just one literary con-artist among many, recounting fake tales of street prostitution, being raised by wolves, even fake Holocaust memoirs (read John Dolan’s article about literary frauds).

This is just scratching the surface, but you get the point. We’re way past the point of redemption. No wonder everyone’s dreaming of a violent apocalypse to wipe the slate clean, and take us away to another plane where everything would be better. Anything but this.

Mark Ames is the author of Going Postal: Rage, Murder and Rebellion from Reagan’s Workplaces to Clinton’s Columbine.

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112 Comments

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  • 1. mike p  |  May 12th, 2010 at 7:42 am

    Look,if this article if only 50% semi TRUTHFUL,should somewhat scare the S–T out of every American (still alive )! Somehow the Idiots we’ve elected in the passed 50 yrs. Have screwed up everything that was Good and Great about this God Givin’ Country,plus all the Blood that has been givin to keep it’s Ideals Alive… Tell the Mother’s and Father’s, and Aunt’s and Uncle’s,and Sons/Daughter’s of all those that have died for this country! THAT THEY DIED FOR NOTHING..!!! We ( still alive ) Americans have to get off our asses and take a Stand for all the has gone before us…Vote! Vote! Vote! them all out of office…Follow your Local Elections, investagate these new canidates,vote your best choice for change! The belief in America,The old Ideals, of Good and Bad. Good begats Good, Bad gets what it deserves!

  • 2. Kevin  |  May 17th, 2010 at 9:25 am

    Thank you Colonel House et al.. for nothing

  • 3. Summerian  |  August 29th, 2010 at 7:57 am

    I’m a real deal philosopher. I don’t care about how you feel about anything. I do logic. You must understand this.

    Gold does not have more than selfvalue – just a metal.
    So the idea that it does is flawed.
    To then have this idea as a fundation for a society is more than corrupt. It is so deficient and inadequate you will end up without a society.

  • 4. Rocketman  |  September 16th, 2010 at 12:17 pm

    I AM a Libertarian and the more that I read this the angrier that I got! Let me ask the POS that you were talking to one important question. What’s going to happen when all of this collapses in on its self? When his greed and arrogance is responsible for millions of Americans not being able to feed themselves and their children, no money to buy medicine or put a roof over themselves? Disgust does even come close to what I feel towards him. And there something else that he might want to consider. History has a way of repeating itself and right now I suggest that you start reading up on what happened to people like you back in 1789 France.

  • 5. Adam  |  October 7th, 2010 at 1:55 pm

    The end of the article reminds me of the song aenema by tool.

  • 6. mudangel  |  October 22nd, 2010 at 8:35 am

    sounds to me like your banker buddy is scared shitless, no matter how much they keep proping up this bubble, its going to burst sometime, whether that markets crash and people eff the Wall street jokers up because of the “loss of their savings”, or the markets continue to be propped to the point that they literally squeeze every last bit of sanity from the populace to pay for it until the thread snaps and the people eff the Wall street jokers up because of that. Either way at this point they are going to take everyone they can with them. They are going to be royally screwed in the end and they are just trying to make it out alive. The head haunchos will probably head for the hills when they see it coming and all that will be left will be the little worms like that guy you had lunch with, who will lash out just like a wild animal that’s been backed into a corner.

    The doom is inevitable, if that guy survives maybe you can repay him for lunch with an “I told you so” and an MRE.

  • 7. fissionfusion  |  November 4th, 2010 at 12:43 pm

    Brilliant.

    All these fucking retards sitting here whining about “hang them!!!!!” are exactly the type your acquaintance was talking about. These are the amoral fucktards who think they can fix the economy and run the nation but can’t even afford to pay their bills on time.

    Fuck them.

    Simple fact is we are living a lie, and in doing so we are living the truth. The lie is that this is a global train that can’t stop, and won’t stop no matter what you political heathens think. Contrary to popular belief amongst a majority of you fucks, the economy does not revolve around you and your checking account – you are worth less than a TJ gutter whore on a Tuesday night during the World Cup.

    You either bask in it with full knowledge the shit is going down, or you bask in it willfully ignorant of your own value as a piece of shit.

    In short. Dude has it spot on. Anyone who disagrees, fuck you pay me.

  • 8. Christina Marlowe  |  July 4th, 2012 at 3:42 pm

    http://corporatewhoredomsandtheamericankleptocracy.wordpress.com/video-filthy-criminals-in-the-u-s-kleptocracy/

  • 9. Sarah Jackson  |  August 25th, 2012 at 12:49 am

    for me this is True story 😀

  • 10. Crazyzrg  |  January 11th, 2013 at 6:29 am

    The problem that I have with this is, okay, our entire system is based on corruption and fraud and to do anything would destroy it. Well okay, destroy the system, destroy every system based on fraud and lies. You think all this isn’t about to fall apart anyways, you think that more than half of Americans aren’t already living at the poverty line barely scraping by, you don’t think more than half of the world is already starving and poor. What we need is to dismantle our economic and political systems, throw away the pieces and start from scratch.

  • 11. RockyRacoon  |  March 25th, 2013 at 1:34 pm

    Guess what all those pensions are gone anyway Holmes may as well crash the system and get honest. Time to come to Jesus baby!
    At least then with a half decent project for renewal infrastructure clean energy tax all the mother freaking wealth they pulled out of the ponzi scheme because they stole it in the first place Holmes hey you wanna make an omelet holmes u gotta break a few legs.

  • 12. John Durham  |  April 21st, 2013 at 11:23 pm

    David Stockman is correct, the 2008 financial tragedy “…occured only in the canyons of Wall Street, Main street not being affected.”

    We don’t have a true financial system at the moment. But we, more or less, haven’t had one since the demise of Bretton-Woods (Nov 1971). Wall Street Banker’s rule became absolute, between the later years of Eisenhower and early years of Nixon. An actual large national financial system gradually went away over a period 1971-July 2007. It changed into a sort of predatory casino, affecting everyone who decided to play there. But, only them. Except where government, in their ignorance, chose not to protect The People from what big banks were doing, ie, the banking foreclosure thefts.

    Outside of this ring of fraud, that was described as a financial system, there was and still is, banking and life in this nation. Since the bailout there has been no large bank action that helps or hurts the nation. The $29Trillion given by the Fed in FED NOTES, to the big banks to play with is not anymore related to the real economy than BitCoins are. Wall Street may not be occupied, but they are isolated, playing with themselves…having forgotten how to reproduce…

    If the President were to decide tomorrow, like Kennedy sort of in ’63, to print US NOTES, then put them out through Treasury loans to 50 State Public Banks he could Constitutionally do it. Ignoring Wall Street, State Banks would hold their own deposits and bond all state, county & city activities. Ignoring also, the Fed they would be the clearing house for community banks in each state. Of course Wall Street and the Fed would simply wither away from lack of available money created by The People’s creation of real wealth…

    A National bank, fully owned by the government, using double entry accounting, would issue US Notes, US Bonds, etc. showing on its books, all these creations of Credits and Debits. For instance one form of Credit would be payments for Congressional Bills, each one a Debit against the bank’s books, after all. Right? Holders of US Bonds would, of course, be more obviously Debits on the books. Money held would actually be a Debit, owed to The People, while money flowing into State Banks would be a Credit, ie, a Credit on the National Bank books, a Debit on the State Bank books and, etc.

    Accounting has to do with keeping track of things, it is not economics. What is Economics?

    The word Economics is a sacred term and means only one thing. It is a Republic art of materializing Faith in Human Beings and all Life, by Creating money for the use of The People (those creating all the real wealth in a financial system, remember?) so that they, The People, can (and will of course) operate at their HIGHEST HUMAN POTENTIAL.

    Those who define it otherwise are not yet economists, not having gained the understanding of the Spiritual Nature & Dynamics of that mysterious and grand human activity.


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