Perhaps I have posted on Bernie Madoff, I’m not sure. Of all the aspects of our gathering economic catastrophe, I guess it’s the part that I am least interested in. I mean, I guess its bad for the Jews and all, but this is really a sideshow, an epitomization of a crisis into a convenient image that can be easily grasped. What is most interesting about the whole Madoff case for me is 1) it seems that the only people he really scammed are the somewhat wealthy and the really wealthy. To me, I must say, I am angrier at corporations that go into bankruptcy to divest themselves of pesky pension obligations, or the people who over the past thirty years who have forced Americans into 401-K plans, forced everyone to invest in the market, and then watched everything go up in smoke. Perhaps Madoff didn’t give to the poor, but at least he only robbed from the rich. And (2), the reason why it was so easy for Madoff to swindle so many people is that hedge funds are all secretive—usually nobody quite knows what their money is being invested in, and there is little obligation on the part of hedge fund managers to say. People who invest in hedge funds are only interested in one thing—magic, some fairy dust to be sprinkled on their money which would make it grow like magic beans. It would be cruel to say that those who invested with Madoff had it coming to them, but then we all had it coming to us. And this is not because some of us foolishly invested and purchased properties they couldn’t afford. No, that’s chickenfeed. The real crime is that the American people and their elected representatives did little or nothing to block, monitor, or curtail the utter rapacity of our financial industry. For this, we all share in the blame. The chickens are coming home to roost, and in the immortal words of Louis Jordan, ain’t nobody here but us chickens.
Look, let’s have a little sympathy for Madoff and other Ponzi schemers. No one sets out to create a Ponzi scheme, I suspect. But stuff just sort of happens. You lose a few billions, and you are faced with a choice. Either you can (1) try to cover up your losses, like the original Mr. Ponzi, and all of his successors, like Bernie Madoff, through a bit of subterfuge, and hope that things will turn out okay in the end, though they never do, or (2), you can just say that your failure will cause irreparable damage to the world economy, that you are “too big to fail,” and demand money from the taxpayers to cover your sorry ass. I’m sorry, when it comes to financial peculation, Bernie Madoff is relatively small potatoes. AIG, Merrill Lynch, Lehman Brothers, and Bear Stearns are the big boys. The ultimate point of any Ponzi is to get some sucker to cover your losses. And guess who are the ultimate suckers? As Michael Kinsley likes to say, it is not what is illegal, but what is legal, that is truly frightening. And as Deep Throat liked to say, when you follow the money, make sure it leads to the president. Enough articles on what layer of Dante’s hell is fit for Bernie Madoff. He isn’t the biggest villain in this story, not by a longshot. My candidates would include Alan Greenspan, Hank Greenberg, Ace Greenberg, Robert Rubin, Chuck Schumer, and, to throw in a token non-Jew, George W. Bush