My interest in Elvis and hamburgers matured over decades into a fascination with the whole American political process - fuelled, perhaps, by my intimate knowledge of Lincoln's fine words.To be honest I’m a politics junkie. I could go on any quiz show and answer questions on anything from ‘The Wit and Wisdom of Dick Cheney’ to ‘Who was that woman?’

Lincoln’s idea of democracy came to mind recently as I was reading a book on the financial crisis of 2008. The author explained that the American taxpayers had 'bailed out' Wall Street. As I understood it, when the whole financial house of cards began to totter, everyone was frantically looking around for some glue to stick it back together before it shattered like Humpty Dumpty, to mix a metaphor with a nursery rhyme. Luckily, the taxpayers obliged with a donation of $4635 from every single working American. Their generosity amounted to a staggering $700 billion.

 This seemed to me a laudable example of democracy in action. The entire country chipped in to save Wall Street from disappearing down the toilet. Sorry, that’s probably an inappropriate analogy. The taxpayers ‘baled out’ Wall Street - removing the water from the bowl so to speak. If a democracy isn’t about everyone helping poor unfortunates fallen on hard times through no fault of their own, then what is it about?

The next sentence will appear somewhat far-fetched but I assure you it's true. A few nights ago I was trying to understand a chapter on Collateral Debt Obligations (CDO).  

Sustained and sharpened by a glass of excellent malt whiskey, my brain was doing quite well digesting the information until my attention began to wander. The Eagles’ ‘Lyin’ Eyes’ was playing on the radio. My taste in music may not be sophisticated but I know a good tune when I hear it. A line from the song caught my attention, “She wonders how it ever got this crazy”. I reflected that a lot of people must have wondered after the crash how things had got that crazy and I realized I had only the haziest idea of what exactly Wall Street had been up to. No single book was going to cover such a vast topic so I set off with only my keyboard and a Google search box to find the answers. Anyway, I was tired of those damn CDO's.

The picture of the banks that emerged was one of a gigantic monster whose lust for the gluttonous accretion of wealth had reached a scale that rendered the word ‘greed’ wholly inadequate. For Hobbit fans, think Smaug deprived of his anti-psychotic medication and you get the general idea. I discovered malfeasance on a scale that beggared belief: a cynical disregard of legislation, regulation, and even common human decency. Banks had been gambling recklessly on mortgages but that was just the start. The biggest names on Wall Street were gaming almost every aspect of the global financial infrastructure from exchange rates to credit cards.

The next sentence will appear somewhat far-fetched but I assure you it's true. A few nights ago I was trying to understand a chapter on Collateral Debt Obligations (CDO).  

Sustained and sharpened by a glass of excellent malt whiskey, my brain was doing quite well digesting the information until my attention began to wander. The Eagles’ ‘Lyin’ Eyes’ was playing on the radio. My taste in music may not be sophisticated but I know a good tune when I hear it. A line from the song caught my attention, “She wonders how it ever got this crazy”. I reflected that a lot of people must have wondered after the crash how things had got that crazy and I realized I had only the haziest idea of what exactly Wall Street had been up to. No single book was going to cover such a vast topic so I set off with only my keyboard and a Google search box to find the answers. Anyway, I was tired of those damn CDO's.

The picture of the banks that emerged was one of a gigantic monster whose lust for the gluttonous accretion of wealth had reached a scale that rendered the word ‘greed’ wholly inadequate. For Hobbit fans, think Smaug deprived of his anti-psychotic medication and you get the general idea. I discovered malfeasance on a scale that beggared belief: a cynical disregard of legislation, regulation, and even common human decency. Banks had been gambling recklessly on mortgages but that was just the start. The biggest names on Wall Street were gaming almost every aspect of the global financial infrastructure from exchange rates to credit cards.

My Google searches kept throwing up stories of banks being fined for this and for that and it was hard to keep track of who did what, when. Luckily, I discovered a great site www.dividend.com which caught my attention with an article entitled, 'JP Morgan's Fines To Date: A Brief History”. It's a bit worrying when the word 'history' is applied to a respected financial institution in relation to its involvement in shonky practices. However the good news is that J.P didn't admit any guilt, they just paid the fines. So that's all right then - no harm done eh? 

The list of of activities for which they were fined comprised: misleading CDO investments, anticompetitive conduct, foreclosure abuse, mortgage misrepresentation, improper foreclosure, manipulating energy prices, illegal credit card practices, fraud by London traders, illegal activities relating to Fanny and Freddie, violations relating to institutional mortgage securities, misleading investors, rigging LIBOR rates, involvement in the Madoff affair and currency manipulation. 

That, by the way, was just a ‘brief’ history. There’s a lot more. All in all, JPMorgan paid over $35 billion in fines. These fines amounted to $5 billion more than New Zealand spent on social security, welfare and health in 2014. Put another way, that’s enough to make 128 more hobbit movies. What a waste!

I had no real idea of the specifics behind these headlines about billion dollar fines. Then I got lucky. My search threw up a press release from the Securities and Exchange Commission (SEC) concerning a case brought against Citigroup for selling a worthless collateralized debt obligation (CDO). The SEC didn’t call it worthless. They let Citigroup traders do the describing: 

'One experienced CDO trader characterized the Class V III portfolio in an e-mail as “dogshit” and “possibly the best short EVER!” An experienced collateral manager commented that “the portfolio is horrible".'

 For a trader to waste time and effort capitalising a word when they could be making another million or so shows you just how excited he or she was about this portfolio. True to the trader’s word, the CDO did indeed turn out to be ‘dogshit’ despite being described in a marketing brochure as 'an attractive investment rigorously selected by an independent investment adviser.' The next sentence "Seriously? - No I'm joking, it's a crock" were either redacted or never there in the first place. 

Back to the carefully crafted words of the SEC:

'The approximately 15 investors in the Class V III transaction lost virtually their entire investments while Citigroup received fees of approximately $34 million for structuring and marketing the transaction and additionally realized net profits of at least $126 million from its short position.'

I have to admit that at this point I was hooked. Here was a global bank that made over $150 million from ‘dogshit’ and then bet against its own customers that their carefully polished, shiny new purchase would quickly disappear down the toilet in the way that shit often does. Why has Peter Jackson not made a film about these guys? Wall Street made Mordor look like Sesame Street. At this point I began to wonder if perhaps I was falling prey to an easy stereotype that Wall Street were the bad guys in all of this. Just as Orcs are pretty rare in New Zealand, maybe rotten banks are rare in America.

 I knew how to settle this. I typed the phrase, 'Bank fined for...' into my search engine and watched the results spew out like jackpot coins from a slot machine in Vegas. Google found over 33 million results on this search term so I decided to save some time and concentrate on just the first few pages. Citigroup, the bank that likes to sell ‘dogshit’, seemed to pop up with surprising regularity. Maybe it was worth a closer look?

 Forget JPMorgan, these guys were in a class of their own. They had a rap sheet going back to at least 1981 when they paid $500,000 to settle a suit that the bank violated New York State laws on usury. That was small change compared to the $1.6 billion to settle lawsuits connected to Enron and $2.65 billion to settle with Worldcom investors. But there was more! In 2004, Japanese regulators shut down Citi’s private banking operations because of serious violations of Japan's banking laws. The New York Times reported:

Two years later it looked like they had put their house in order when Citigroup’s CEO, Charles O. Prince III said:

 'Our job is to set a tone at the top to incent people to do the right thing... And it is working. It is working.'

 Notice how he said it twice, as if to reassure himself. Unfortunately, it wasn’t working. Citigroup paid a $7 billion dollar fine after the 2008 melt down for selling shoddy mortgages, presumably sold by those employees who weren’t paying attention to the 'tone at the top'. Or perhaps they hadn't been on the receiving end of enough 'incent'.

The question that kept running round my head was, 'How could they possibly get away with doing this sort of thing year, after year, after year?' We’re talking thirty years. Could the banks just do what they pleased, pay fines when they were caught, and continue their illegal activities? When you looked at the fines against the bottom lines of these companies you had to conclude that the penalties were little more than a cost of doing business. To make matters worse, the banks can claim back much of their settlement costs against tax liabilities. Newsweek estimated; 'Windfall tax deductions set against the civil settlements imposed by the Justice Department total more than $44 billion."

That got me wondering about what the legislators were doing to put a stop to all the mayhem. I knew that the Dodd-Frank Act had been a response to the worst excesses of the financial industry, but that was back in 2010. What was happening now?  A New York Times article from May 2013 reported on a bill that had come before the House Financial Services Committee to amend provisions of the Dodd-Frank Act. That’s good, I thought. They’re trying to make it even stronger. Apparently not.

According to The New York Times, 'Citigroup’s recommendations were reflected in more than 70 lines of the House committee’s 85-line bill.’ I made a wild guess that Citibank’s 70 lines were not arguing for stricter controls.

 Now you can see where I was going with the whole Gettysburg thing. It didn’t seem possible to me that Congress, representing the democratic will of the American people, could possibly allow something like this to happen. I’d read all about lobbying in the US legislative process but this was something different. This looked like a blatant and powerful message from Wall Street: 'We can write our own laws.' Congress was being asked to pass a law written by the banks to further their own interests. It was like Gollum being elected mayor of Hobbiton.

 When I read that Congress obediently passed the law with no amendments five months later I realised that something really serious had gone awry since Gettysburg. There’s no way I could imagine Lincoln presiding over a democracy where a bank that had been fined for laundering money, paid billions in fines for illegal activities and proudly boasted about selling 'dogshit' would be allowed within a mile of the Capitol building. Now it looked like the banks were leading Congress by the nose. But how could they do this, I wondered? As I read further down the New York Times article, one possibility emerged.

Could the answer lie in a single word, money? Was it possible that lawmakers were allowing financial contributions to influence legislation? That didn’t sound to me like government by the people, for the people.

 To be honest, I felt disillusioned. When I was growing up I envied people who lived in America, the country that sent men to the moon and produced voices like Janis Joplin.  What I had uncovered made me feel like Dorothy in The Wizard of Oz when she sees that it isn’t the wizard pulling all the levers but just a little man behind a curtain. Except this was no little man. It was the big swinging dicks of Wall Street who had come in their corporate jets to tell Congress exactly which levers they wanted pulled.  If you want to know how that went, have a look at what happened in December 2014. 

An omnibus spending bill was voted through Congress containing a provision that repealed the prohibition against federal government bailouts of swaps entities.

No, I didn't really understand that sentence either.