The Obama White House continues to push for a settlement that would let bankers avoid being punished - or even investigated - for a wave of mortgage-related crimes that includes perjury, tax evasion, and several types of fraud.[1]

Despite the President's new-found populism - rhetorically, anyway - officials in his Administration continue to push an unfair deal designed to conceal the financial Crime of the Century.

The Financial Times reported on new details of the proposed settlement, whose stated purpose is to punish banks and reduce the amount of money owed by underwater homeowners. But it's increasingly clear that the deal wouldn't help homeowners very much and wouldn't punish bankers at all.

Banks could lower those loan balances by reducing the amount owed on mortgages owned by investors and not by the bank itself. That's what Bank of America is accused of doing as part of an $8 billion settlement it reached in 2008. This deal would set the stage for a repeat performance.

This proposed deal is still unfair, unjust, and very unbalanced. And it has the Administration's fingerprints all over it.

Unfair

Banks deceived investors into buying bundled mortgages (mortgage-backed securities) that they knew were worth far less than they were paying. Now, as part of this settlement deal, they could shaft those investors again. Many of the investors are from the 99 percent, not the one percent. As the head of the Association of Mortgage Investors told the Financial Times, "It would be a pyrrhic victory to settle the mortgage crisis with the money of public institutions, pension funds and seniors."

The proposed deal would force banks to meet a certain dollar limit for reducing mortgage principal. But it's designed to let them use other people's money - mortgage investors' money - to reach that limit. They would have to reduce principals by a larger amount if they were using someone else's money.

Taking $1.00 off their own books might get them $1.00 closer to their goal, while using investors' money money only "earn" them fifty cents. Is that really supposed to encourage them to do the right thing?

Ask yourself: What if you were given a choice between spending a thousand dollars of your own money to pay a fine - or two thousand dollars of someone else's? (And remember: You're a banker, so don't let conscience influence your decision.) What would you do?

The money should come out of the banks' balance sheets, not those of mortgage investors that in many cases they've already defrauded. Even that isn't entirely fair: Many pension funds and other institutional investors hold bank stock, too, as do unwary private investors. They've also been defrauded by bank executives. But someone has to pay the price for trusting these bankers and tolerating their continued presence in the executive suite.

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From the aptly named Doctor Zero at Hot Air:

Radio and television host Glenn Beck finds himself confronting an advertiser boycott, organized by people who don’t watch his show anyway. The primary effect of the boycott will be denying advertisers like Best Buy, CVS, and Travelocity access to Beck’s immense and rapidly growing audience. (By the way, one of the participating advertisers is GMAC. Don’t we taxpayers own five or six billion dollars worth of GMAC? Something tells me the boycott supporters include a far larger percentage of people who don’t pay any federal income tax than Beck’s audience does. GMAC should require permission from actual taxpayers before it’s allowed to engage in a silly boycott that could damage its profitability, and devalue our five billion dollar investment.)

Oh, but Doctor Zero isn't finished frothing. Obama is just as bad as people who attended KKK rallies because he attended Jeremiah Wright's church:

Perhaps we could defuse the tension by asking the boycott organizers if they think someone who sat quietly at Klan rallies for twenty years could credibly be accused of racism. I’m sure they would say “no”… and since that’s an accurate analogy for Obama’s decades at Jeremiah Wright’s Church of Racial Hatred, Beck would doubtless be moved to offer a polite apology, and we could call the boycott off...

Oh yeah, and one more thing -- Obama has never said or written anything nice about white people, and the good Doctor challenges you to find where he has:

The rest of Beck’s comment, asserting that Obama has “deep-seated hatred for white people of the white culture,” should be easy for the President’s defenders to disprove. All they have to do is cite one positive thing Obama has said or written about white culture. Anywhere. Ever. Hopefully they can get back to us before GMAC needs another taxpayer bailout, to address the self-inflicted financial damage from its participation in the boycott. I wouldn’t recommend wasting any time going through Obama’s university compositions, assuming you can find where they’re buried, and get past the three-headed guard dog... Read on...

Get it? The boycott is nonsense because President Obama really IS a racist and Glenn Beck is just speaking the truth!