"American Casino: Meltdown on Wall Street, Main Street Abandoned"

"American Casino:
Meltdown on Wall Street, Main Street Abandoned"
By Stephen Holden

"The dire financial statistics paraded in the documentary “American Casino” are infuriating: $12 trillion pledged by the United States government to bail out Wall Street, $18.4 billion handed out in Wall Street bonuses last year, a final reckoning of $42,000 per capita to finance the rescue. But the most shocking images in this finger-pointing investigation of the subprime mortgage crisis are the shots of polluted swimming pools on abandoned properties in Southern California.

Read it again:$12 TRILLION to "rescue" the thieves of Wall Street; $18.4 BILLION in bonuses for Wall Street last year; $18.8 BILLION in bonuses THIS year for the Fine Patriots at Goldman Sachs alone- and THIS is what YOU get, Good Citizen:

Dire straits: A block of foreclosed row houses in Baltimore in a scene
from Leslie Cockburn’s documentary “American Casino.”

In Riverside County some homeowners forced into foreclosure have not only turned off their pool pumps, allowing mosquitoes to breed and multiply, but have also filled up the spaces with playground equipment and other random trash. Some have even driven vehicles into their pools. Why? As Jared Dever, a soft-spoken regional official who sprays the stagnant water with chemicals that kill the mosquito larvae, speculates, “It may be a selfish retaliation.”

These festering, junk-filled dumps are also sun-drenched petri dishes for rodent-spread disease. Some abandoned houses become meth labs and indoor marijuana farms. Aerial shots of decaying properties suggest an unfolding real-life version of a horror film in which an upheaval of squirming maggots threatens to overrun a suburban paradise.

“American Casino,” directed by Leslie Cockburn, who wrote and produced the documentary with her husband, the liberal journalist Andrew Cockburn, begins on Wall Street, where various whistle-blower types describe the climate of greed and carelessness that produced the financial meltdown. The documentary dates the origins of the crisis to the insertion of a provision in the 2000 Commodity Futures Modernization Act, introduced by Phil Gramm, the Texas Republican and former senator who was then chairman of the Senate Finance Committee, exempting credit-default swaps from government regulation.

Alan Greenspan, testifying before Congress last year, admits to discovering a “flaw in the model that I perceived is the critical functioning structure that defines how the world works.” In other words, his naïve belief that markets are self-regulating helped enable the crisis. In the words of Michael Greenberger, a director of trading and markets at the Commodity Futures Trading Commission during the Clinton years, this laissez-faire philosophy allowed Wall Street to “shoot itself in both feet.”

We meet Frank L. Raiter, a senior executive in charge of rating mortgage bonds at Standard & Poor’s who quit in disgust when ordered to guess the rating of billion-dollar subprime securities. Mr. Raiter recalls an internal e-mail message, in which a colleague crowed: “We rate every deal. It could be structured by cows, and we would rate it.” Another e-mail message voiced the hope that everyone is retired “by the time this house of cards falters.” If the tone sounds familiar, you’ve heard versions of the same swaggering contempt and indifference to consequences expressed in internal e-mail messages in “Enron: The Smartest Guys in the Room.”

A meticulously structured film, “American Casino” begins on Wall Street; moves to Main Street, focusing on a Baltimore neighborhood; then travels to Stockton, Calif.; and ends in Southern California. The Baltimore section is the toughest and most detailed. Here, the film asserts, investment bankers and mortgage lenders deliberately sold risky subprime mortgages, which they knew could never be repaid, to residents in minority neighborhoods. Hard-working, civic-minded African-Americans who lost their homes — including a high school teacher, a therapist and a preacher — tell wrenching personal stories.

In some cases deceptive salesmanship contributed to the losses. Borrowers were misled by contracts whose fine print even professionals had difficulty deciphering. To make a sale, additional fees were never mentioned until closing. In one of the most troubling assertions, a former executive for a now bankrupt mortgage company insists that “almost everyone in the industry” falsified borrowers’ incomes to meet the terms of loans. “Reverse redlining,” the practice of singling out minority borrowers to seek loans on unfavorable terms is “the civil rights issue of the 2000s,” declares John Belman, a civil rights lawyer.

“American Casino” does not leave you assured that the worst is over. The corrupted gambling den that Wall Street became in the last 15 years may be emptied of many of its players. But if financial stability is restored without strong regulation, operations are likely to resume as before. The lesson of this story: if enough money is involved, greed trumps morality."

"American Casino" opens on Wednesday in Manhattan.
- http://movies.nytimes.com/2009/09/02/movies/02american.html

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