why the blagojevich indictment is way more important than the madoff ponzi scheme

Posted in Uncategorized by Ryan Locke on December 23, 2008

Watching news coverage of the Madoff Ponzi scheme, you would think Madoff trolled Florida for old Jewish grandmothers to rob, flipping them over and shaking them until $50 billion spilled out onto the sidewalk.  Meanwhile, the Blagojevich indictment has taken a backseat — there haven’t really been any articles on the huge consequences of Blagojevich’s corruption.  The lack of coverage is not because the Ponzi scheme is more important — it isn’t.  The real reason is because the Ponzi scheme created victims that make for great TV, while the victims of the Blagojevich corruption — citizens, Governors, and the US government in general — don’t.

The Madoff Ponzi scheme has been blown out of proportion.  I’m not talking about the monetary loss, which is likely to multiply in the coming months.  I’m talking about coverage.

Many journalists are approaching the scandal like it’s a new breed of Ponzi scheme.  In some ways, it is.  Never before have we seen a Ponzi scheme span internationally, con so many rich and knowledgable people into participating, or be perpetrated so long.  Because the con was so brazenly structured like a legitimate business, the media would have you believe — and the victims strenuously assert — that this is a new breed of Ponzi con that could have swindled anyone…even you!

This simply isn’t the case.  The Ponzi scheme here is timeless: it was a fraud perpetrated against greedy dopes with money.  Let’s get real here.  When the victims realized that they could earn steady money by investing through Madoff’s exclusive deals, they ate like pigs at a trough.  Some victims invested all of their savings through Madoff.  Is that the behavior of a rational investor who just happened to get burned by a duplicitous broker?  No.  That’s the behavior of a greedy dupe who salivated at the chance to earn easy money.

I feel sorry for the victims, sure; it’s not like I wanted them to lose all their money.  But are these people distinguishable from other people who do stupid things and suffer the consequences?  Should we feel more sorry for the Madoff victims than we should for victims who signed up for a larger mortgage than they could afford, or victims of payday lending, or victims of large medical bills because they’ve never carried health insurance, or victims of low-paying jobs because the jobs are, well, low-paying?  At some point, you’re not really a victim — you’re on the receiving end of a consequence.

The Madoff victims are rich, white, old and articulate.  That makes them the best possible TV victims if we ignore that they essentially gambled their money and lost.

The Blagojevich indictment, on the other hand, is a super-important story that we should be hearing about constantly.  Usually I’m careful to use allegedly when talking about criminal charges (defense habits die hard).  But here, I think we can all agree that Blagojevich is screwed.  There’s all this evidence on the wiretap and we haven’t even hit a grand jury! Usually the government will get wind of illegal activity, convene a grand jury and get enough juicy evidence to indict.  For Blagojevich it’s like, we’re at the steakhouse and we’ve just now finished the rolls.  Bring on the meat!  It’s pretty clear that Blagojevich is way crooked. 

In my opinion, political corruption is one of the most serious crimes you can commit because it has the most serious consequences of almost any crime. In my little value system, it’s up there with treason and murder.  Here’s why:

  1. One politician’s corruption erodes the public trust in all politicians.  How many Illinois citizens will second-guess the next governor’s integrity?  A better question: how many more Illinois governors will it take to convince the other states that Illinois is no longer corrupt?
  2. When a politician corrupts politics, he shows the system doesn’t work and discourages other people from participating in the system.  I mean, why play the game if you know the other team doesn’t have to follow the rules?  It’s already an uphill battle to convince citizens that politics can work for them, particularly marginalized citizens.  Why does Blagojevich teach them?
  3. A politician’s corruption frustrates our diplomatic efforts abroad.  We’re fighting to support democracy and freedom worldwide.  What is a young Afghan boy to think when he reads that American democracy can be bought and sold?  Why should African countries honor our calls for fair and impartial election processes when we’re subject to the same corruption?

I haven’t heard any mention of these consequences in the media.  These are the kinds of things that we should be talking about, not weeping because some guy in Florida gambled all his savings and now has to sell his dream house.


2 Responses

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  1. coffee fiend said, on January 7, 2009 at 3:52 pm

    it’s interesting how Blagojevich seems so unaffected by all the chaos swirling around him; it’s as if he feels right at home…

  2. ryanlocke said, on January 7, 2009 at 11:38 pm

    coffee fiend,

    It always surprises me when politicians get hit with a scandal and then maintain their innocence when it’s pretty clear they’ve done it. Like, why not just say you’re sorry now and everyone will forget about it in a year.

    I was watching news coverage of when Blagojevich made a statement and he said something like “all I’m doing is putting Illinois first — is that a crime?” I think he saw this shady quasi-bargaining as a means to an end. He was going to really help Illinois by appointing a good senator and make a little bit of money on the side.

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