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Corruption is everywhere in business, but it's selectively enforced. No finance execs went to jail for the financial crisis.(0) Perhaps the most frustrating th

Corruption is everywhere in business, but it's selectively enforced. No finance execs went to jail for the financial crisis.(0) Perhaps the most frustrating thing about the current political climate is that while fighting corruption headlined presidential campaigns of the long-ago past, it never headlines them today even though almost all of our country's problems are direct results of corruption. Jobs is a headline issue, but corporate corruption is endless. The financial sector has not been punished, in fact, Goldman Sachs has an influential post in Trump's cabinet(1). The auto industry was awarded bail outs for its corruption. This list goes on forever. Healthcare could not be fixed, despite the desires of a popular President that wanted to make it his trademark legislation, because of corruption. We have spent trillions on the War on Poverty, but it's hard to say Americans have much of a social safety net. The War on Drugs has created endless misery and violence, while the journalist who accurately exposed CIA drug running somehow suicided by two gunshot wounds to the head. We have endless wars, police murdering people without punishment, unconstitutional three letter agencies, and useless government bureaucracies. All the while growing socieconomic inequality. As developers, we are builders, and so it is in our self interest, and not just moral interest, to fight corruption. And personally, I'd much rather live in a world ruled by innovators and builders than by thugs and thieves. But every election cycle it feels like there is a divide and conquer to distract us from threatening the plutocracy. Goldman and Wall St win every time. The military wins every time. Healthcare finance execs win every time, etc... 0- https://www.bloomberg.com/view/articles/2017-07-26/why-no-one-went-to-jail-in-the-financial-crisis https://www.bloomberg.com/view/articles/2017-07-26/why-no-on... 1-https://theintercept.com/2016/12/09/trump-makes-america-goldmans-again-maga/ https://theintercept.com/2016/12/09/trump-makes-america-gold... 2-https://en.m.wikipedia.org/wiki/Gary_Webb https://en.m.wikipedia.org/wiki/Gary_Webb

matt4077 9y ago
It must be said that corruption of the sort alleged at Airbus has become rather rare. The US' Foreign Corrupt Practices Act[0] has, for example, done wonders. The US had decided that it wouldn't allow its domestic companies to bribe foreign officials. And because they were (legitimately) afraid of losing business to countries with lax standards, they expanded its power to foreign companies. Until the late 90s, for example, most European countries allowed the tax deduction of foreign bribes. Yeah, it wasn't just legal, but tax-supported. That changed dramatically with the FCPA, and actions such as Airbus' are now the exception rather than the norm. It's similar in politics, where I think people vastly overestimate the number of money-filled suitcases changing hands. The problem today is a different form of political corruption, namely that which has been legalised by Citizens United. [0] https://en.wikipedia.org/wiki/Foreign_Corrupt_Practices_Act https://en.wikipedia.org/wiki/Foreign_Corrupt_Practices_Act
- wallace_f 9y ago
  >The US' Foreign Corrupt Practices Act[0] has, for example, done wonders >Until the late 90s, for example, most European countries allowed the tax deduction of foreign bribes Very fair points However, what I would say is that without perverse incentives, the only thing between humanity and solving all of these problems, is incompetence. I think that for the most part, these people do know what they're doing. Also, you are right only so far that ostensibly this sort of corruption is rare. You don't hear about the people who were not caught. Just look at what is coming out of hollywood, and how long that took to come out, and yes there were figurative brief cases filled with money, one of them even discovered(1). 1-www.vulture.com/2017/10/harvey-weinstein-lawyer-david-boies-money-to-da-after-dropped-assault-case.html
- charlesdm 9y ago
  Not sure I believe that, but it might have. It seems these companies are mostly using middle men now, for example, see Unaoil: https://en.wikipedia.org/wiki/Unaoil https://en.wikipedia.org/wiki/Unaoil. I'm not pro corruption, but I'm also aware that in many parts of the world, if you want to operate in a certain market, there will always be a need for some "greasing of the wheels". I would assume that, as a country develops and grows, the amount of corruption will generally naturally decline.
  - coupdetaco 9y ago
    Greasing of wheels is actually permitted for ordinary affairs
    - charlesdm 9y ago
      Under US law? So you can bribe someone to get a construction or operating permit, but not to acquire a $100m property development project? That's a bit hypocritical no?
      - shub 9y ago
        Iit's specifically minor bribes required to get anything done even if you comply with the law. Bribing a building inspector to overlook safety problems, that's an FCPA violation. Tipping him $20 to thank him for his hard work on verifying your construction's code compliance, not a problem. The text is so: > Subsections (a) and (g) of this section shall not apply to any facilitating or expediting payment to a foreign official, political party, or party official the purpose of which is to expedite or to secure the performance of a routine governmental action by a foreign official, political party, or party official.
jokoon 9y ago
I view corruption as some kind of a necessary evil to protect and defend national interests. I mean you can't always allow corruption at a micro level because it would be inefficient, but it's always allowed at the higher level. I view corruption as a mean to keep the control of a social structure in the hands of certain interests so that it cannot be hijacked by strangers. https://www.youtube.com/watch?v=apM0d3M-sps https://www.youtube.com/watch?v=apM0d3M-sps Frankly, the mafia exists because some people don't trust the government or outside/remote political power to gain influence on them. So this way corruption allows people to take back things they think are owed to them. People call this corruption, but I think people can act in their own interest and as long as we consent to it, it's not corruption, it's just public consent. I mean there are countless ways that the public benefits from overseas corruption. For example nobody complains that gas is cheap enough. That's a form of corruption, to me. You call that corruption, I call that consent and a balance of self interest. As long as people are happy enough, everything is good.
- saimiam 9y ago
  This type of doublethink is what undermines confidence in the global order and rule of law. When some European/Western companies indulges in corruption and out-and-out egregious behavior, it's "just boys being boys" and "too big to fail." A Chinese company indulges in some industrial espionage or uses that country's diplomatic levers and suddenly the sky is falling down. E.g., why is Volkswagen still in business after literally setting fire to the world? Why should Airbus not be summarily be liquidated in found guilty of corruption? Back in the day, news of such corruption would percolate slowly into the rest of world. That is no longer the case. News spreads quickly. People (like me) are watching and hoping that the standards get applied equally and if they don't, I like to think the strength in numbers and youth lies in the East, not the West.
  - deleted 9y ago
    [deleted]
  - nerdponx 9y ago
    FWIW this phenomenon has been happening since before the dawn of industrialization. If anything it's probably less of a problem in 2017 than it's ever been. That doesn't mean we should stop treating it like a problem. It just means we should look back on our sordid history as a species and take that as encouragement that we can keep improving. And it starts with awareness. Who today talks about the BP oil and Exxon Valdez oil spills, or Love Canal, or Enron†? †Execs only got prosecuted and convicted here because more powerful people lost money because of them.
samstave 9y ago
I agree with everything you say, however I am pessimistic on your view of builders; look at those who are "builders" and have money and political ambitions: thiel and zuck for example. Corrupt as hell. Sure they have built stuff but I wouldn't trust them. Heck at this point the only builders I think we could trust would be musk and gates...
- astrobe_ 9y ago
  Plus, this article ( https://www.theguardian.com/technology/2017/oct/05/smartphone-addiction-silicon-valley-dystopia https://www.theguardian.com/technology/2017/oct/05/smartphon... ) was on top of HN last week; innovators and builders feeling guilt about what they have made, even though it was all good intentions.
  - radiorental 9y ago
    Power corrupts; absolute power corrupts absolutely
- wallace_f 9y ago
  zuck obviously has never been one to carry a moral compass, but what's so bad about Thiel? Anyways, the problem with politicians is their ability to get themselves elected already disqualifies them from the job. At least doctors, engineers, and scientists from the hard sciences seem to have to show some kind of positive merit, even if they're still not a perfect lot.
marcoperaza 9y ago
You keep conflating corruption with views different than your own.
peoplewindow 9y ago
Goldman Sachs has never been accused of paying bribes. The worst it got for them during the crisis was the accusation that it misled investors and profited from the crash in the mortgage market. But that's (a) not the same thing as paying bribes and (b) not a well defined accusation to begin with (Goldman claimed its customers were aware of its bets against the mortgage market but its customers still get to pick what they invest in).
- wallace_f 9y ago
  >Goldman Sachs has never been accused of paying bribes In fact, they have(0). But winners getting away with it happens all the time. Winners sometimes win on merit, sometimes by rule, and sometimes simply because they don't get caught. I would argue Wall St is mostly the last two. During WWII Curtis LeMay was distraught with his position as leader of the firebombings of innocents in Tokyo. He said "if we lose the war, I will be tried and executed as a war criminal." It's the same thing here. No one has been indicted for in the financial crisis. No one for Iraq WMD lies, either. The ruling class go to great lengths to not let thenselves be tried as criminals. It doesn't mean they're not owning you. Case in point: Reasonable people have put the cost of the financial crisis at 6-30 trillion, or more (6 being the lower bound of the Fed's very own estimate). The higher figure is $93,000/per citizen, and it very will could be more than that.(1) After this, any sane person would have overhauled Wall St, but no one did. We will see big shake ups in Airbus, but not Wall St. So the corruption in Wall St is either legal, or people don't have enough power to indict them. 0 - https://www.theguardian.com/business/2016/jun/13/goldman-sachs-hired-prostitutes-to-win-libyan-business-court-told https://www.theguardian.com/business/2016/jun/13/goldman-sac... 1 - https://www.cnbc.com/id/101022718 https://www.cnbc.com/id/101022718
  - marcoperaza 9y ago
    This is frankly a non-response. You're defining corruption as "things I don't like". If you're going to argue that someone is corrupt, you need to be specific as to what you're accusing them of, and how that fits into a theory of corruption. Your "case in point" points out the obvious: that people lost a lot of money in a market crash and economic downturn. But market crashes don't require any wrongdoing. In this case there is in fact evidence that some people were criminally dishonest. Some mortgage brokers who were complicit in applicants' lies, for example. But it's not readily apparent that investment banks did anything wrong, other than make bad decisions for themselves and their customers.
matwood 9y ago
> The financial sector has not been punished, in fact, Goldman Sachs has an influential post in Trump's cabinet(1). Not defending Trump, but GS current and ex-employees have held high level positions in every administration for years. I'm sure GS employees are likely some of the best in their field, but it does leave one wondering when hard decisions get made will they do what is in the best interest of the country even if it is somehow detrimental to GS. With that said, I hope that when Trump leaves office that people still pay this much attention to what is happening in the government. No matter what your personal views are, holding government accountable is key to a good functioning government.
- r00fus 9y ago
  Dunno about wallace_f but I was critical of Obama putting Geithner as Secretary of Treasury, despite my support for Obama himself. The corruptive influence of corporations and the wealthy extend beyond parties. However, individuals in a party can still fight corruption.
  - matwood 9y ago
    HN typically lets critical thought rule, which is one of the main reasons I post here. Although it is not perfect, HN is still one of the best online places to have nuanced discussions. The problem is that the public at large seems to ignore many issues as long as their person is the one in charge.
    - dmix 9y ago
      > The problem is that the public at large seems to ignore many issues as long as their person is the one in charge. Could this ultimately mean that corruption will be a natural side effect of extensive government power? A vigilant press/populace would be useful and may be what's missing today... but in these niche industries the mega-corporations are still the one with the deepest pockets and the most motivation as they have the most to win/lose. I'm not trying to make this ideological and anti-government, it's just an interesting thought to consider, that it's possible the only power that can't be exploit is either one severely limited and inherently closely (which may defeat the utility of such a power) or having not power at all.
pasbesoin 9y ago
If financial executives had been investigated and prosecuted to the fullest extent, it might have sent a much needed message -- and beyond just the financial sector itself. White collar, "banker's stripes" crime has too little attendant risk, and what risk does exist, is too often a financial risk that is dwarfed by the profits and furthermore paid by the institution rather than the individual. Imagine if you could rob a bank, and when caught, pay 5 or 10% of what you gained and walk away. Bank robbery would be a growth sector.
bogomipz 9y ago
>"As developers, we are builders, and so it is in our self interest, and not just moral interest, to fight corruption. And personally, I'd much rather live in a world ruled by innovators and builders than by thugs and thieves." Fighting corruption is in society's best interest period. It's no more important to one specific profession than it is another. That's really an odd thing to say. Also you realize that Wall Street Banks and Aerospace companies either are or were innovators and builders and thats how they got to where they are correct? Also the technology sector is no way impervious to corruption.
- wallace_f 9y ago
  I wonder how much value modern financial innovations actually add to the economy. Certainly CDSs, CMOs and others haven't added any. By the way I'm fine with financial firms that risk their own money. Global banking empires risking other people's money and insured by the American citizen have proven to take more from the economy than they add though. Without the Fed pumping them full of easy money, and with Glass Steagall, they wouldn't even exist. And yes, power corrupts no matter which industry you come from, but at least in engineering, science, medicine, or even sports, etc there is ostensibly some kind of respectable merit required in success. Just look at the richest tech moguls in the world, and it's clear what they contributed. What exactly did the richest financiers like Jeffrey Epstein, Jamie Dimon, or George Soros contribute? It's hard to put a finger on it. If anything it appears they profit off of others demise.
  - bogomipz 9y ago
    >"I wonder how much value modern financial innovations actually add to the economy." Money market funds and mutual funds are innovations which have helped people save for retirement. Venture Capital funds have enabled many tech companies to flourish. The Commercial paper market has made payroll at large corporation much more efficient. Securitization of debt although it can obviously be abused is what allows people to get financing to buy homes and get car loans. These were all innovations. I am no defender of the banking industry but to say that there hasn't been value added by any of these innovation seems pretty silly.

matt4077 9y ago

It must be said that corruption of the sort alleged at Airbus has become rather rare. The US' Foreign Corrupt Practices Act[0] has, for example, done wonders. The US had decided that it wouldn't allow its domestic companies to bribe foreign officials. And because they were (legitimately) afraid of losing business to countries with lax standards, they expanded its power to foreign companies. Until the late 90s, for example, most European countries allowed the tax deduction of foreign bribes. Yeah, it wasn't just legal, but tax-supported. That changed dramatically with the FCPA, and actions such as Airbus' are now the exception rather than the norm. It's similar in politics, where I think people vastly overestimate the number of money-filled suitcases changing hands. The problem today is a different form of political corruption, namely that which has been legalised by Citizens United. [0] https://en.wikipedia.org/wiki/Foreign_Corrupt_Practices_Act https://en.wikipedia.org/wiki/Foreign_Corrupt_Practices_Act

wallace_f 9y ago
>The US' Foreign Corrupt Practices Act[0] has, for example, done wonders >Until the late 90s, for example, most European countries allowed the tax deduction of foreign bribes Very fair points However, what I would say is that without perverse incentives, the only thing between humanity and solving all of these problems, is incompetence. I think that for the most part, these people do know what they're doing. Also, you are right only so far that ostensibly this sort of corruption is rare. You don't hear about the people who were not caught. Just look at what is coming out of hollywood, and how long that took to come out, and yes there were figurative brief cases filled with money, one of them even discovered(1). 1-www.vulture.com/2017/10/harvey-weinstein-lawyer-david-boies-money-to-da-after-dropped-assault-case.html
charlesdm 9y ago
Not sure I believe that, but it might have. It seems these companies are mostly using middle men now, for example, see Unaoil: https://en.wikipedia.org/wiki/Unaoil https://en.wikipedia.org/wiki/Unaoil. I'm not pro corruption, but I'm also aware that in many parts of the world, if you want to operate in a certain market, there will always be a need for some "greasing of the wheels". I would assume that, as a country develops and grows, the amount of corruption will generally naturally decline.
- coupdetaco 9y ago
  Greasing of wheels is actually permitted for ordinary affairs
  - charlesdm 9y ago
    Under US law? So you can bribe someone to get a construction or operating permit, but not to acquire a $100m property development project? That's a bit hypocritical no?
    - shub 9y ago
      Iit's specifically minor bribes required to get anything done even if you comply with the law. Bribing a building inspector to overlook safety problems, that's an FCPA violation. Tipping him $20 to thank him for his hard work on verifying your construction's code compliance, not a problem. The text is so: > Subsections (a) and (g) of this section shall not apply to any facilitating or expediting payment to a foreign official, political party, or party official the purpose of which is to expedite or to secure the performance of a routine governmental action by a foreign official, political party, or party official.

jokoon 9y ago

I view corruption as some kind of a necessary evil to protect and defend national interests. I mean you can't always allow corruption at a micro level because it would be inefficient, but it's always allowed at the higher level. I view corruption as a mean to keep the control of a social structure in the hands of certain interests so that it cannot be hijacked by strangers. https://www.youtube.com/watch?v=apM0d3M-sps https://www.youtube.com/watch?v=apM0d3M-sps Frankly, the mafia exists because some people don't trust the government or outside/remote political power to gain influence on them. So this way corruption allows people to take back things they think are owed to them. People call this corruption, but I think people can act in their own interest and as long as we consent to it, it's not corruption, it's just public consent. I mean there are countless ways that the public benefits from overseas corruption. For example nobody complains that gas is cheap enough. That's a form of corruption, to me. You call that corruption, I call that consent and a balance of self interest. As long as people are happy enough, everything is good.

saimiam 9y ago
This type of doublethink is what undermines confidence in the global order and rule of law. When some European/Western companies indulges in corruption and out-and-out egregious behavior, it's "just boys being boys" and "too big to fail." A Chinese company indulges in some industrial espionage or uses that country's diplomatic levers and suddenly the sky is falling down. E.g., why is Volkswagen still in business after literally setting fire to the world? Why should Airbus not be summarily be liquidated in found guilty of corruption? Back in the day, news of such corruption would percolate slowly into the rest of world. That is no longer the case. News spreads quickly. People (like me) are watching and hoping that the standards get applied equally and if they don't, I like to think the strength in numbers and youth lies in the East, not the West.
- deleted 9y ago
  [deleted]
- nerdponx 9y ago
  FWIW this phenomenon has been happening since before the dawn of industrialization. If anything it's probably less of a problem in 2017 than it's ever been. That doesn't mean we should stop treating it like a problem. It just means we should look back on our sordid history as a species and take that as encouragement that we can keep improving. And it starts with awareness. Who today talks about the BP oil and Exxon Valdez oil spills, or Love Canal, or Enron†? †Execs only got prosecuted and convicted here because more powerful people lost money because of them.

samstave 9y ago

I agree with everything you say, however I am pessimistic on your view of builders; look at those who are "builders" and have money and political ambitions: thiel and zuck for example. Corrupt as hell. Sure they have built stuff but I wouldn't trust them. Heck at this point the only builders I think we could trust would be musk and gates...

astrobe_ 9y ago
Plus, this article ( https://www.theguardian.com/technology/2017/oct/05/smartphone-addiction-silicon-valley-dystopia https://www.theguardian.com/technology/2017/oct/05/smartphon... ) was on top of HN last week; innovators and builders feeling guilt about what they have made, even though it was all good intentions.
- radiorental 9y ago
  Power corrupts; absolute power corrupts absolutely
wallace_f 9y ago
zuck obviously has never been one to carry a moral compass, but what's so bad about Thiel? Anyways, the problem with politicians is their ability to get themselves elected already disqualifies them from the job. At least doctors, engineers, and scientists from the hard sciences seem to have to show some kind of positive merit, even if they're still not a perfect lot.

marcoperaza 9y ago

You keep conflating corruption with views different than your own.

peoplewindow 9y ago

Goldman Sachs has never been accused of paying bribes. The worst it got for them during the crisis was the accusation that it misled investors and profited from the crash in the mortgage market. But that's (a) not the same thing as paying bribes and (b) not a well defined accusation to begin with (Goldman claimed its customers were aware of its bets against the mortgage market but its customers still get to pick what they invest in).

wallace_f 9y ago
>Goldman Sachs has never been accused of paying bribes In fact, they have(0). But winners getting away with it happens all the time. Winners sometimes win on merit, sometimes by rule, and sometimes simply because they don't get caught. I would argue Wall St is mostly the last two. During WWII Curtis LeMay was distraught with his position as leader of the firebombings of innocents in Tokyo. He said "if we lose the war, I will be tried and executed as a war criminal." It's the same thing here. No one has been indicted for in the financial crisis. No one for Iraq WMD lies, either. The ruling class go to great lengths to not let thenselves be tried as criminals. It doesn't mean they're not owning you. Case in point: Reasonable people have put the cost of the financial crisis at 6-30 trillion, or more (6 being the lower bound of the Fed's very own estimate). The higher figure is $93,000/per citizen, and it very will could be more than that.(1) After this, any sane person would have overhauled Wall St, but no one did. We will see big shake ups in Airbus, but not Wall St. So the corruption in Wall St is either legal, or people don't have enough power to indict them. 0 - https://www.theguardian.com/business/2016/jun/13/goldman-sachs-hired-prostitutes-to-win-libyan-business-court-told https://www.theguardian.com/business/2016/jun/13/goldman-sac... 1 - https://www.cnbc.com/id/101022718 https://www.cnbc.com/id/101022718
- marcoperaza 9y ago
  This is frankly a non-response. You're defining corruption as "things I don't like". If you're going to argue that someone is corrupt, you need to be specific as to what you're accusing them of, and how that fits into a theory of corruption. Your "case in point" points out the obvious: that people lost a lot of money in a market crash and economic downturn. But market crashes don't require any wrongdoing. In this case there is in fact evidence that some people were criminally dishonest. Some mortgage brokers who were complicit in applicants' lies, for example. But it's not readily apparent that investment banks did anything wrong, other than make bad decisions for themselves and their customers.

matwood 9y ago

> The financial sector has not been punished, in fact, Goldman Sachs has an influential post in Trump's cabinet(1). Not defending Trump, but GS current and ex-employees have held high level positions in every administration for years. I'm sure GS employees are likely some of the best in their field, but it does leave one wondering when hard decisions get made will they do what is in the best interest of the country even if it is somehow detrimental to GS. With that said, I hope that when Trump leaves office that people still pay this much attention to what is happening in the government. No matter what your personal views are, holding government accountable is key to a good functioning government.

r00fus 9y ago
Dunno about wallace_f but I was critical of Obama putting Geithner as Secretary of Treasury, despite my support for Obama himself. The corruptive influence of corporations and the wealthy extend beyond parties. However, individuals in a party can still fight corruption.
- matwood 9y ago
  HN typically lets critical thought rule, which is one of the main reasons I post here. Although it is not perfect, HN is still one of the best online places to have nuanced discussions. The problem is that the public at large seems to ignore many issues as long as their person is the one in charge.
  - dmix 9y ago
    > The problem is that the public at large seems to ignore many issues as long as their person is the one in charge. Could this ultimately mean that corruption will be a natural side effect of extensive government power? A vigilant press/populace would be useful and may be what's missing today... but in these niche industries the mega-corporations are still the one with the deepest pockets and the most motivation as they have the most to win/lose. I'm not trying to make this ideological and anti-government, it's just an interesting thought to consider, that it's possible the only power that can't be exploit is either one severely limited and inherently closely (which may defeat the utility of such a power) or having not power at all.

pasbesoin 9y ago

If financial executives had been investigated and prosecuted to the fullest extent, it might have sent a much needed message -- and beyond just the financial sector itself. White collar, "banker's stripes" crime has too little attendant risk, and what risk does exist, is too often a financial risk that is dwarfed by the profits and furthermore paid by the institution rather than the individual. Imagine if you could rob a bank, and when caught, pay 5 or 10% of what you gained and walk away. Bank robbery would be a growth sector.

bogomipz 9y ago

>"As developers, we are builders, and so it is in our self interest, and not just moral interest, to fight corruption. And personally, I'd much rather live in a world ruled by innovators and builders than by thugs and thieves." Fighting corruption is in society's best interest period. It's no more important to one specific profession than it is another. That's really an odd thing to say. Also you realize that Wall Street Banks and Aerospace companies either are or were innovators and builders and thats how they got to where they are correct? Also the technology sector is no way impervious to corruption.

wallace_f 9y ago
I wonder how much value modern financial innovations actually add to the economy. Certainly CDSs, CMOs and others haven't added any. By the way I'm fine with financial firms that risk their own money. Global banking empires risking other people's money and insured by the American citizen have proven to take more from the economy than they add though. Without the Fed pumping them full of easy money, and with Glass Steagall, they wouldn't even exist. And yes, power corrupts no matter which industry you come from, but at least in engineering, science, medicine, or even sports, etc there is ostensibly some kind of respectable merit required in success. Just look at the richest tech moguls in the world, and it's clear what they contributed. What exactly did the richest financiers like Jeffrey Epstein, Jamie Dimon, or George Soros contribute? It's hard to put a finger on it. If anything it appears they profit off of others demise.
- bogomipz 9y ago
  >"I wonder how much value modern financial innovations actually add to the economy." Money market funds and mutual funds are innovations which have helped people save for retirement. Venture Capital funds have enabled many tech companies to flourish. The Commercial paper market has made payroll at large corporation much more efficient. Securitization of debt although it can obviously be abused is what allows people to get financing to buy homes and get car loans. These were all innovations. I am no defender of the banking industry but to say that there hasn't been value added by any of these innovation seems pretty silly.