One of the biggest political myths that too many people still believe is that big business (banks in particular) supports conservative principles and/or conservative parties.

Nonsense. Big business supports big business, and not much else. If their quarterly earning reports show a benefit selling rope to the Obama Administration for the purposes of being hung by same, they will sell it, and if they can purchase legislation to protect them from foreign competition, they will.

Banks, populated by Ivy League who rise through connections more than intellect, are merely the worst of the lot.

Robert Rubin: the Nexus of Big Government and Wall Street

Rubin, of course, is largely gone from the public scene after spending 10 disastrous years as a board member and senior executive at Citigroup, the banking giant that epitomizes all that is wrong with American finance, and before that, a largely successful run as Treasury Secretary in the Clinton Administration, which he joined after running another controversial bank, Goldman Sachs. But his legacy looms large, mainly because I believe he was one of the reasons why the financial crisis occurred in the first place.

Citigroup, with nearly $1 trillion in customer deposits, is and always was Too Big To Fail, meaning that because of its size and scope, and the fact that it safe keeps FDIC insured customer deposits, the Federal government wouldn’t just let the bank implode as it did Lehman Brothers.

Too many people would be hurt, and not just the Wall Street types. That’s why during the height of the financial crisis, policy makers in both parties threw hundreds of billions of dollars at Citigroup to save it from going bust.

Despite all of this, as I show in my new book about the financial crisis, The Sellout, Rubin advocated policies at Citigroup that put the massive bank in jeopardy, and with that put the entire financial system in peril. He was one of the strongest supporters for the bank to begin taking more risk through bond trading, which ultimately led to the firm’s downfall, and its government bailout. He had a seat on the Citigroup board, but from that vantage point, he never saw how the firm’s risk profile was growing out of control. He was a senior executive at the firm with the lofty title of “Chairman of the Executive Committee,” and yet he has time and again explained to me that he had “no operating responsibilities” to monitor the bad behavior that got the firm in trouble in the first place.

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There are plenty of media types who blame last years implosion and the bailout on greedy bankers, but that’s only part of the story. Wall Street needed a co conspirator, and for me, that co-conspirator is Big Government. They are an odd couple; the ultimate free marketers teaming up with the bureaucrats. But as I show in The Sellout, the relationship worked, at least for them.

As for the rest of us, we’re still paying the price.