The frothing radical right thinks the New York Times is the frothing radical left, as if such a thing exists in this country in this day, but this is a newspaper that doesn’t speak truth to power even when the power is itself, even after the lights are out, even in the sound-proofed panic room where it can’t be overheard. So it’s something of a shock to find what amounts to a rant from long-time Wall Street watcher and Times business bigwig Gretchen Morgenson on the subject of the inequities inherent in bailing out banks but not their victims.

One doesn’t often find ranting in the Times outside the occasional Bill Kristol column, and his stuff doesn’t really qualify because, much like a water spider skittering across a pond, he’s such a lightweight as to never break the surface tension of reality long enough to make an impression on it. But when Morgenson, who both thinks and writes better than Kristol, starts a story off by flatly stating that fallout from the housing bubble “has exposed and worsened a dangerous and deepening divide in this country between a vast number of average borrowers and a fairly elite slice of corporations, banks and executives enriched by the mortgage mania,” she plunges right through the surface into the depths of a subject that has been banned from polite society for decades.

Let’s listen in; we may as well because the chances are good that no one will catch us.

Borrowers who are in trouble on their mortgages have seen their government move slowly — or not all — to help them. But banks and the executives who ran them are quickly deemed worthy of taxpayer bailouts.

On the ground, this translates into millions of troubled borrowers, left to work through their problems with understaffed, sometimes adversarial loan servicing companies. If they get nowhere, they lose their homes.

Taxpayers, meanwhile, are asked to stand by with money to inject into Fannie Mae and Freddie Mac, the government-sponsored mortgage finance giants, should they need propping up if loan losses balloon.

The message in this disconnect couldn’t be clearer. Borrowers should shoulder the consequences of signing loan documents they didn’t understand, but with punishing terms that quickly made the loans unaffordable. But for executives and directors of the big companies who financed these loans, who grew wealthy while the getting was good, the taxpayer is coming to the rescue.

She’s talking about a fairly narrow slice of the population here —way more people don’t own homes and didn’t borrow money on piratical terms than do and did — but when you throw in some of her other work, such as her criticisms of the monumental gap between employee wages and executive compensation, Morgenson is about halfway to a Marxist critique of the capitalist system. Coming as it does from a leading light of financial journalism, and arriving as it does via the pages of the Times, there’s nothing subprime about this rant.

Continue reading Bernanke gets blasted by raving Marxists in the New York Times