Elwood John Walzer and Legal Ethics
Gender Wars

Banking Morality

The double standards that exist between banks and ordinary Americans are many.  People like Todd Zywicki and Megan McArdle continue fighting for the banks right to live under a separate "code" of (dis)honor.  Here is the banks' latest attempt:

A group of the largest commercial banks asked the U.S. Supreme Court to let the government continue to withhold details of emergency loans the Federal Reserve made to financial firms in 2008.

You, me, and everyone else has a credit report.  Banks keep detailed records about our borrowing and spending.  They will not loan anyone money who does not have a credit report.  How else can they assess the risk of making a loan?

The bank group is appealing a federal judge’s August 2009 ruling requiring the Fed to disclose records of its emergency lending. Bloomberg LP, the parent company of Bloomberg News, sued for the release of the documents under the Freedom of Information Act.

The central bank has never disclosed the identities of borrowers since the creation in 1914 of its Discount Window lending program, which provides short-term funding to financial institutions, the Clearing House said in its petition.

“Disclosure of this information threatens to harm the borrowing banks by allowing the public to observe their borrowing patterns during the recent financial crisis and draw inferences -- whether justified or not -- about their current financial conditions,” the group said in its appeal. Calls to Paul Saltzman, general counsel for the Clearing House, were not immediately returned.

Banks borrowed our money.  Yet when we ask to see their credit report, they file appeals in the United States Supreme Court preventing us from seeing it.

How can anyone seriously continue defending the banks?  How much money does Todd Zywicki, an employee at a taxpayer-funded institution, make "consulting" to banks?  How can anyone take people like Todd Zywicki and Megan McArdle seriously?