Out of Control Policy Blog

Wikileaks and the Banks

There are a lot of rumors floating around that it wasn't until Julian Assange announced he was targeting the banks that servers started to get attacked and blocked finally forcing Wikileaks off US soil and into another domain name. While I wouldn't be stunned to find one day that the banks did pressure the government on this, I think a more credible conspiracy theory would be that Assange wanted to get his site booted from U.S. servers to bring even more attention to himself. 

Let's be real: if Wikileaks wants to dump information it will get out, even if they have to report from a .ch site instead of an .org. Even if U.S. papers didn't detail a future information dump, European papers certainly would—and Der Spiegel has been one of the papers working closest with Wikileaks to report on the material. So if there was truly some threatening information, this is hardly the way to try and prevent it.

Furthermore, what information could Assange have that would be worse than what we already know about the banks?

  • We already know that a Treasury secretary forced a bank to take a $20+ billion loss in a merger of another bank
  • We already know that the U.S. government continues to own banks, including 11 percent of Citi
  • We already know that banks danced around the law during the past decade (i.e. Foreclosuregate and Lehman's Repo 105 scandal)
  • We already know that banks felt fine with mediating a trade they knew would cause a client money (i.e. Goldman/Abacus saga), though this was legal
  • We know that lenders like Countrywide were far from ethical
  • We know that the GSEs contributed heavily to Congressmen—like Barney Frank and Spencer Bachus—to keep Congressional favors coming their way and avoid reform
  • We know that regulators have set loose laws for firms and then jumped into the private sector to take advantage
  • We know the Fed was engaged in some serious back room dealing to keep banks afloat during the 2008 nightmare
  • We know that Goldman got a lot of cash in the AIG bailout
  • We know that European banks got a lot of cash in the Fed's unorthodox monetary programs

Even if the Wikileak papers reveal other unethical practices, unless Assange can prove Bank of America financed the 9/11 attacks, the banks will survive. If allegations and scandals of the past two years haven't killed the banks, this won't

So are the banks behind this? Probably not, though they certainly don't want to be embarrassed again. More likely that the White House finally was Fed up with the embarrassing leaks and decided to pounce. They have not been known for having swift responses to anything. That would make this more of a timing coincidence than anything else. But it still could be that this was a straw breaking announcement, since the U.S. government is heavily invested in ensuring the stability of the banking sector, the bank targeting might have been enough to put them over the edge on their own.

Anthony Randazzo is Director of Economic Research


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