Unraveling the social contract

Two very different articles -- same message:

Allen Sloane in Fortune in "Want to get away with murder? Become a bank" writes of the two-faced system of justice that lets the banks get away with robbery, while individuals get taken to the cleaners:

It's utterly shocking, even to a congenital skeptic like me, to see that giant institutions such as Bank of America (BAC, Fortune 500), GMAC, and J.P. Morgan (JPM, Fortune 500) were allegedly using misleading affidavits to oust people from their homes. Employees of these institutions -- the "robo-signers" -- repeatedly misled courts by saying they had examined documents they hadn't examined and had reviewed documents they hadn't reviewed.

If you or I as individuals did that, we'd be kicked to the curb by the legal system in about two seconds. If we said that we hadn't wanted to spend the money to do things right -- the real reason that robo-signers exist -- it would take only one second for the system to whack us.

Follow this with a post that quotes Mr. Sloane's, but puts it on a more personal level -- Karl Denninger in The Market Ticker, explaining why "The banks must not get away with this."

There's a limit to the screwing of this sort that the people will take. I have no idea where it is. Neither does anyone else. The Politicians definitely don't; they're tone deaf to this sort of abuse, because most of them haven't bought their own groceries or pumped their own gas in 20 years. We have reported every time there's an election how "Politician X" didn't pay his 24 speeding tickets and as a result his license was suspended - but now he paid them and it's all ok.

These people live in a different world. If you or I don't pay one speeding ticket the next time we're tooling down the road the cop's "robocamera" will pick up our license plate and we'll get treated to the felony stop - that's where four cop cars pull you over and the cop steps out with his gun out, behind his door, and tells you to get .. out of the car and lie on the ground. Then, since you've got a suspended license, you get to spend the night in jail before you see The Judge.

This isn't hyperbole - it happens all the time. Sometimes it's legitimately you trying to be an ass - you tossed the ticket and the warning from the state that your license and plates were suspended.

But sometimes it's not - you didn't get the notice yet, or you send in a check but for the wrong amount. No matter, you get the felony stop treatment.

Here's the problem: If the people get into their head that not only politicians can do this sort of thing and get away with it when it comes to things like traffic tickets, but banks can literally rob the people with predatory lending and then enlist the courts to screw them a second time in unjustly evicting them from their house, there is a point where they will snap.

Many of us sense that we are very close to that point. If the line gets crossed, the banks will discover just what it means to hurt, because we'll go through a time when it will be impossible for banks to do business. And it won't be pretty.