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Politicians are the best insurance money can buy

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In a blockbuster study that was revealed on Aug. 12 by Michael Hiltzik, and discovered through the Social Science Research Network institution, it appears that buying elected officials holding a political office might just be the best insurance money can buy to protect a company from investigations by the SEC, or other government regulator. In the study titled, Political Connections and SEC Enforcement, author and researcher Maria Correja of the London Business School corroborated what many economists had only speculated, and showed with concise data that the more a company gives to politicians through campaign contributions and donations, they less chance they have of ever being investigated or indicted by the SEC or other government agency.

The numbers and examples used by Correja in her study show a significant decrease in the odds of being investigated by the SEC when donations to a politician climb as high as $1 million, and when the time frame before fraudulent behavior is discovered is at least five years difference.

A recent study by Maria M. Correia of the London Business School puts statistical meat on those bones. The more a company spends on political donations, she finds, the more lenient the treatment it gets from the Securities and Exchange Commission.

Correia even quantifies the value of political grease. A $1-million increase in contributions by a corporation to a political action committee in the five years before a violation of SEC rules, she finds, can reduce the probability of an enforcement action from the SEC by more than half (from 8.58% to 3.43% in her sample). Her conclusion is that "long-term PAC contributions are effective at deterring SEC enforcement." - LA Times

These results can easily explain why Congress was so eager to bail out the banks in 2008 with taxpayer funds, and why President Obama has indicted zero bankers or company executives in the five years since he took office. In fact, in 2013 PBS aired a special documentary titled, The Untouchables, in which they show the how and why no CEO's or bankers have ever been prosecuted for nearly collapsing the Western banking system, and why they have in fact been given carte blanche to continue the fraud without fear or repercussions from the SEC, DOJ, or any other government entities.

Politicians such as former Senator Chris Dodd, and former Congressman Barney Frank, were both bought and paid for by the banks and corporate system, who ensured the protection of their businesses by passing the Dodd-Frank Wall Street Reform and Consumer Protections Act of 2010. In this bill, nothing was actually done to deal with banks that had become too big to fail after these same politicians repealed Glass-Steagall in 1999, and in fact, the nefarious part of Dodd-Frank was that it now allows banks to declare deposits as unsecured liabilities and can use them as capital in case of a bank default, or the next economic collapse.

It is no longer surprising that more members of Congress are millionaires now than at any time in history, and that insider trading, as well as limited prosecutions, are the norm in our government rather than the exception. And with Marie Correja's detailed study showing that what many once considered conspiracy theory to now be conspiracy fact, the bottom line is that buying off a politician, and having one owing you a favor if you are a big business, is by far the best insurance money can buy.

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