Take a look at these two sentences:

“(I)f losses from the 2007- 2009 crisis were to reach similar levels (as they did in previous recessions) … losses could exceed $13 trillion.” Government Accountability Office

“You would think that any regulation that could affect a major part of the economy and cost industry and/or consumers millions of dollars to comply with would be based on rigorous and consistent economic analysis.” David C. Johns, Heritage Foundation

In the face of trillion-dollar losses, Wall Street’s conservative spokespeople sound like Dr. Evil presenting his demands to world leaders: I will destroy the planet unless you give me … one million dollars.

The Price of Greed

The other day the GAO released a report on the costs of the 2008 financial crisis and the recession which followed – which is still going on for millions of Americans. The report confirmed and even increased previous estimates of the crisis’ cost, concluding that losses in American output could reach $13 trillion.

The report did something else that was important and admirable, too: It considered the human cost of the recession, noting that “real GDP” – the most commonly used economic measure in situations like these – “is an imperfect proxy of overall social welfare.”

That’s especially true today: While overall statistics show that our country is in a recovery, the top 1 percent in US income captured 121 percent of the gains, while everyone else has actually lost ground since then. Once that’s considered, even the GAO’s new figures may have understated the costs for the vast majority of Americans.

But, admirably, the GAO report summarizes the painful but now well-known loss of jobs in the present – and, especially for younger people, the earnings potential that they will suffer for the rest of their lives.

Homeowners Are Financing a Backdoor Bailout

The GAO also estimates the loss in housing value for American families, which it pegs at $9.1 trillion, noting that “national home equity was approximately $3.7 trillion less than total home mortgage debt.”

What they’re describing is nearly four trillion dollars in money that Americans owe to their banks for real estate value that no longer exists. They base that number on December 2011 figures, and it will have changed by now – both because some real estate markets have picked up, and because millions of homeowners have been foreclosed upon. But the figure is still in the $3 trillion range.

That’s $3 trillion in debt that homeowners took because the banks a) systematically drove up the costs of housing by lowering underwriting standards and creating a boom in mortgage-backed securities, b) knowingly bilked investors by selling them lousy risks (which the so-called “credit rating agencies” labeled “AAA”), and then c) accepted a government bailout when the inevitable collapse followed.

And in yet another enormous favor to the banks, they continue to carry this worthless value on their books. They collect payments on it, or use it to foreclose on families.

Designed by a Committee

The GAO report’s conclusion is all the more astonishing, since it was produced by a committee which included a number of relevant “stakeholders”: A major institutional investor (from the California Public Employees’ Retirement System); bankers, financiers and hedge funders from institutions like Goldman Sachs, Deutschebank, and Black Rock; the pro-99 percent Americans for Financial Reform; along with Paul Volcker, Sheila Bair and other subject matter experts.

...behind the “some experts believe” language is an inescapable conclusion: The 2008 crisis cost the US economy in excess of $10 trillion, and possibly more than $13 trillion.

That means the report’s filled with “he said/she said” counterpoint on even relatively non-controversial matters. But behind the “some experts believe” language is an inescapable conclusion: The 2008 crisis cost the US economy in excess of $10 trillion, and possibly more than $13 trillion.

What’s more, there’s very little controversy about the fact that it will happen again. Even Jamie Dimon, the JPMorgan Chase CEO who has appointed himself to be unapologetic face of Wall Street excess, agrees. He proudly told a Congressional hearing that when his little daughter asked him “What’s the financial crisis?” he answered “It’s something that happens every five or seven years.”

Recurring crises are part of their business model. And while every crisis won’t all cost $10 trillion or $13 trillion, one will eventually come along that costs much more.

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Hired Guns

Banks are deploying every possible argument to prevent that from happening. The latest is to ensure that bank-subservient Republicans block funding for any agency that’s been tasked with monitoring bank activity.

Before we get to the Republicans, though, did you happen to see this story? “Former U.S. Sen. Kent Conrad has signed on with the national Campaign to Fix the Debt,” it says.

“Fix the Debt’ is a covert lobbying group for big banks, defense contractors, and individual billionaires. When it comes to corporate buyouts, members of both parties are available. Democrat Conrad spent years telegraphing his support for the corporate agenda.

As we like to say, “bipartisan” is a Washington code word for “buying members of both parties.”

But, while some Democrats may be morally compromised, it now appears that the Republican Party has become a wholly-owned subsidiary of Wall Street. They’re blocking the funds to implement the Dodd/Frank bill. That bill’s reforms fall short of what’s truly needed to end Wall Street’s destructive rampage, but it’s a step in the right direction – which means that, for the GOP and its parent companies, it’s a step too far.

Mad-Hatter Economics

You have to be pretty shameless to say something like this: “The Committee will seek to ensure that regulators carefully and transparently assess the costs and benefits of regulations called for by the Dodd-Frank Act in order to strike an appropriate balance between prudent regulation and economic growth.”

That was Republican Representative Jeb Hensarling, echoing the right-wing line: Can’t spend millions to protect us from losses in the trillions. Meanwhile the SEC is begging for funds, as are the other agencies charged with implementing Dodd/Frank.

...as Washington argues about whether it should spend millions to save Main Street’s residents trillions, both parties are reportedly open to a budget agreement that would cut $130 billion in Social Security benefits for the elderly and disabled over the next ten years (according to White House estimates). In Washington that’s an acceptable “buy-partisan” solution.

But the ultimate in tortured pro-bank logic is a bill called the “Financial Regulatory Responsibility Act,” which has been floating around the Hill since its introduction in 2011. It would require regulators to prepare lengthy analyses of the cost of enacting new regulations, and then to submit their economists to a politicized interrogation before Congress.

This bill’s just another tactic for delaying and obstructing urgently-needed reform, and the arguments wear thin before the sentences are even completed. “American job creators are under siege from the Dodd-Frank Act,” said cosponsoring Senator Richard Shelby. “In their rush to expand the reach of government into our private markets, Congressional Democrats refused to consider the impact of the Dodd-Frank Act on economic growth or job creation.”

With 20 million jobs lost worldwide after the 2007/2008 crisis, this is hardly a strong argument for the defense. If these guys are such great “job creators,” where are the jobs?

Pay Now and Pay Later

But if the “Financial Regulatory Responsibility Act” can’t be understood in logical terms, it can certainly be understood in financial ones – especially for its Congressional sponsors, who bask in campaign contributions and look for to Conrad-like sinecures upon leaving office. Organizations lobbying for the bill include the American Bankers Association, the US Chamber of Commerce, the Managed Funds Association, and a wide range of financial and insurance companies.

As the saying goes: Follow the money.

And as Washington argues about whether it should spend millions to save Main Street’s residents trillions, both parties are reportedly open to a budget agreement that would cut $130 billion in Social Security benefits for the elderly and disabled over the next ten years (according to White House estimates). In Washington that’s an acceptable “buy-partisan” solution.

But, especially for the Republicans, it isn’t acceptable to ask the bankers who cost Americans trillions of dollars – and walked away wealthy – to spend millions to prevent another trillion-dollar crisis.

After all, they might have to spend one million dollars.