Purchasing a home is usually the only pathway for the working class to accumulate a bit of wealth. Today, working-class home-buying is increasingly out of reach. Housing rent inflation also remains stubbornly high, further squeezing working people, as well as causing the Federal Reserve to fret about why inflation isn’t falling faster.

While economists hunt for technical explanations, they ignore the ways in which Wall Street has come to dominate the housing market to the detriment of working people. The real story is about how our two major political parties have sold out to financialized capitalism.

In 2008 Wall Street crashed the housing market, by profiting wildly from unregulated artificial mortgage-backed bonds. When that house of cards collapsed, they were bailed out with our tax dollars. Then, Wall Street rushed in to buy up housing assets on the cheap, turning them into rentals and profiting yet again from the very mess it had created. And now the working class is being squeezed out of the homeowner market and paying more and more for rentals.

It wasn’t always this way. Following the crash of 1929, caused by massive financial malfeasance, the New Deal ushered in a strong regulatory regime to control the inherent greed of the banking and securities businesses. For 25 years after those stiff regulations went into effect, the standard of living for the working class steadily increased and there were no Wall Street implosions.

The real story is about how our two major political parties have sold out to financialized capitalism.

Those regulations held until the Reagan and Clinton administrations removed many of the guard rails intended to constrain the ability of financiers to manipulate and threaten our economy. Financial recklessness and greed once again were given free rein. By 2008, Wall Street had thoroughly crashed the economy, leading to six million jobs lost in a matter of months.

I gave the crash a good look in my book, The Looting of America. The machinations of Wall Street in the early part of this century involving the housing market were beyond belief. Freed from all serious oversight, large banks and financial firms believed they had engineered a financial miracle – taking all the risk out of high-risk mortgages. They created artificial investment products that the trusted credit rating agencies assured us were as good as gold. Rated AAA, they said.

Sub-prime mortgage-backed securities, built repeatedly upon the same risky mortgages, promised big safe profits, and sold like hot cakes. When those risky mortgages inevitably failed, so did the supposedly safe securities, and the whole system crumbled.

Incredibly, at the same time, some of the richest Wall Streeters created financial products designed to fail, so that they could bet against them. They made billions!

This is the type of garbage that led to the 1929 crash and the Great Depression. In 2008 it was called the Great Recession. Economic devastation, fueled by unregulated banks and securities firms, happened again.

The damage done was so great that the government used taxpayer money to bail out the financial bandits, fearing that if they didn’t the whole economy would collapse into another Great Depression. None of the financial criminals went to jail. Very few suffered serious financial harm. But with the collapse of the housing market millions of homeowners were left with underwater mortgages. The only bailout for them was bankruptcy and ruination.

The country was angry, and this disaster created the perfect opportunity to reregulate Wall Street so that it served the American people, not the other way around.

President Obama, in 2009, understood the public fury aimed at the high salaries that the financial titans had the gall to award themselves even as they were accepting taxpayer support. The CEOs argued that they still needed to pay top dollar for executives during the bailout because, “We’re competing for talent on an international market.”

Obama warned, “Be careful how you make those statements, gentlemen. The public isn’t buying it.” Then he made a telling concession: “My administration is the only thing between you and the pitchforks.”

Obama never channeled the popular anger to bring Wall Street to heel. Instead, that fury energized the Tea Party, which turned the attacks away from Wall Street and towards the government itself. That was the fury Trump rode to power.

Meanwhile, the banks grew larger, richer, and more concentrated than ever. Today the top five banks own more banking assets they had before the 2008 crash. More worrisome yet is that hedge funds and private equity companies, which are far less regulated than........

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