Bernie Madoff Burned Us All

Having plead guilty to all 11 counts today in a Manhattan courtroom, Bernie Madoff is back in jail and awaiting sentencing. He could be looking at 150 years in prison, and will almost certainly spend the rest of his natural life behind bars.

Madoff admitted that he never invested his clients' money, and that he deposited the funds into a "Chase Manhattan" bank.

"When money was requested, I paid it out from the Chase account," he said.

As Madoff wrung his hands and made other nervous gestures, the judge suggested that he pour himself a glass of water.

Madoff created a decades-long scheme in which new investments were used to fund payoffs to earlier investors, to falsely create the appearance of legitimate returns.

Richard Friedman, an accountant who said he lost $3.1 million to Madoff, told CNN that he hopes Madoff is sentenced to the full 150 years and that he "lives a very long life" in prison.

"The crime is really unimaginable," said Friedman. "It's not just a typical Ponzi scheme. It affects society as a whole. You don't just have to be a Madoff investor to be affected by this."

Which is the real problem. Although it's a drop in the bucket compared to the trillions the banks have lost, Bernie's $50 billion scheme still hurt the economy. Of course he's not going to be able to pay anybody back...just like the banks won't be able to pay the taxpayers back either.

And so it goes. The Madoff mess is just a smaller microcosm of the entire financial system meltdown. There are lessons to be drawn, pure greed, lack of oversight by a compliant regulation system, refusal to admit mistakes, a plan that got away from him and went totally awry until it turned into a multi-billion dollar monster.

Every bank that took TARP money is just another Bernie Madoff. There's hundreds of them, costing us trillions and trillions. And yet, we keep on paying. In a very real sense, we Madoffed the entire planet with our own greed.

Now everyone has to pay up and will have to for a long, long time.