I don’t know if it’s even necessary to parse the President’s statement on the foreclosure fraud settlement today. And I’m not too interested in the justifications on conference calls that have been pushed my way from AG Schneiderman and HUD Secretary Donovan. I want to, rather, go back to December 14, 2010. Tom Miller, the Iowa Attorney General, was just named the head of the 50 state investigation looking into foreclosure fraud, and he held a meeting with community activists in Iowa. This is what he said.

“We will put people in jail,” Miller said, in response to questioning. “One of the main tools needs to be principal reductions, just like in the farm crisis in the 1980s…There should be some kind of compensation system for people who have been harmed…And the foreclosure process should stop while loan modifications begin. To have a race between foreclosures and modifications to see which happens first is insane.”

Now, most of the elements of that paragraph got accomplished, albeit in exceedingly small measures. The principal reductions will help 1 million underwater borrowers when 11 million are underwater. The “compensation system” for people who have been harmed is a $2,000 check. Dual track is “restricted.”

So Miller may have a plausible case on some of this, although the weak penalties are a problem in and of themselves. But then there’s that opening line: “We will put people in jail.” That was the promise that will clearly go unfulfilled. Now, Miller walked back that statement almost as fast as he said it. He eventually reckoned that the foreclosure fraud issue was “inherently civil” and not criminal. And he will tell you up and down that no criminal claims were given up in the settlement.

Come on. If AGs cannot win additional civil penalties on foreclosure fraud, they are not going to try to bring criminal charges. That’s just not how it works. There are a couple scattered criminal suits out there, in Missouri and Nevada, against document processors like LPS and DocX. And now, they basically cannot go up the chain to get back to the bigwigs who authorized the fraud. I’d be happy to see LPS and DocX executives in jail and their businesses dismantled, but the buck will stop there. And they are the Lynndie Englands of this scandal, when it comes down to it.

This is the broken promise. “We will put people in jail.” I’ve already explained why the failure to prosecute is not just a bloodthirsty demand for a lynch mob, but a serious point that has implications for our economy. Through criminal affirmance, banks will feel no compunction against doing this type of thing again. Investors will be once bitten, twice shy on mortgage backed securities, and the federal government will keep this enormous risk on their books. And it’s about accountability and justice, which has decayed American politics for the last decade.

I’m really not the kind of person that needs frog-marching for the sake of frog-marching. But the lack of prosecutions for criminal wrongdoing, as said by luminaries like Bill Black and Charles Ferguson and Simon Johnson and more, just furthers a financialization of our economy that is sure to cause more crises, and keeps the rot at the heart of this massive mortgage system in place.

Now Eric Schneiderman told Greg Sargent today that the coalition around these issues will force his RMBS task force, the last stand available for justice and accountability, into action.

“This will ultimately depend on the coalition that’s assembled around these principles,” Schneiderman said. “We’ve now got a progressive coalition that … can move public officials to take a more aggressive approach.”

He also said that “people on the left have to take yes for an answer.” I really only have one question. “Will we put people in jail?”