With Tuesday's $13 billion settlement with J.P. Morgan over the sale of mortgage-backed securities, the Justice Department has finally solved the mystery of the financial crisis. Turns out that the bankers did it—to each other, and even to themselves.

We've been critical of this government plundering of a bank that did not need a bailout in 2008, but we defy anyone to follow the logic of Tuesday's Morgan agreement.

Another problem with this settlement is that even though the government says that ins utional investors were the victims, much of the $13 billion is going elsewhere.In Justice's press release, U.S. Attorney for the Eastern District of California Benjamin Wagner describes "credit unions, banks and other investor victims" who bought mortgage-backed securities that included "toxic" loans. The government claims that Morgan ripped off other financial ins utions when it sold them bundles of mortgages. But the alleged victims include ins utions where the government has separately accused managers of their own mortgage misdeeds.

For example, Morgan will pay a $2 billion fine to Justice, apparently for harming itself. Justice hasn't said exactly how it arrived at this figure, but prosecutors seem to be employing a trendy legal interpretation of the Financial Ins utions Reform, Recovery, and Enforcement Act. Government lawyers claim that under the "self-affecting doctrine," Morgan can be guilty of harming Morgan through its alleged misdeeds. One wonders why Morgan doesn't therefore deserve at least some compensation from Morgan.

Another $7 billion goes to settle various civil claims brought by federal and state agencies. And the remaining $4 billion, according to Justice, will go to "consumers." These payments "will take various forms, including principal forgiveness, loan modification, targeted originations and"—get this—"efforts to reduce blight."

And if the bank doesn't spread enough of the wealth around in this manner it must pay "liquidated damages in the amount of the shortfall to NeighborWorks America, a non-profit organization and leader in providing affordable housing and facilitating community development."

We can imagine how many community organizers will be trying to get a piece of the NeighborWorks pie. And you can expect the phrase "efforts to reduce blight'" to be interpreted in a most liberal fashion.

There's also the detail that close to 80% of the securities at issue weren't even sold by Morgan, but by two failing firms it bought at the government's request, Bear Stearns and Washington Mutual.

There's an old joke that no good deed goes unpunished. That's now Obama Administration policy. According to U.S. Attorney for the Eastern District of Pennsylvania Zane David Memeger, "It is particularly important that JP Morgan, after assuming the significant assets of Washington Mutual Bank, is now also held responsible for the unscrupulous and deceptive conduct" of Washington Mutual.

The only thing clear from this settlement is there will be no willing buyers during the next crisis.