Why financial reform will never happen

| February 10, 2010 | 5 Replies

President Obama, 1/29/09:

…when I saw an article today indicating that Wall Street bankers had given themselves $20 billion worth of bonuses — the same amount of bonuses as they gave themselves in 2004 — at a time when most of these institutions were teetering on collapse and they are asking for taxpayers to help sustain them, and when taxpayers find themselves in the difficult position that if they don’t provide help that the entire system could come down on top of our heads — that is the height of irresponsibility. It is shameful.

President Obama, 1/14/10:

As we all know, our country has endured the deepest recession we’ve faced in generations.  And much of the turmoil was caused by irresponsibility on the part of banks and financial institutions.  Firms took reckless risks in pursuit of short-term profits and soaring bonuses, triggering a financial crisis that nearly pulled the economy into a second Great Depression.

My commitment is to recover every single dime the American people are owed.  And my determination to achieve this goal is only heightened when I see reports of massive profits and obscene bonuses at some of the very firms who owe their continued existence to the American people — folks who have not been made whole, and who continue to face real hardship in this recession.

We want our money back, and we’re going to get it.  And that’s why I’m proposing a Financial Crisis Responsibility Fee to be imposed on major financial firms until the American people are fully compensated for the extraordinary assistance they provided to Wall Street.  If these companies are in good enough shape to afford massive bonuses, they are surely in good enough shape to afford paying back every penny to taxpayers.

New York Times, 2/7/10:

Just two years after Mr. Obama helped his party pull in record Wall Street contributions — $89 million from the securities and investment business, according to the nonpartisan Center for Responsive Politics — some of his biggest supporters, like Mr. Dimon, have become the industry’s chief lobbyists against his regulatory agenda.

Republicans are rushing to capitalize on what they call Wall Street’s “buyer’s remorse” with the Democrats. And industry executives and lobbyists are warning Democrats that if Mr. Obama keeps attacking Wall Street “fat cats,” they may fight back by withholding their cash.

Though Wall Street has long been a major source of Democratic campaign money (alongside Hollywood and Silicon Valley), Mr. Obama built unusually direct ties to his contributors there. …

Wall Street lobbyists say the financial industry’s big Democratic donors help ensure that their arguments reach the ears of the president and Congress. White House visitors’ logs show dozens of meetings with big Wall Street fund-raisers, including Gary D. Cohn, a president of Goldman Sachs; Mr. Dimon of JPMorgan Chase; and Robert Wolf, the chief of the American division of the Swiss bank UBS, who has also played golf, had lunch and watched July 4 fireworks with the president.

Bloomberg News, 2/10/10:

President Barack Obama said he doesn’t “begrudge” the $17 million bonus awarded to JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon or the $9 million issued to Goldman Sachs Group Inc. CEO Lloyd Blankfein, noting that some athletes take home more pay.

The president, speaking in an interview, said in response to a question that while $17 million is “an extraordinary amount of money” for Main Street, “there are some baseball players who are making more than that and don’t get to the World Series either, so I’m shocked by that as well.”

“I know both those guys; they are very savvy businessmen,” Obama said in the interview yesterday in the Oval Office with Bloomberg BusinessWeek, which will appear on newsstands Friday. “I, like most of the American people, don’t begrudge people success or wealth. That is part of the free- market system.”

Obama sought to combat perceptions that his administration is anti-business and trumpeted the influence corporate leaders have had on his economic policies. He plans to reiterate that message when he speaks to the Business Roundtable, which represents the heads of many of the biggest U.S. companies, on Feb. 24 in Washington.

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Category: Corruption, Politics

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is a full-time wage slave and part-time philosopher, writing and living just outside Omaha with his lovely wife and two feline roommates.

Comments (5)

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  1. Erich Vieth says:

    According to Les Leopold,

    "Obama has made his share of blunders. However, his statement that we "don't begrudge" the high salaries on Wall Street because that's part of the "free-market system" is about the dumbest thing he's ever said."

    Leopold adds, "Dimon's JP Morgan Chase still has a $34.3 billion subsidy, and Blankfein at Goldman Sachs is sitting on $23.9 billion of government welfare."

    http://www.huffingtonpost.com/les-leopold/obama-i

    I'd like to agree with Leopold, except that I think that Obama decided to say what he said to score points with Wall Street, in order to make money for Democrat politicians. Instead of calling it stupid, I'd call it crass and backstabbing to those who put him in office.

    I'd like to call it stupid, but there's no indication that he will ever have to pay for making this remark. Not with the corrupt political system we have, or the corrupt commercial media.

  2. Niklaus Pfirsig says:

    It might also be possible that Obama is trying to avoid the wrath of the people who provide most of the funding of the smear campaigns against him.

  3. Brynn Jacobs says:

    Niklaus:

    That's exactly the point. Wall Street will support one or more candidates, not necessarily the incumbent. Whomever they support will bathe in bathtubs full of "campaign donations" (or "bribes", as the rest of the world calls them). Whomever they oppose will rue the day they opposed the criminal banking cabal.

  4. Erich Vieth says:

    Brynn: I know that this post is on the financial sector, but I spotted something that is more fuel for the fire: Obama's lovefest with Big Pharma. Lots of undeniable details. http://www.huffingtonpost.com/paul-blumenthal/the

    Here's how I summarize it: "Drank the Kool-Aid" = "Took the Money."

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