Curbing Wall Street

Republicans are perpetrating a fraud. They say they're concerned about reducing government deficits. But you don't need to look at how they treat all of the country's biggest corporations (which is extremely well) or even how they kowtow to its richest 400 families, who now have 6900 times as much income as the average household, to know that's a lie.

You only need to look at the way they treat a handful of billionaires. They're holding the entire country's budget hostage because they don't want to raise taxes on the wealthy, and they don't want to eliminate a tax loophole that could be bringing in more than $4 billion each year ... from only 25 people.

The top 25 hedge fund managers in the United States collectively earned $22 billion last year, and yet they have their own cushy set of tax rules. If they operated under the same rules that apply to other people - police officers, for example, or teachers - the country could reduce its national debt by as much as $44 billion in the next ten years.

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Why are people still interested in what Jamie Dimon has to say? As CEO of JPMorgan Chase, Mr. Dimon presides over a serial corporate criminal whose long list of misbehaviors[1] got longer only last week. As an investment and economics "expert" he failed to anticipate the worst financial crisis in modern history.

Now Jamie Dimon's come up with a list of economic concerns for the economy that would be amusingly clueless, if it weren't such a sad example of the Marie Antoinette-like detachment and hauteur of our financial leaders.

Dimon had a lengthy interview with an Australian newspaper, which Business Insider distilled into five reasons why (according to Mr. Dimon) people are negative about the economy: more »

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There's reason to believe that the White House held back on helping struggling homeowners because it was afraid of a Tea Party backlash. That was exactly the wrong response, politically as well as economically. Bolder and more effective action would have weakened the anxiety and frustration driving that movement. By fearing the Tea Party, the Administration has only made it stronger. more »

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I never expected I'd be called upon to write an open letter to the Speaker of the House because he used my words in a misleading way. And I certainly never expected that letter to include detailed descriptions of the plot and weaponry used in the Star Wars movies. But here we are.

In a move that some of us have anticipated since early 2009, the Republicans are now running to both the left and right of the White House on jobs, emphasizing populist themes while pushing pro-corporate policies. As part of that campaign, Speaker of the House John Boehner's latest blog post quoted a series of progressive writers and organizations who have criticized the White House's overly cautious jobs approach. (Or course, we know that most politicians' posts and tweets are written by their staff, and we've all learned why that can be a good idea.)

The Speaker's post quoted me out of context in exactly the same way movie reviews are sometimes quoted in movie ads. (The review: "This turkey gave me a terrific headache."The poster: "Terrific!") The following letter will hopefully clear the record. more »

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In light of today's terrible job numbers, it's a bittersweet experience to re-read a recent report from Wells Fargo Bank which argues that high unemployment is "the new normal." While it's comforting to find Wells Fargo employees who aren't laundering money for the Mexican drug cartels, their report is one more ideologically-driven nail in the coffin of America's jobs agenda.

Ideology's not a bad thing in politics, but it is a bad thing when it's disguised as as a work of unbiased analysis. Despite their mild disclaimers, that's exactly the posture Wells Fargo's economists are adopting.

They may not even realize how biased and ideological their report is, and that's the problem. Almost three years later, people are still hewing to the flawed philosophies that led to the financial crisis. That prevents the country from taking steps to end the permanent recession that enshrouds whole segments of our population. more »

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"Money doesn't talk," sang Bob Dylan, "it swears." Rep. Patrick McHenry gave the week's most famous seventy year old a dark birthday gift on Tuesday by proving that those lyrics still ring true after nearly half a century.

McHenry's savage attack on Elizabeth Warren and the Consumer Financial Protection Bureau was an obscenity by any definition except the FCC's, an assault on human decency which proves once again that Wall Street's Capitol Hill goon squad is prepared to discard decency at a moment's notice to serve its masters.

One of the best ways to understand events like today's hearing is by looking at the actors involved, and today's case study is Patrick McHenry, Republican from North Carolina.He may have disgraced himself before the voters today, but look on the bright side: Rep. McHenry is now Wall Street's "Employee of the Month."

McHenry, like other Republicans before him, is just the latest symbol of a party that's stopped pretending that its actions are motivated by anything except a desire to serve Wall Street and other large corporate interests. more »

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A group of Democratic representatives has joined consumer groups- along more »

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In a piece called "Wall Street: Not Guilty," financial columnist Roger Lowenstein attempts to defend Wall Street against allegations that it's a viper's nest of rampant criminality. His mischaracterization, mockery, and vague suggestions of McCarthyism are strident, flat, and fail to get the job done. But Lowenstein's piece is well worth reading, if only as a case study in the moral and cognitive blindness that's reached epidemic proportions in influential Washington and Wall Street circles.

Lowenstein shows us how people who are undoubtedly thoughtful and ethically-minded in their personal lives can lose their way when confronted with complex moral and legal issues, especially ones involving people they know personally. And his misdirection and vituperation suggests how unsettled they become when their worldview is challenged.

It's a shame. The analytical and moral flaws in Lowenstein's piece obscure some of the very sound points he makes about the wrongheadedness of our country's financial culture, a topic that deserves more thoughtful discussion. Without a clear rebuttal, this wrongheaded view is likely to become tomorrow's conventional wisdom.

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Some of the headlines about the conviction of hedge fund manager Raj Rajaratnam are misleading or just plain wrong. The Rajaratnam guilty verdict won't "change the way Wall Street does business" - not where it matters most. Too Big to Fail banks will continue to endanger the economy because they know they'll be rescued again. And they'll keep on breaking the law, knowing that even if they're caught they'll be protected from prosecution.

And yet, instead of being grateful, bankers like JPMorgan Chase CEO Jamie Dimon will continue to publicly sulk about their own perceived mistreatment. That can be annoying, since the U.S. taxpayer saved their corporations, their careers, and their wealth from the consequences of their own mismanagement.

But in the end all this public posturing is just a form of territorial primate display, like mandrills showing their brightly-colored posteriors to zoo visitors. These bankers are reminding us that this country's economy and government are their territory and we're just trespassing on their mating grounds. To paraphrase an old Sam and Dave song, "It's their world, we're just living in it."

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Big banks and credit card companies have made a PR misstep in the fight over debit card charges. They're trying to use the Bush Administration's anti-terror team to convince Americans that exorbitant debit card fees are needed for our nation's security. The timing couldn't be worse. Just as Bin Laden was being hunted down they decided to rely on the credibility of Michael Chertoff and Gen. Michael Hayden, two of the senior officials who failed to find him.

It's hard to imagine that somebody made a proposal for this campaign and somebody else gave it the green light. Attackers could strike the U.S. banking system, of course, either for criminal purposes or as a terrorist act. (I wrote a memo on the topic myself, in 1998.) But this campaign never suggests that any significant portion of U.S. debit card fees is being used to prevent cyber-attacks. Instead they use vague threats and insinuations to suggest that an attack could happen, and that we could be very, very sorry, if we don't do as we're told.

Sounds familiar, doesn't it? Just think: For a few bucks more they could've hired Tom Ridge to issue an "orange alert." more »

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