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by Richard Mellor
Afscme local 444, retired
As
I pointed out in an earlier blog, the spending bill passed in Congress last
week included a further offensive against workers’ pensions. Some readers may
be aware that it also contained a provision that eliminated the rule in the
Dodd-Frank act that forbade the trading of derivatives that have government
backing like deposit insurance. That rule made sense from the taxpayer’s point
of view. Why should we not be able to
curb what can be very dubious trades that are backed by taxpayer money?
The bankers didn’t like that provision any more than they
like workers receiving pensions we can live on so they launched an all out
offensive against the rule introducing a provision in the spending bill
repealing it that was said to have been written buy Citigroup. This is where are laws come
from---institutions like Citigroup. Capital should have free reign even when
the losses are covered by public finds.
They were successful in their efforts and the provision
barring the trades was killed in the spending bill Congress passed. “The provision enables the big
banks once again to use insured deposits and other taxpayer subsidies and
guarantees to gamble in the derivatives markets—the very type of business that
drove the 2008 financial crisis and the economic devastation that followed.” Writes
Steve Denning at Forbes. Leading the charge was JP Morgan and its
head man, Jamie Dimon. JP Morgan is the
nation’s largest bank and despite paying almost $18 billion over the past two
years for various illegalities including dodgy bond sales, currency
manipulation and keeping mum about Bernie Madoff’s Ponzi scheme, the bank made $17.9
billion last year and $16.8 billion through the first nine months of 2014
according to Bloomberg Business Week.
Dimon’s argument was that the rule made, “…life expensive
and unduly complicated for banks.”, according
to Business Week. He made this argument to the legislators of the two Wall
Street parties in Congress. Dimon met with two of the bankers’ political
representatives in Congress, Senator Orrin Hatch of Utah and House Financial
Services Committee Chairman, Jeb Hensarling of Texas. In addition, Dimon
lobbied many others.
I find the comments about Dimon’s success from some quarters
rather uninformative. The liberal economist Jared Bernstein who was Joe Biden’s
economic advisor and a long-time associate of the liberal Economic Policy
Institute, told BusinessWeek, “Even
if those people screw up demonstrably, their influence doesn’t seem to be
dented much at all.”. Ted Kaufman, a
Delaware Democrat who has made some efforts to limit the size of banks
attributes Dimon’s ability to sway the politicians to him being “Teflon coated.”
Why is Bernstein surprised? He is only right in that the
influence of the bankers even after screwing up big time almost driving the
capitalist system into the abyss isn’t “dented much at all” as far as the
members of Congress and the two wall Street parties are concerned. For workers
and the middle class, the poor and most Americans, the Bankers are still hated,
mistrusted and held responsible for the Great Recession that began in 2007.
Kaufman’s comment is just plain childish. It’s quite obvious why Dimon was able to
persuade lawmakers to eliminate a provision in the spending bill harmful to
banks, speculators, money traders and other wasters, JP Morgan spent more on
lobbying (bribing) this year than any other bank. If you include them all, there’s a lot of
political payola going on. Coincidentally, JP Morgan’s employees and political
action committees, “…have been the biggest source of campaign contributions to
Hensarling over his career.” It’s nothing to do with Teflon, sharp talk or
intelligence on the part of Dimon. You grease the right palms you get the right
laws passed. That’s how American democracy works.
Meanwhile Dimon says that, “…people are wrong to see Wall Street as a bunch of tough,
greedy fighters. ‘We’re more like lovers, We want to compromise and get things
done.’”
The
combined wealth of the Forbes 400 in 2014 is $2.29 trillion, enough to solve
global poverty. Dimon earns about $25 million a year and like all of them, has
his fingers in much of the government pie. What inhumane people these
characters are. And they profess to be religious too and probably go to church
as part of their public charade.
If
all goes well they might go down the same road the Romanovs did.
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