Despite the damage it yet may cause, though, the spectacle does seem to be helping to disarm some of the banksters’ ideological weaponry. In the debate over why the financial system collapsed and how to rebuild it, economic assumptions that have enjoyed hegemony for the past 30 years are being questioned, and a swelling chorus is supporting a return to stronger regulation<\/strong>. <\/font><\/p>\n David Stockman, President Ronald Reagan’s director of the Office of Management and Budget, recently weighed in: "The baleful reality is that the big banks, the freakish offspring of the Fed’s easy money, are dangerous institutions, deeply embedded in a bull market culture of entitlement and greed." <\/font><\/p>\n Stockman welcomed President Barack Obama’s proposed tax on banks because its message is that "big banking must get smaller because it does too little that is useful, productive or efficient." <\/font><\/p>\n While the United States economy remains mired in a weak, jobless recovery, the financial sector has used its political clout and government largesse to once again go for the gusto. In the third quarter of 2009, according to economist Dean Baker, finance grabbed 34 percent of all U.S. corporate profits, a far bigger share than at the peak of the housing bubble<\/strong>. <\/font><\/p>\n In the political arena, too, Wall Street is back in force. As Congress debates proposals for financial re-regulation, the financiers have cried "Havoc" and let slip the canines of K Street against the reforms. <\/font><\/p>\n At Goldman Sachs, the leader of the pack, any embarrassment over the savaging of the global economy is well-hidden. The investment bank, popularly dubbed "Goldman Calf", reportedly has given its employees some 13 billion dollars in bonuses for 2009. That nearly triples its largesse in 2008 when, according to the Wall Street Journal, 953 employees received bonuses of over one million dollars each. <\/font><\/p>\n The bank reported earnings of 13.4 billion dollars for 2009, nearly matching the 15 billion dollars combined total of the five other biggest banks<\/strong>. Its net profit margin was 23.85 percent<\/strong>. <\/font><\/p>\n Goldman received 10 billion dollars in funds from the U.S. government’s Troubled Asset Relief Program in 2008, which it paid back with interest in 2009. The firm also benefited from other forms of government generosity, including an estimated 12.9 billion dollars as a counterparty of AIG. <\/font><\/p>\n The failed insurance behemoth used bailout funds to pay off credit default swaps and other complex wagers on bond markets at allegedly inflated values to Goldman and several other U.S. and European financial giants. For some time before the crash, GS had reportedly been betting against the mortgage market. <\/font><\/p>\n The apotheosis of Goldman Sachs has relied on a revolving door between the firm and lofty precincts of the federal government. Henry Paulson, the George W. Bush administration’s secretary of the Treasury responsible for TARP, formerly served as the firm’s CEO<\/strong>. Robert Rubin, Treasury Secretary under President Bill Clinton, and many other power brokers in both major parties are also alumni<\/strong>. <\/font><\/p>\n A long year after the industry’s near-death experience, Goldman’s glass is either full or overflowing, depending on how you look at it. So is popular anger against it. Rolling Stone magazine writer Matt Taibbi celebrated the investment bank as "a giant vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money<\/strong>." <\/font><\/p>\n Satirist Andy Borowitz reported tongue-in-cheek that Goldman was in talks to buy the Treasury Department. He quoted an apocryphal Treasury spokesman as saying that the merger would create efficiencies for both because of the high volume of employees and money already flowing back and forth between them. The only hard part, the spokesman said, "is trying to figure out which parts of the Treasury Department we don’t already own." <\/strong><\/font><\/p>\n Belatedly, Obama and the Democrats seem to have decided that popular anger on the right and the left churned up by the financial industry may be a political wave they can ride. <\/font><\/p>\n In December, the House of Representatives passed a bill that would create an independent financial protection agency for consumers<\/strong>, a measure long lobbied for by Harvard law professor Elizabeth Warren<\/strong>, director of the Congressional Oversight Panel for the bank bailout. <\/font><\/p>\n The legislation would also increase banks’ capital requirements and limit their leverage<\/strong>, the extent of their reliance on borrowed funds. And by requiring lenders to hold on to some proportion of the loans they make,<\/strong> the law would restrict securitization, the practice of bundling mortgages into complex derivatives that frequently have turned toxic, dragging down financial institutions that hold them. <\/font><\/p>\n In the Senate, though, prospects for 60 votes to break a potential filibuster look dubious. Republicans appear to be nearly unanimous in their opposition to the reforms<\/font><\/strong>\u2026<\/font><\/p>\n<\/blockquote>\n Inserted from <Common Dreams<\/a>><\/p>\n I\u2019ve discussed my solutions enough times that I won\u2019t repeat them today, but one thing is clear. The only way to accomplish even minimal banking reform is through reconciliation. <\/p>\n","protected":false},"excerpt":{"rendered":" Not much of this is new, but the article provides good overall perspective. Reckless greed on Wall Street is a dog-bites-man story. Still, the renewed feeding frenzy of the alpha dogs of finance in the embers of the bonfire of their own vanities has inspired amazement and disgust across the political spectrum. Despite the damage […]<\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":["post-610","post","type-post","status-publish","format-standard","hentry","category-politics","category-5-id","post-seq-1","post-parity-odd","meta-position-corners","fix"],"_links":{"self":[{"href":"https:\/\/www.politicsplus.org\/blog\/wp-json\/wp\/v2\/posts\/610","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.politicsplus.org\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.politicsplus.org\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.politicsplus.org\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.politicsplus.org\/blog\/wp-json\/wp\/v2\/comments?post=610"}],"version-history":[{"count":0,"href":"https:\/\/www.politicsplus.org\/blog\/wp-json\/wp\/v2\/posts\/610\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.politicsplus.org\/blog\/wp-json\/wp\/v2\/media?parent=610"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.politicsplus.org\/blog\/wp-json\/wp\/v2\/categories?post=610"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.politicsplus.org\/blog\/wp-json\/wp\/v2\/tags?post=610"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"croniecap\"](\"http:\/\/s217.photobucket.com\/albums\/cc83\/TomCat1948or2\/Blog%202010\/J-M\/LootingtheRuinsofWallStreet_2422\/croniecap.jpg\" "\\"croniecap\\"")
<\/a> Reckless greed on Wall Street is a dog-bites-man story. Still, the renewed feeding frenzy of the alpha dogs of finance in the embers of the bonfire of their own vanities has inspired amazement and disgust across the political spectrum.<\/font><\/p>\n