|‘Banksters’ and banks like Wells Fargo have become targets of the Occupy movement [GALLO/GETTY]|
You can bank on a banking crisis. You can bank on bankers who are primarily interested in their own portfolios.
You can bank on banks remaining key behind-the-scenes players in our politics and outspoken when they sense that regulators are moving in on their permanent party of payouts.
You can bank on their outrage when someone, anyone, suggests that they should pay their fair share or that their greed has to be checked or practices punished.
Bankers are circling their guilded wagons to fight off attacks on many fronts.
In the public arena, they are increasingly fed up with the “imbecilic” – stronger language to come – critics from the likes of Occupy Wall Street that they fear are inspiring public hostility to the lords of finance.
There have even been protests at recruiting conferences on campuses where the MBA’s used to stand in line for a chance to rake in the outsized salaries that awaited kids blessed as bankster-worthy.
This is upsetting to Jamie Dimon, the $23m a year CEO of JP Morgan Chase, who is taking umbrage, telling an investor’s conference: “Acting like everyone who’s been successful is bad and because you’re rich you’re bad, I don’t understand it.”
Bernard Marcus, a co-founder of Home Depot, and self-described “job creator” didn’t mince his words, according to Bloomberg News.
“If successful business people don’t go public to share their stories and talk about their troubles, they deserve what they’re going to get.” He said he isn’t worried that speaking out might make him a target of protesters.
“Who gives a crap about some imbecile?” Marcus said. “Are you kidding me?”
Marcus and Diamon and the small .01 per cent of the one per cent they are part of are not kidding about fighting back either. The protesters may piss them off, but they are fighting a deeper trench warfare now against regulators and central banks who say they want to save them from themselves.
Comments David Dayan on the website Firedog Lake:
|It should come as no surprise that this coterie of self-pitying “job creators” lines up pretty perfectly with right-wing Republicans and free-market fundamentalists. Just because this attitude completely crashed the economy about three years ago doesn’t mean they should be made to feel bad about it, however.|
He cites an article on the Roman Empire which says that, even with all its slaves, it had a more equitable income distribution than the US has today. Writes Tim DeChant:
|To determine the size of the Roman economy and the distribution of income, historians Walter Schiedel and Steven Friesen pored over papyri ledgers, previous scholarly estimates, imperial edicts and Biblical passages. Their target was the state of the economy when the empire was at its population zenith, around 150 CE. Schiedel and Friesen estimate that the top one per cent of Roman society controlled 16 per cent of the wealth, less than half of what America’s top one per cent control.|
Keeping wealth concentrated seems to be what the bankers do – but sometimes with enough excess and irresponsibility to bring themselves down.
In Washington, the Federal Reserve Bank, ironically founded and run by the very banks who have been blessed with secret subsidies in the trillions, fears another financial crisis driven by a banking crisis.
They want American banks to hold more capital – and to keep it more easily accessible. According to the New York Times, they have already compromised with pressure from their clients, adding that “the final capital rules were unlikely to be more stringent than international limits that were still under development. That is a small victory for banks who warned that they would be severely disadvantaged if capital requirements here were stricter than those governing overseas banks.”
Meanwhile, overseas, the same battle royale is underway. In England, regulators are considering new rules that would outlaw investment banking by commercial banks. This is the very problem that America’s Glass-Steagal Act was passed to prevent in the l930s.
When that law was “modernised” – ie dumped as unnecessary – by Congress with Bill Clinton’s blessing, the banks rushed into the game of largely unregulated speculation with disastrous consequences clear for all to see.
The international regulators have their own too big to fail list of 29 banks they call “G Sifis” to insure higher capital levels. The risky banks that first opposed the designation, are now using it to market themselves as safer. Go figure!
While many in the world support a tax on financial transactions, the US bank lobby has killed it here. They also colluded with subprime lenders, and before them, red-lining discriminatory lenders to scalp borrowers and promote fraudulent loans with little push back by politicians who were clearly bought off.
In Switzerland, Europe’s bank capital, a central banker trying to make the industry more prudent has come under sustained personal attack by his colleagues.
The New York Times reports:
Mr (Phillip M) Hildebrand, the president of the Swiss central bank, was called “arrogant” and “egotistical” by bankers quoted anonymously in the pages of Swiss newspapers. His supposed sin: Wanting banks to hold extra capital. The fact that Mr Hildebrand was himself a former hedge fund manager in New York seemed only to heighten the sense that he had betrayed his profession.
“He’ll never find another job in Switzerland”, the Swiss newspaper Der Sonntag quoted an unnamed high-ranking banker as threatening Mr. Hildebrand in 2010.
The unusually bitter attacks on a central bank chief were a measure of what was at stake. Mr Hildebrand, 48, had a high-visibility role in a struggle between bankers trying to preserve their most lucrative business practices and regulators trying to defuse a system that, many believe, nearly blew up the world economy.
This very public food fight offers a window into why bankers are fighting – and often winning their war on politicians and the public. They are relentless in pursuit of their interests and have the ability to pay for the best law firms and PR flacks.
The bankers are trying to come with theories for our depressing economic woes that places the blame on everyone but them. Fedhead Ben Bernanke says it was all a “global savings glut” that did us in. Hence, anyone that was more of a saver than an investor is responsible.
Hyun Song Shin, another Princeton professor, says bullocks to his colleague Benanke in a detailed paper refuting his strawman, arguing the crisis was caused by “a ‘global banking glut’, ie the rise in cross-border lending, than the ‘global savings glut’.”
Without falling down the rabbit hole of endless well-footnoted debates, the truth is that millions of savers have seen their savings shrink and most bankers, thanks to bailouts and cheap money, watched their holdings rise.
Blaming the victim for the crime has a long and dishonourable history,
As bad as the economy gets, and most forecasters suggest little hope for a rebound in the year ahead, even as there are blips of “positive data”, the bankers seem determined to save themselves if and when the ship sinks.
They already own the lifeboats.
The challenge facing the 99 per cent is how to organise more broadly and build the political muscle to break up the big banks, dissolve the “zombies” (failed banks on borrowed time) among them and rebuild an economy that works for all of us.
News Dissector Danny Schechter blogs at NewsDissector.com. His film Plunder exposes financial crime On Wall Street. (Plunderthecrimeofourtime.com) His latest is Occupy, a collection of his reporting on Occupy Wall Street.
The views expressed in this article are the author’s own and do not necessarily reflect Al Jazeera’s editorial policy.