This is what happens when banksters rule your country.
New York City Mayor Michael Bloomberg visited Goldman Sachs Group Inc. (GS)’s headquarters in Manhattan in a show of support after a departing employee publicly criticized the firm’s culture yesterday.
“The mayor stopped by to make clear that the company is a vital part of the city’s economy, and the kind of unfair attacks that we’re seeing can eventually hurt all New Yorkers,” said Stu Loeser, a spokesman for the mayor.
“Unfair attacks”?? Just to be clear, what the resigning midlevel exec in the GS London office said in his New York Times op-ed was that the culture at Goldman Sachs was such that its clients were being bilked by trading schemes knowingly designed to rip them off, while the GS execs laughed about how gullible their “muppet” clients were for trusting them. That was shocking, but it wasn’t unfair or news, because that’s essentially what we’d already been told, in sworn testimony. It’s what Senator Levin’s hearings and investigations found, what the SEC found in the case it settled, and what the Financial Crisis Commission found in its investigation and final report.
Goldman’s vultures should be shunned in polite company, even evoking the “good grief, I’m running for President!” statements from the likes of Mitt Romney, even though some of his best friends are vultures. But apparently those rules don’t apply to Mayor Bloomberg. A mid-level exec reveals the GS culture is led by a bunch of thugs who bilk their clients and laugh about it behind their backs, and the billionaire Mayor of New York feels he needs to give the thugs a hug because their fee fees (literally) might be hurt?
In a rational country, that would end a politician’s career, but it won’t in today’s America. Instead we get to shake our heads in disbelief amidst rumors that Bloomberg may replace Tim Geithner as Secretary of the Treasury. (And never mind that Larry Summers, who helped defend Wall Street deregulation and argued during Dodd-Frank that TBTF banks are needed, is now being considered to run the World Bank.) How reassuring that the man being considered for Treasury is someone who knows the value in having a Wall Street fully capable of tanking the world economy, defrauding whole nations, looting their clients, putting millions out of work, and . . . getting away with it.
Meanwhile, Tim Geithner was busy with a misdirection of his own, explaining that while it was politically unpopular, bailing out the banking system was necessary to avoid a depression. So brave Tim courageously did it anyway.
He reiterated his view that, around the time of the financial crisis, the public probably would not have supported the bailouts for banks that helped cause the crisis. But Mr. Geithner added that past financial crises had been made worse by governments that failed to act with appropriate force because they were afraid of doing something that was unpopular.
True, but a misdirection.
Most of Geithner’s critics give him and Bernanke credit for rescuing the financial system, per se, but fault them for leaving the criminal banksters in charge of that system and then allowing only watered down rules in Dodd-Frank for reining them in. The beef is they’ve done precious little to change the industry’s most harmful practices and incentives. The TBTF banks are now more consolidated, bigger and more powerful than before.
You can’t tell whether this is an ideological blind spot or just being disingenuous. Geithner is deflecting the issue, conflating the essential financial functions of the banking system with the banksters who manipulate it and their personal financial incentives. You can argue the Feds had to push trillions into the system to avoid a total depression, but they didn’t have to leave the criminals in charge of it. So the crooks are still in charge, and as we’ve seen in the mortgage fraud cases they continue their criminal activities. Yet no one is being prosecuted.
The lesson is clear: Have you hugged your GS overseers today? They’re very sensitive.