The Business of America Is Kleptocracy
It's hard to miss these days. The headlines tell the story—repetitively. Everyone, it seems, is on the take. The Securities and Exchange Commission has charged Goldman Sachs with securities fraud for creating and selling "a mortgage investment that was secretly intended to fail"—and then betting against its own customers. JPMorgan Chase which, in a pinch in 2008, happily took taxpayer dough, just reported $3.3 billion in profits for the first quarter of 2010, a jump of 55% over the previous quarter. The bank set aside $9.3 billion in what's called "compensation and benefits" for its employees in 2009.
Even when they lose, they win. According to James Kwak of the Baseline Scenario website, on a deal in which JPMorgan swallowed $880 million in losses, its bankers still managed to walk awaywith up to $10 million in compensation. As he wrote, "JPMorgan's bankers did just fine, despite having placed a ticking time bomb on their own bank's balance sheet." Meanwhile, Robert Rubin, who helped create the world that led to the 2008 financial meltdown as Treasury Secretary under Bill Clinton, then took a top position at Citibank and made more than $100 million before it tanked on his watch. As economist Dean Baker puts it, "In the fall of 2008, when Citigroup was saved from bankruptcy with a taxpayer bailout, Rubin quietly slipped out the back door (with his money), resigning from his position at Citigroup." Only recently Rubin made the headlines for offering the least apologetic (non-)apology imaginable for taking the American people to the cleaners.