MOTHER JONES journalists David Corn and Kevin Drum offer a hard look at the obstacles to real reform of the financial industry.
http://www.ritholtz.com/...
Goldman Sachs Corporate Tax Rate = 1%
Thanks to taxpayers like you who generously bailed banking from the financial shipwreck it created for itself and for us, by the end of 2009 the industry’s compensation pool reached nearly $200 billion. And despite windfall profits, the banks will claim almost $80 billion in tax deductions. And nearly $20 billion of those deductions will go to just three institutions — Morgan Stanley, JP Morgan Chase, and Goldman Sachs.
Key Excerpts:
DAVID CORN: Wall Street has become a place- and the banking industry, where you don’t lend money to improve local businesses and industry. You basically, you know, create new- they call them instruments, devices- to make money yourself. It’s really turned into nothing except a casino, in which they lend money and then they make bets and side bets and bets on the side bets about what’s going to go up and down. So, a lot of the action is really, at the end of the day, not about providing credit and keeping capital flowing. It’s about what- how they think they can make more money through more trades.
DAVID CORN: And so, when I was talking to members of Congress and pollsters about why there was not more popular, you know, revulsion against Wall Street that was leading to action in Washington, Congressman Brad Sherman — he’s a Democrat from California. He led during the whole TARP argument- what he called the skeptics caucus. They were kind of opposed, but they were just raising questions. And he says the problem is that people are told that if you don’t serve Wall Street, Americans will be out on the streets fighting for rat meat. That basically the whole-
BILL MOYERS: Rat meat?
DAVID CORN: Rat meat. Those- that’s his- those are his words, not mine. I never- think I never would come up with that. With that image. But that- basically, we’d all be out fighting for grub on our own. And that so- what happens is people are — while they’re angry at Wall Street, particularly on the, you know, on the corporate compensation front, which is very easy to get angry about. They also are fearful of taking Wall Street on, because they’ve been taught that if, you know, if the DOW falls, if you take on the big banks, it’s going to be bad for all of us. So, it really is this Stockholm Syndrome, where we’re forced to identify with people who are holding us hostage without our interest in mind.
KEVIN DRUM: And remember one thing is that over the last 20-30 years, people have been told over and over and over again that the economy is doing well. The economy’s doing great. The Dow is up. And yet, they themselves, most of them, aren’t actually making more money. Median wages have hardly gone up at all in the last 30 years. So, you’ve got all these people who aren’t really making any more money. They’re treading water. And yet, everywhere they turn, they’re being told the economy’s doing well. And they start, I think, a lot of people start to blame themselves. They wonder, "If the economy’s doing so well, how come I’m not doing better? It must be me." And what they don’t see is, no, it’s not them. It’s the way the system works.
BILL MOYERS to DAVID CORN: No one can read your piece in "Mother Jones" without thinking, "So, these guys must be laughing all the way to the bank." I mean, the same people who, bought the government off, brought the economy down, caused suffering to millions of people from Orange County to Portland, Maine, are winning all over again, you say. Because, you say, in the same issue, no one’s fighting back.
DAVID CORN: My guess is that they feel they dodged the biggest bullet of their lives. I mean who would have thought a year ago that we’d be back we’d be at this point? I mean, I think they probably, you know, worried that, you know that that there’d be communist laws passed. You know, that people would be so angry.
Net Net: Too many Mericans are dumb, complacent, or just cannot sort through all the spin so with the massive amounts of lobbying and $$$ to our Congressitters, who care only about themselves, it really was a cakewalk for GS and friends.
IMO if Obama does not wake up and do tangible financial reform including getting rid of Geithner, Summers, Bernanke ( + other Obama economic asslowns ) then he is gone in 2012.