Virtuous Bankers? Really!?!

By MAUREEN DOWD

WASHINGTON

The Great Vampire Squid has gotten religion.

In an interview with The Sunday Times of London, the cocky chief of Goldman Sachs said he understands that a lot of people are “mad and bent out of shape” at blood-sucking banks.

“I know I could slit my wrists and people would cheer,” Lloyd Blankfein, the C.E.O., told the reporter John Arlidge.

But the little people who are boiling simply don’t understand. And Rolling Stone’s Matt Taibbi, who unforgettably labeled Goldman “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money,” doesn’t understand.

Banks, Blankfein explained, are really serving the greater good.

“We help companies to grow by helping them to raise capital,” he said. “Companies that grow create wealth. This, in turn, allows people to have jobs that create more growth and more wealth. It’s a virtuous cycle. We have a social purpose.”

When Arlidge asked whether it’s possible to make too much money, whether Goldman will ignore the people howling at the moon with rage and go on raking it in, getting richer than God, Blankfein grinned impishly and said he was “doing God’s work.”

Whether he knows it, he’s referring back to The Protestant Ethic and The Spirit of Capitalism — except, of course, the Calvinists would have been outraged by the banks’ vicious — not virtuous — cycle of greed and concupiscence.

Blankfein’s trickle-down catechism isn’t working. Now we have two economies. We have recovering banks while we have 10-plus percent unemployment and 17.5 percent underemployment. The gross thing about the Wall Street of the last decade is how much its success was not shared with society.

Goldmine Sachs, as it’s known, is out for Goldmine Sachs.

As many Americans continue to struggle, Goldman, Morgan Stanley and JPMorgan Chase, banks that took government bailout money after throwing the entire world into crisis, have said they will dish out $30 billion in bonuses — up 60 percent from last year.

The saying used to be, whatever happens, the lawyers win. Now, it’s whatever happens, the bankers win.

Under pressure from regulators, who were trying to ensure that long-term performance was rewarded, the banks agreed to award more in stock, deferring cash payments.

But as The Times reported this week, the Goldman executives who got stock options instead of bonuses last year, at market lows, got a windfall — so it had nothing to do with bank employees’ performance.

“The company gave its general counsel, for example, 104,868 stock options and 14,117 shares in December, when the bank’s stock was around $78,” Louise Story wrote for The Times. “Now the bank’s shares have more than doubled in value, making that stock and option award worth nearly $12 million.”

As one former Goldman banker told Arlidge, the culture there is “completely money-obsessed. ... There’s always room — need — for more. If you are not getting a bigger house or a bigger boat, you’re falling behind. It’s an addiction.”

It’s an addiction that Washington has done little to quell. President Obama has not been strong on the issue, and Timothy Geithner coddles the wanton bankers whenever they freak out that they might not be able to put in their new pools next summer.

The bankers try to dismiss calls for regulation as populist ravings, but the insane inequity of it cannot be dismissed.

No sooner had the Senate Banking Committee Chairman Chris Dodd announced his plan to overhaul financial regulation Tuesday than compensation experts declared it toothless.

The banks and their lobbyists wheedled concession after concession out of Washington and knocked down proposed inhibition after inhibition. Now the banks are laughing all the way to the bank.

“Saturday Night Live” was tougher on Goldman Sachs than the government, giving the firm flak about commandeering 200 doses of the swine flu vaccine — the same amount as Lenox Hill Hospital got — while so many at-risk Americans wait.

“Can you not read how mad people are at you?” demanded Amy Poehler. “When most people saw the headline ‘Goldman Sachs Gets Swine Flu Vaccine’ they were superhappy until they saw the word ‘vaccine.’ ”

Seth Meyers chimed in: “Also, Centers for Disease Control, you sent the vaccine to Wall Street before schools and hospitals? Really!?! Were you worried the swine flu might spread to the Hamptons and St. Barts? These are the least contagious people in the world. They don’t even touch their own car-door handles.”

And as far as doing God’s work, I think the bankers who took government money and then gave out obscene bonuses are the same self-interested sorts Jesus threw out of the temple.

Democrats who want 30 percent credit card rates

I've been posting some stories on the Senate defeating the cap on credit card rates at 15%, a very fair rate in these times, or any. They want it to stay at a usurous 30%, a rate which, in times previous to Reagan's usherance in of deregulation, may have been illegal if not usurous. These were rates that were once only found with loan sharks, and street corner thugs who kept families in debt to them, calling favors for those debts. It's right out of The Dead End Kids.

Now, these Senators are protecting their states where Credit Card companies and banks operate without supervision, free to do as they please. Those states are Delaware, South Dakota, and Connecticut. among others.

Thanks you (tongue in cheek) Senators Chris Dodd, John Thune, Tim Johnson (South Dakota), Tom Carper, Ted Kaufmand (Delaware) and lone Democratic Rep Stephanie Herseth Sandlin of South Dakota for joining the Republicans to soundly defeat such a bill that would actually help the consumer. It is now clear who represents the banks.

Perhaps, as I note those states looking for help from the rest of us - such as Delaware wishing for money to aid its film industry - it is up to the rest of us to call our Senators and Representatives to let them know we are watching their votes on such bills to see if there is some sort of line that says "We're for the consumer, not the banks, who already make so much on our backs."

Carper helps banks kill credit card rate cap

Kaufman also votes against 15% limit to protect consumers

By NICOLE GAUDIANO
News Journal Washington Bureau, Delawareonline

WASHINGTON -- A plan for a national cap on credit card interest rates was defeated Wednesday by the Senate.

The proposal to cap rates at 15 percent would have been a significant change for Delaware, which hasn't had usury laws on the books since they were abolished in 1981.

"In a free-enterprise system, I'm not sure that [interest rate caps are] what we need to do," said Sen. Tom Carper, D-Del. He and Sen. Ted Kaufman, D-Del., were among 60 senators who voted to block a vote on the measure, offered as an amendment to a larger credit card reform bill.

However, Democratic Sen. Chris Dodd of Connecticut, chairman of the Senate Banking Committee, said Wednesday's vote shouldn't be interpreted as a rejection of the concept. An analysis of which rate caps would be appropriate for which institutions under which financial circumstances would be helpful, he said.

"It's a confusing issue, except for the fact that most of our constituents and millions of Americans would like to see some restraint," Dodd said. "I don't know how you possibly could explain why some institutions get away with rates that are literally triple digits."

The American Bankers Association opposes rate caps, as well as the overall credit card reform legislation, expected to come up for a vote in the Senate this week. It says the bill would jeopardize access to credit. But consumer groups say it would put an end to abusive practices.

The Senate bill is considered to have stronger protections for consumers than either legislation that passed the House last month or Federal Reserve regulations. It would give consumers 45 days' notice before rate increases and allow them to pay by phone without additional fees. It would prohibit rate increases in the first year after a credit card account is opened, prohibit interest charges on paid-off balances from billing in the previous cycle, and protect young people from aggressive solicitations.

Unlike the House bill or Fed regulations, the bill would prohibit retroactive interest rate increases until an account is 60 days past-due. It also would be implemented in nine months. The House bill would take effect in a year. The Fed's regulations would take effect by July 1, 2010.

President Barack Obama has strongly advocated credit card reform and has asked to have legislation on his desk by Memorial Day weekend