"Everything is context-driven. After ten benign years in the context of where we were...How would you look at the risk of a hurricane? The season after we had four hurricanes on the East Coast, which was actually extraordinary versus the year before, rates got very low... that year after 4 hurricanes... rates went up spectacularly... Is the risk of hurricanes any different any of those times?"
-Lloyd Blankfein, CEO of Goldman Sachs, January 12, 2010
It is true that our economy was hit by hurricane Mr. Blankfein, but it was one created by you and your cohorts. The financial services industry lobbied for the repeal of the Glass Steagall Act in 1999. That allowed banks to use their custodial power over your money to assume huge risks in investment markets.
They also lobbied for the Commodity Futures Modernization Act of 2000, which allowed banks to trade their crooked insurance in secret and exempted from all supervisory authority. And to help grow the hurricane, then CEO of Goldman Sachs Hank Paulson made a personal plea to the SEC to allow banks to leverage more money against their capital. As much as $4,000 for every $100 in capital they held.
Wall Street may claim this was caused by a perfect storm, but the only thing perfect about it was their ability to line their pockets at the expense of our country. Look at just the past few years of compensation for some of the CEO's testifying today. Numbers that don't even include the expected record-breaking 2009 bonuses.
- $410 million for Goldman Sachs CEO Lloyd Blankfein over 3 years
- $195 million in that timespan for JP Morgan CEO Jamie Dimon
- $132 million for just two years work at Morgan Stanley for John Mack
Brian Moynihan has just stepped into his role as CEO of bank of America. But he stands to do just fine. His predecessor Ken Lewis made $150 million for 5 years before stepping down. Unfortunately for the rest of us, their man-made money-making hurricane has devastated this country.
Ten percent of this nation is out of work. Real unemployment stands at 17.3 percent. The deficit has skyrocketed over the past ten years. Our national debt now more than $ 12 trillion. More than 2 million families have lost their homes to foreclosure in the last 3 years, and seniors are denied interest on their savings, just so banks can receive tons of cheap money to try to gamble their way out of their hole.
So to you hurricane-makers, we say it's time for you to come clean on your actions, let us fix your crooked system and finally pay us back for your destruction. Today, Morgan Stanley CEO John Mack and JP Morgan's Jamie Dimon talked about clawbacks they've instituted for their banks to recoup future losses but what about the clawbacks for the bonuses you made over the past 10 years? The ones you made on the massive fraud that the American taxpayer is currently paying for?
Not to mention, the record-breaking bonuses to be awarded next week gambling with our bailout money. Take a listen to Mr. Mack's justification during a recess this morning. Potentially record profits Mr. Mack but they are clearly the result of a windfall of taxpayer support. So it only makes sense that this country follow the lead of Great Britain and France and enact a windfall profits tax.
Look at it this way: If we found out Katrina was the result somebody's get-rich quick scheme, wouldn't we demand restitution?