How exactly do you ‘lose’ $2-6 billion dollars?
Gambling? Addiction? Memory Loss?
Unfortunately for JPMorgan CEO & Chairman Jamie Dimon, the public hasn’t forgotten the nauseating numbers tossed around during the fiscal crisis that began in 2007 and resulted in a $700 billion taxpayer-funded bank bailout in 2008. So we weren’t very happy to hear JPMorgan Chase announced last week that the finance giant had suffered a Britney Spears moment and “oops!” lost somewhere between $2-6 billion on risky trading.
Five years ago, few of us outside the rule-twisting world of finance would have twitched if someone goofed up and lost big bucks. But these days, when it comes to “too-big-to-jail banks”, the 99% is very wary. Now when the public hears news about big banks squandering enormous quantities of money through risky trading and reckless bets, we brace ourselves. We wonder if we will be told once again that we have to foot the bill for another bailout to JPMorgan and watch our hard-earned tax dollars funneled into big banks while CEOs put their feet up and rake in bailouts, tax cuts, and bonuses.
After all, this is the same JPMorgan that received $94.7 billion in bailout money four years ago and went on to lobby even more heavily after receiving bailout funds.
When we give the big banks big bailouts, taxpayers are actually funding a coup of our own democracy.
JPMorgan Chase spent $5.4 million on lobbying in 2008, $7.6 million lobbying in 2011, (and just last week approved a $23 million dollar pay package for CEO & Chairmen Jamie Dimon). Besides investing lobbying cash to get a big chunk of the bailout, JPMorgan Chase also continues to rail against the exact type of regulation that would have prohibited the type of reckless trading that nicked somewhere between $2-6 billion off its tally sheet last week.
In 1933, following the stock-market crash of 1929 that precipitated the Great Depression, the Glass-Steagall Act was enacted in order to protect our economy by separating investment and commercial banking activities. Glass-Steagall was repealed in 1999, not to the chagrin of JPMorgan, which had spent millions over decades of lobbying for a repeal of the legislation.
Turns out, some rules aren’t made to be broken. Last week’s OOPS moment has sparked several lawmakers calling for resuscitating Glass-Steagall and for Jamie Dimon to step down from his Board Member position at the Federal Reserve.
But JPMorgan didn’t stop at defeating Glass-Steagall. Since the Glass-Steagall repeal ‘victory’ in 1999, CEO Jamie Dimon has become the poster boy for banksters whining about the ‘oppression’ of regulation, throwing money at Washington almost as often as he throws tantrums about having to play fair and follow rules.
Now, the Wall Street bulls have been working to gut the newest piece of rational regulation: The Dodd-Frank Wall Street Reform and Consumer Protection Act. Obama signed Dodd-Frank into law in 2010, promising us “There will be no more taxpayer-funded bailouts. Period.” Unfortunately, we still aren’t safe from Wall Street’s crazytrain. Matt Taibbi’s recent article details the “The Slow Painful Death of Dodd-Frank” and cites none other than JPMorgan’s CEO and chairmen Jamie Dimon as one of the bulls leading the charge against Dodd-Frank and other efforts to regulate a reckless Wall Street.
“Ever since the start of the banking crisis in 2008, Dimon has been arguing that more government regulation of Wall Street is unnecessary. Last year he vehemently and loudly opposed the so-called Volcker rule, itself a watered-down version of the old Glass-Steagall Act that used to separate commercial from investment banking before it was repealed in 1999, saying it would unnecessarily impinge on derivative trading (the lucrative practice of making bets on bets) and hedging (using some bets to offset the risks of other bets).” –Former Secretary of Labor Robert Reich
Risky trading on derivatives is exactly what lost JP’s $2 billion. That’s a lot of crow to eat. But good ol’ Jamie doesn’t think twice about it. At the JPMorgan Chase shareholder meeting last week (yep, the same one where his $23 million pay package was approved), Jamie said, “It is time to admit mistakes… and move on.” Easy for you to say, Jamie. You’re not the one paying for JP’s “mistakes”, bonus boy.
As long as big banks dispatch lobbyists to write policies and then bankroll election campaigns so those in office sign those policies into law, we the 99% will continue to be prohibited from having the ability to regulate these money mongers. We need to take the keys away from those who are driving our economy into the ground.
So, speaking of designated officials, you may be surprised to hear this (or not) but many of our officials in Congress are actually literally invested in JP Morgan’s success: dozens of members of Congress are JP Morgan shareholders.
According to OpenSecrets.org data, which is based on personal financial disclosure forms filed by all members of Congress for the year 2010 (disclosure forms for 2011 were due this week, but aren’t yet publicly available), 15 Democrats and 23 Republicans owned shares in JPMorgan Chase worth a total of between $2.1 million and $3.8 million.
Do you see a conflict of interests here?
Are legislators effectively clear-minded enough to regulate an industry when that industry is making them millionaires? Does this personal investment impact their approval of policies that protect big banks at the expense of a safe market? Even without the personal bottom line, big banks fund Congressional dependency on the finance sector through campaign contributions and revolving door lobbyists.
JPMorgan made over $6 million in campaign contributions in the 2008 election. The corporation has already dished out over $1 million this year, and the party is just getting started.
As long as this corporate coup of our democracy continues, the finance sector will continue along, unfettered, in burning the economy to feed its greedy fire. It’s time to Elect Democracy instead of corporate puppets so that we can stand up to Wall Street bullies and protect the rest of the country from the finance sector’s erratic behavior.
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