Wall Street loves socialism for bankers, but not for ordinary people — JPMorgan CEO Jamie Dimon decries socialism. Unless of course it’s the banks that need a government bailout

by User_Name13

Insane levels of hypocrisy here from JPMorgan CEO and bankster-extraordinaire Jamie Dimon.

This has been the playbook in America for the wealthy the past 40 years:

Privatize the gains, socialize the losses.

Us taxpayers pay to bailout bankers and banks, but no one is going to do the same for the poor, average American who has to do declare bankruptcy due to medical bills brought on by our inherently exploitative and rapacious healthcare system.

God forbid the government actually look out for the health and well being of its actual real, living citizens and not just it’s corporations.

The sad thing is we already have socialism in the US, but only for the military, defense contractors and fortune 500 multinational corporations, in the form of subsidies that are funded by the taxpayer. If you are a fossil fuel corporation that pollutes the Earth or a bank that engages in irresponsible predatory lending practices or a defense corporation that builds weapons of war to kill other human beings, then the US government has nothing but socialism for you.

But if you are just a regular, average poor American, who is living paycheck to paycheck the way the majority of the country is, all the government has for you is lectures on personal responsibility and bootstraps.

 

via theguardian:

In his annual letter to shareholders, distributed last week, JPMorgan Chase CEO Jamie Dimon took aim at socialism, warning it would be “a disaster for our country,” because it produces “stagnation, corruption and often worse.”

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Dimon should know. He was at the helm when JPMorgan received a $25bn socialist-like bailout in 2008, after it and other Wall Street banks almost tanked because of their reckless loans.

Dimon subsequently agreed to pay the government $13bn to settle charges that the bank overstated the quality of mortgages it was selling to investors in the run-up to the crisis. According to the Justice Department, JPMorgan acknowledged it had regularly and knowingly sold mortgages that should have never been sold. (Presumably this is where the “stagnation, corruption and often worse” comes in.)

The $13bn penalty was chicken feed to the biggest bank on Wall Street, whose profits last year alone amounted to $35bn. Besides, JPMorgan was able to deduct around $11bn of the settlement costs from its taxable income.

To state it another way, Dimon and other Wall Street CEOs helped trigger the 2008 financial crisis when the dangerous and irresponsible loans their banks were peddling – on which they made big money – finally went bust. But instead of letting the market punish the banks (which is what capitalism is supposed to do) the government bailed them out and eventually levied paltry fines which the banks treated as the cost of doing business.

If this isn’t socialism, what is it?

Yet it’s a particular form of socialism. Millions of homeowners who owed more on their homes than the homes became worth didn’t get bailed out. Millions of workers who lost their jobs or their savings, or both, didn’t get bailed out. No major banker went to jail.

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Call it socialism for rich bankers.

It’s a gift that keeps giving. Dimon took advantage of the financial crisis to acquire Bear Stearns and Washington Mutual, vastly enlarging JPMorgan. America’s five biggest banks, including Dimon’s, now control 46% of all deposits, up from 12% in the early 1990s.

And because they’re so big, Dimon’s and other big Wall Street banks are now considered “too big to fail”. This translates into a hidden subsidy of some $83bn a year, because creditors who face less risk accept lower interest on deposits and loans.

More socialism for rich bankers.

After the financial crisis and bailout, Congress enacted a milquetoast version of the Glass-Steagall Act, a banking law from the Great Depression that bankers killed off in the 1990s. The replacement was called the Dodd-Frank Act.

Ever since, Dimon has pushed to weaken Dodd-Frank.

When Obama’s regulators wanted to extend Dodd-Frank to the foreign branches and subsidiaries of Wall Street banks, Dimon warned it would harm Wall Street’s competitiveness.

This was the same Jamie Dimon who chose London as the place to make highly risky derivatives trades that lost the firm some $6bn in 2012 – proof that unless the overseas operations of Wall Street banks are covered by US regulations, giant banks like his will move more of their betting abroad, hiding their wildly-risky bets overseas so U.S. regulators can’t see them.

 

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