“It’s Certainly Not For A Lack Of Effort”

The fundamental divide in opinion regarding our financial system is: Are the people running “large integrated financial groups” hapless fools, buffeted by forces beyond their comprehension and control; or do they know exactly how to ensure they get the upside and the awful, sickening downside is borne by society – including through high unemployment.

Some light was shed on this issue by Monday’s meeting at the White House or, more specifically, by who didn’t turn up and why.  Of the dozen bank CEOs invited, Vikram Pandit was supposedly busy trying to extricate Citi from TARP and asked Dick Parsons to attend instead – a wimpy but smart move, as Parsons is close to the President.

However, three executives – Lloyd Blankfein, John Mack, and Dick Parsons himself – did not show up in person and had to join by conference call.  Their excuse was bad weather (fog) in DC meant that they were unable to fly in; Mack was quoted as saying, regarding their absence, “It’s certainly not for a lack of effort“. 

But really there are three possible interpretations:

  1. Pure bad luck.  This happens to us all; even the best laid plans are for nought sometimes.
  2. Bad management by the executives and their logistic teams – who are ordinarily the best of the best.
  3. Wilful defiance of the government which, while not premeditated in this instance, means that the executives grabbed an opportunity to show disrespect and relative power.

We don’t know all the facts of how these executives planned to travel or exactly their routes on Monday morning – and I would be happy to be corrected on any details – but here’s what we can readily construct from the public record.  (We do know they didn’t try to come down Sunday evening, because that would have worked.)

President Obama held a press briefing after his meeting with the bankers, starting at 12:36pm.  The meeting itself lasted a bit over an hour.  As we all like to start meetings, particularly important meetings, on round numbers, it seems fair to assume that the appointment at the White House was for 11am.  Even VIPs need some time to clear security, so let’s assume that the CEOs were asked to arrive by 10:30am.

All three of the missing bankers were apparently coming from New York.  There are many ways to make the flight, but US Airways is among the most reliable – flying from LaGuardia to National Airport, every hour on the hour, from 6am.  The flight takes just over an hour, it’s easier to get to LaGuardia from Manhattan before 7am, and delays are common at LGA as air traffic builds up over the east coast.  Any conservative banker, who really did not want to be the only person missing a meeting with the president, would aim for the 7am shuttle – putting him on the tarmac in DC at 8:10am, with a comfortable time cushion (and an opportunity to have coffee with his chief lobbyist).

There was thick fog in DC on Monday morning, but this did not descend in a matter of seconds during rush hour – it was evident already by 5am.  Corporate jets could get through (Jamie Dimon came that way), but let’s limit ourselves to public transportation – remember that the Acela train service is not generally slowed by fog and on Monday ran almost on time.

So the question becomes: At what point did the CEO realize that there was a fog issue, and was there still time to come by train?  The Acela leaves Penn Station every hour on the hour, with the 7am train getting to DC at 9:49am and the 8am arriving at 10:49am.

We can rule out explanation #1 (bad luck).  These are experienced people who travel all the time, with first class support staff, and they are supposed to be the best in the timely information business.  These executives don’t generally wander around airports trying to puzzle out flight information displays.

Is explanation #2 plausible (bad management)?  It is possible that at least one bank team wasn’t paying close attention and sent their boss to the airport for the 7am shuttle (although what are the odds that this would happen for 3 of our biggest and most dangerous banks?)  An experienced traveller, who has checked in on-line, might aim to arrive at the airport at 6:30am – to discover the delays already in progress.

So then the question becomes: Can you get from LaGuardia to Penn station in 90 minutes early on a Monday morning?  My experience is: Yes (if any New Yorkers know differently or if anyone saw John Mack pushing desperately through the crowds at Penn Station just before 8am Monday, please post or send that information in).

The implication is inescapable.  These three bank executives did not plan on missing the meeting but, once they learned of the fog delay, they did not rush to the train station – which is what any other business traveller with a pressing commitment would have done.

These three executives – who were, in some sense, the primary audience for the president’s remarks – did not really want to attend.  They do not see the need to show deference or even respect.  They won big from the crisis and that is now behind them.  As they move on (and up), there is nothing – in their view – that the executive branch can do to hold them back.

Even so, it wasn’t polite to behave in this fashion; showing disrespect to the President of the United States is always objectionable.  But there is a pattern of behavior here, reflecting a deeper culture on Wall Street.  This arrogance will eventually prove their undoing – no self-respecting White House can let this kind of repeated insult pass unaddressed.

By Simon Johnson

69 thoughts on ““It’s Certainly Not For A Lack Of Effort”

  1. This was my analysis as well. They didn’t premeditate not going, but also didn’t feel like going and certainly felt no need to go out of respect or fear.

    So they were happy to let the first mild obstacle thwart them. “Whoops, looks like I can’t go!” (and you’re really relieved). I know the feeling personally.

    We already saw their contempt for this clown back in September when they blew off his puling little lecture right there in Manhattan. Why would they care about listening to his whining now? Obama merits disrespect and contempt.

    I doubt they would’ve tried pulling anything like this with Bush or even Clinton. Bush was banker-friendly, but he also wouldn’t stand for personal disrespect.

    Cohen’s book said there was a story that Jimmy Cayne blew off Bush once, and hinted that maybe that played into how the administration let Bear go down.

  2. The meeting was just a political stunt on the president’s part anyway, so the president could scold the fat cats and look like he’s actually doing something when he’s not.

    It is not like the bankers are shrugging off the administration’s noble efforts to change things. This administration serves at the pleasure of Wall Street. The only difference of opinion here is that the president wants people to think otherwise and the bankers really could care less what the masses think.

  3. Are the people running “large integrated financial groups“ hapless fools, buffeted by forces beyond their comprehension and control; or do they know exactly how to ensure they get the upside and the awful, sickening downside is borne by society – including through high unemployment.



  4. Imagine doing this to Lyndon Johnson. President Obama needs to put the fear of God in people. Bill Moyers said on his show last night that no one in Washington fears Obama. Washington and the Pentagon would be two good places to start and then he can move up the coast to NYC, just like that Nor’easter we’re getting.

  5. Google Maps confirms that public transit (including the bus!) will get you from LGA to Penn Station in just over an hour. I’d love to see Blankfein hanging on the A train…

  6. It’s becoming more apparent as various policy proposals by the White House wind through Congress, that Pres Obama himself lacks spine, doesn’t like conflict, and is coming around to the embarrassing notion that he might have been a little too naive during the campaign about working in the style of bipartisanship and “coming together as a nation, one people….” The Left leaning Obama watchers like Robert Kuttner (on Bill Moyers Journal last evening) are disillusioned because they project too much of their own wishes onto the President. If Pres Obama and the Dems survive the 2012 elections, I believe he will take a more “progressive” approach but there’s little evidence up to now, to support the notion that he is on their side.

  7. In your first sentence you link to Brooks’ Op-Ed from April, suggesting that you endorse his argument. I remember well being annoyed by his piece at the time it was published. He sets up a two narratives and uses your article to illustrate one aspect and Muller’s article as the other. I think its a false dichotomy.

    I felt that your article wasn’t essentially about greed, as Brooks wants us t beleive, it was about power. Frankly, I’m greedy, but my greed is irrelevant because I have no power. Its not the greed that is the problem you identified, its the unchecked power. Similarly, stupidity isn’t the main take away I got from Muller’s article. So Brooks’s division is in my opinion bogus.

    The reason for the bogus set up is so that he can claim that there are two approaches as to what to do. You have argued for strong intervention to break up the big financial firms. For partisan or ideological reasons, Brooks cant abide by that so Brooks claims that there is a different path — Brooks wants to convince the public that the banks just need to be “nurtured and recapitalized” so he claims that “The stupidity narrative suggests we should preserve the essential market structures.”, even though the Muller article does not support this statement.

  8. The argument of hubris and/or poor manners on behalf of bank management is a valid one. However justifying such behaviour directed toward and elected official is hardly a justification for government action.

    The implied argument if extended would mean that any citizen not showing the proper respect to an elected official should be singled out for special action.

    The very concept of liberty vs. tyrranny is the ability to disagree with governing powers and was the foundation of the US.

    While distastful and showing a lack political savvy or couth the non-violent actions of private citizens should never be the justification for extra judicial government action against those individuals or the organizations which they represent.

    The significant changes needed to the banking system should be about public safety and economic stability, not retribution. Acting on false beliefs and emotions such as ego are probably some of the things that precipitated the current issues to begin with.

  9. Perhaps the next time some charismatic nobody comes out of nowhere and runs on his ability to crystallize the fantasies of mass man by talking nonstop about himself, fewer people will be fooled?

    Want to bet?

  10. “… or do they know exactly how to ensure they get the upside and the awful, sickening downside is borne by society – including through high unemployment”[?]

    I think a valuable case study of this hypothesis, though not in the banking industry, could be made of Jacques Nasser, the former CEO of Ford Motor Co.

    Nasser drove up the price of Ford stock (in the short term) and the value of his bonuses but cutting quality — internally, this was called taking cost out of the vehicle in places where the customer would not notice it.

    In the most notorious case, this led to the undersized tires on the Explorer that caused rollover accidents in hotter parts of the country. In the end, a number of people were killed, and the small savings achieved through the use of cheaper tires cost the company $12 billion.

    Long term gains in quality at Ford before Nasser were reversed to achieve of short term profits in order to drive the stock price up. After Nasser left Ford product quality had to rebuilt from the ground up. The long term success of Ford, while still uncertain, depends on continuing and deepening the quality process that have turned Ford from the weakest of the Detroit Three to the only one to see gains in market share.

    The Ford family’s ownership position in the company motivates them to ensure the long-term success of the company motivates them to protect the interest of the enterprise, something that is missing in companies dominated by stock holders who don’t have much power over CEO dominated boards.

    That’s why the incentives for executive compensation must be changed.

  11. irresistible … “The stupidity narrative suggests we should preserve the essential market structures.”

    So if I leave an attractive nuisance like a firepit smoldering brightly in my back yard, and some drunk teenager comes along and falls into the pit on a midsummer night, that suggests I should preserve the un-fenced firepit? That seems to be the logic behind the quoted statement.

  12. … also, there is a fourth interpretation.

    4. It’s good to keep the hired help in their place. Particularly that annoying minstrel boy whose purpose is to distract the public from one’s business while pretending to limit that business.

  13. I suppose there once was a time when the concept of America as a country and a community meant something. Sadly, commentary like this and our experience of the last several years has destroyed that illusion. And yet we send those men and women to war to defend our way of life even as we acknowledge that our way of life is vile and corrupt.

    It’s facinating anyone would bother to defend us. How naive they are.

  14. Why would they go to aeeting they cannot dominate and certainly cannot win at. These people are highly adversarial at all times. I have never met an American go getter that was not adversarial. Now, peope can fake out being go getters for awhile after they rise to their level of maximum competance. All three of these guy’s are traders. Would you go to see the President without a payback? Many maintain that the President is the minion of the big Wall street elites. That is not the reality. The reality is that financial and political elites are different factions that must endure commonwealth between themselves even if it breaks down on occasion. So, all three must have been conflicted about going for a “sit down” among equals since Wall streeters are the faction on the ” outs”.

    In short , all of the above. Can you imagine the private discussion between Mack,Blankfein and Parsons? Think of Tony Soprano and his allied Capo Regime’s.

  15. These CEO’s are sending a message that they’ve bought the president and don’t need to do his bidding. He needs to do theirs.

    Until the US gets the money out of politics through mandatory public funding of campaigns and prohibiting sideline money, as well as locking the revolving door, we will be under the thumb of an oligarchy.

    Hayek’s “road to serfdom” was not through socialism but rather corporate statism. He was looking in the wrong direction — backward instead of forward. As a result he failed to see what was staring us in the face. The US is now in the hands of a corporate mafia.

  16. Are the people running “large integrated financial groups“ hapless fools, buffeted by forces beyond their comprehension and control; or do they know exactly how to ensure they get the upside and the awful, sickening downside is borne by society – including through high unemployment.

    This is a false dichotomy as well. They can be both blithering incompetents* in their financial professions, while at the same time being expert at privatizing the gains and socializing the losses.


    *It’s also possible that the “buffeting forces” are overwhelming and beyond anybody’s comprehension and control. I just happen to prefer considering them incompetent.

  17. Paul Krugman made the suggestion that liberals who are upset with the compromises they made on health care should use financial reform as a way to even the score. i agree.

    A core of 15 or 20 hard core liberal senators could wreak havoc for the administration by demanding the strongest possible bill–a bill that truly sticks it to the banking industry. I, for one, will not be pleased with any bill that the banking industry signs off on. So I say bring out the legislative equivalent of the pitch forks. Personally, I’d like to see Blankfein and friends sent into exile to shovel manure on a hog farm in southern North Dakota in the winter. But that won’t happen. Let’s do the next best thing and squeeze them really, really hard.

  18. “….no self-respecting White House can let this kind of repeated insult pass unaddressed.”

    Oh, please don’t count on it being addressed. As you say, that’s only for self-respecting White Houses.

  19. What part of bought and payed for do you not understand?

    Unfortunately the pathetic serfdom of this nation has not suffered enough to object to tyranny.

  20. Well, we don’t TELL the 18 year olds this. D’uh. We wait until well after you’re past peak enlistment age before we tell you that what you’re really dying for is so that the President can buy time until after the 2012 election before he has to find some “moderate Taliban” to surrender to. If we told ’em this in high school, the President might not get re-elected.

    Hey, what? It worked for Richard Nixon.

  21. The action that would take place is removing of preferential treatment, not real punitive actions. The condition you fail to include is that these banks exist in current form because of government assistance. If I help you, and you treat me like dirt, don’t expect further assistance.

  22. “no self-respecting White House can let this kind of repeated insult pass unaddressed.”

    This is all theatre; in this case the weather served as a device for improv. The bankers couldn’t give a rat’s behind about anything but themselves, and Obama knows this and plays along. All laughs and good cheer around.

  23. Obama has got to where he is by being a team player, that’s all he knows how to do. He never intended to rock the boat, he just wanted to ride in the captain’s cabin.

  24. None at all. The guy’s just a front, and that’s all he ever aimed to be. A willing sock puppet.

  25. On a ceratin level it’s just theater. Obama’s not interested in putting up real fight with the bankers, he and the bankers just want it to look like he his. If the bankers had just gone to the meeting the dramatic tension would have been missing and the inteneded result (i.e. nothing) would make appearances even more lame and corrupt.

  26. It would be so very interesting if Nancy Pelosi were Head of Government, the Prime Minister to the Head of State. President Obama then would be Head of State only, a very limited office. Harry Reid would be the leader of our version of the Lord’s. Affirm the House and Confirm state offices.

    How different our system would have evolved if the Founding Fathers had not had the issue of thirteen sovereign states in Federal Union on their plates at the same time?

    Thanks for the links, Tim Coldwell.

    If our system were the same as Britain, would the government fall if the ruling party did not tax bonuses one-off as will now probably happen in both Britain and France?

    I would love to see a double one-off excise tax on bonuses just to see how Congress would agonize and temporize. Say 40 % on the payor and 40 % on the recipient on top of income taxes. We would quickly see who the bought dogs of both houses of Congress are. They would be truly squeezed should such a bill emerge from committee in both the House and Senate.

    Wall Street has bought both parties. But, political expediency would rule if such proposals made it out of Committee.

    I hope I caught all the typos and such. I am using a new computer for the first time.

  27. There is no level of humiliation our popular leaders, as opposed to our more invisible ones, are not willing to take. Let’s look at Colin Powell. The bright shining star of the “smart advisors” millions used as an excuse to vote for Bush.

    By election day Cheney’s knife was already visible in Colin’s back yet Colin went down to the ranch for the obligatory ‘we are in charge’ photo. For the next 2 plus years Colin was bad mouthed, shit on and at best ignored, but he still went before the UN to give Bush his war. Powell is still popular and for all I know still thinks he is a whatever people think he is. and Prince Bandar gave him a classic Rolls. So too Obama.

  28. In this day and age of Broadband, it’s a bigger mystery why people are shuffling around in trains and planes for a 1-2 hour meeting. It would be so much easier on everyone to simply “link up” and not go through all of this hassle ..

    It’s difficult to believe that everyone involved in this meeting didn’t have the best telecom services at his/her disposal that money would buy.

  29. A self-repecting White House, ha ha. Obama is too green to understand when he’s been humiliated. He’ll never know what hit him when the electorate turns on him as a bought-and-paid-for weakling.

  30. THE TRAIN?!! I think suggesting it would have been like suggesting wire hangers to Joan Crawford.

  31. I read a lot of the comments, but I didn’t see where anyone suggested that the President currently is as much of a figurehead in our country as the Queen in Great Britain. Nice house, nice palace, no real power at all. And, in England, no one would miss a visit with the Queen, but then they believe in at least form and manners, here, form and manners are meaningless, just like morality. Especially for the real ruling class. Trains, shmains, they planned alternative activities all along, and didn’t care how it looked, because when you got the country by the short ones, who cares?

  32. We have utter lunacy in action like when governments appoint financial regulators who use credit risk ratings issued by credit rating agencies to decide how much equity banks need to have, presumably so that the banks won´t fail and the governments will not have to bail them out, though they must know that the rating agencies, when rating the risk of banks, explicitly measure the government´s willingness to bail out the bank.

    We have Gillian Tett reporting in FT December 18 that “the Europeans banks are now net sellers of insurance against the chance of their own governments going into default – even though those same banks are implicitly backed by those governments”

    We have a regulatory system that in many countries ordains the banks to hold equity when lending to an ordinary citizen but allows for zero capital when lending to the government and thereby leveraging even more the power of the state.

    For each day that goes by the markets become increasingly dependent on what the Frankenstein monsters of the financial market, the credit rating agencies opine.

    And here we are busying ourselves… with gossip?

  33. Only 25% voted for it, and many if not most of those did because they believed a lie, that this person represented “change” and would fight corporatism.

    (That’s of course what each and every issue boils down to by now, the issue of our time: does a proposal help or hinder corporatism? is one for or against corporatism?

    That’s the question being answered by anyone’s position on the health racketeering bill.)

  34. I think we’re overestimating the contribution of these guys being ‘experienced travellers’. These are all guys who are used to traveling by private jet, but have been forced to change tack because of political pressures (am I wrong here?), so it seems plausible to think that pushing through the crowds towards the train station wouldn’t be the first thought on anybody’s mind. (Though I take the point that if they were feeling competitive about seeming *on board* with the president, more thought might have gone into how to get to the meeting while some other invitees did not.)

  35. How many candidates haven’t run with slogans “Hope&Change”? What puzzles me is that one election after another substantial portion of Americans are willing to hope that this time it’s different. Well, it never will be. Hoping will change nothing. Only actions can bring change, but you can’t do that by watching tv. You actually have to get out there and do work.

  36. Pretty sad, when the only leverage we have on these bankers, is discussing why they did not show up for a meeting with the President.

  37. “…no self-respecting White House can let this kind of repeated insult pass unaddressed”. So, where is this self respecting White House? From all appearances it does not exist because the Corporatist have taken control of the Government.

    Stunning, the way we were deceived into believing that Obama intended to deliver “Change” to America. A look at the health insurance bill and the total lack of financial reform not to mention the continuing Bush tax cuts on the Ubers and the Bush wars establishes the intent of this White House.

    Catering to the Ubers is far more important than working for the people, not mention any quaint notions of self respect.

  38. Bernanke and Geithner create the biggest moral hazard that the bad people get reward from government’s help but the good people get punishment from higher tax, higher cost of living (reducing public benefit like education, healthcare and any infrastructure) and higher inflation (now inflation is high from too much loosening policy). At the end, everyone will be bad and need help and no one will be good because if you are good, you will get only punishment and this will create the bigger crisis because of moral hazard creation by Fed and Geithner.

    Look at money that government and help spend, they use money to give to Goldman Sach, Citi etc by injecting money at cheap cost, no corporate tax and a lot of support from Fed but ordinary people get no job and no support and get higher tax and higher expenditure. Government and Fed know only wealth transfer and the fiscal and monetary policies are to help the wall street and there is no way they think to help people. Job creation is not the first priority of Obama’s policy but the first is Wall street, wealth of investor and the rich. If they want to create job, they need to transfer wealth back to people to have more income and more purchasing power. They should tax financial sectors and stop support any privilege like cheap funding cost to Goldman Sach, Citi etc. and use that money to help the American people.

    A lot of economists forecast next year is the year of global government-funding crisis from too much spending and most spending benefits the rich. Now government should have the policy to tax the rich and the people who cause the crisis including banking, Wall Street and the speculators to fund the poor and middle-class people. This can help the stability of economy and avoid funding crisis.

  39. I read an article by Kuttner before the Dem primaries in which he stated that he liked some of what Obama was saying, but that he more or less expected to be disappointed.

    In short, Kuttner just doesn’t like neo-liberalism–and he’s one of the few Dem Party associated commentators who is consistent in that.

  40. It’s not about Greed

    There are between 7 and 14 articles and blogs a day all identifying the crisis of 2008, CEO behavior and bankers bonuses as all about greed. We are quickly moving towards an accusatory cultural position that if one gets too much (a relative term) then one is filled with greed. It is similar to the diagnosis of narcissism that has been grossly misused and misapplied. Misused to the degree where if one is selfish or lacks empathy or takes more, one is called a narcissist. This places the accuser in the position of blaming those who have more and fails to understand what motivates them to engage in this behavior.
    What brought about the banking crisis in America was not about greed, it was about the pathological need to increase one’s status. Studies have demonstrated that high levels of testosterone do not necessarily lead to a macho man hell bent on being aggressively consumptive but a man excessively focused on status, filled with envy, and an overwhelming desire to have what the other guy has. Consider this: At a “gin and tonic” party at a mansion of a successful banker an attendee reported the following. “After I got my drink our host led us to his greenhouse and showed his magnificent collection of valuable and delicate orchids. It was his hobby and he would travel the world collecting rare and exotic plants. Upon return to the house I could not help but notice two sets of women; an old or original group of wives at one end of the large room and a group of trophy wives at the other end, nervously eyeing each other.” What drives these men to engage in one-upmanship is not greed — but one-up-man ship status. They see their colleagues with a more expensive car, they start thinking about getting a one, they see a colleague with a jet and they have to have one too, they see a colleague with a beauty and they want one. Houses, cars, wives, art, orchids, watches, office, etc.; these are status symbols and for these men they are exceedingly important. They become a measure of their self worth. The parties, the country club, the university club, the yacht club, and the workplace are all places where executives parade their stuff. Many suggest this is nothing more than narcissistic characters impressing others to obtain love. But this may not be the case. They live and work within a culture that is status driven and issues of exclusion and inclusion are associated with the attainment of status. In this culture those who have more create envy and they aggressively engage in the struggle for ever higher status. The “my d–k is bigger than yours,” is ever present. The truth of the matter is underneath they believe they will always an inadequate d–k.

  41. Sigh.

    (I’m still waiting to hear a coherent explanation of the political utility of that defeatist/contemptist stance. I’ve asked people several times.)

    1. I think after 8 years of the Bush nightmare people might’ve invested the old words with a little more energy than before.

    2. There was indeed something new with Obama, this highly motivated grassroots organization composed mostly of the young. All the commentators were wondering, once he’s in office, what’s he going to do with this force? Deploy it as a bottom-up force outside of the government and the Democratic party structure? (That’s certainly what I would have done with it.) There was certainly tremendous energy there to be mobilized.
    Who knew they’d stomp on it instead?

    3. I know technocrats like you despise the people I just talked about and want to tell them to shut up and give up, that they’ll just be slaves forever and there’s nothing they can do about it.

    Well, tough. I’m going to keep telling them they were lied to, that they should be angry, that they can never trust this utterly corrupt establishment, and that they should take all their good will and channel it into a new movement.

    So however much the likes of you try to demoralize others, I’m going to say there’s nothing wrong with them, and there was nothing wrong in being wrong about Obama, that he’s the one who lied, and the system lied, and he’s wrong, and the system’s wrong.

    The BANKS are the enemy. Corporatism is the enemy. So if the people were fooled, that means they were the victims, and they have a right to redress.

    That’s the only politically and morally true way of looking at it. It is tyranny, and when you deny it’s tyranny, you side with tyranny.

  42. If Obama isn’t nice to the people looting the US economy, then the money flowing to Democrats dries up, and we start seeing Congresses getting 60 or 70 pct majorities in the form of these Republicans who pander to the (large) feral / ignorant elements of American society / voters.

    There ain’t no mystery here. This is a decaying nation happily eating its seed corn.

  43. Alexander Hamilton wanted to give the wealthy a permanent stake in our government .. “to unite the interest and credit of rich individuals with those of the state” – some historians now question whether a foreign agenda was served when Hamilton established the first central bank and undid the Revolution by giving those bankers a “proprietary” interest in our government.

    Opposite Hamilton was Jefferson and likeminded neighbor John Taylor of Viriginia, who shared Jefferson’s vision of a free society: “wealth, like freedom, must be considerably distributed to sustain a democratic republic … As power follows wealth, the majority must have wealth or lose power”. They envisioned this fair distribution of wealth in a nation of landowners – and saw Hamilton’s Central Bank as a threat to private property “by which the rich plunder the poor, slow and legal”. Today Hamilton’s rich one per cent have more wealth than the lower ninety-five per cent, proving Jefferson adn Taylor right.

    In Taylor’s mind, the succession of privileged orders through history – the priesthood, the nobility, now the banking system -showed how every age had known its own form of institutionalized robbery by a minority operating through the state. Priesthood and nobiity had been overthrown in America; but no one, Taylor warned, should think America had thereby won immunity from tyranny. The invention of a second form of property, which Taylor called “artificial” or “fictitious” – i.e., paper money banking – now enabled the aristocracy to prey systematically upon hardworking Americans.

    The current banking crisis with its artificial and exotic paper instruments of speculation and over-leverage and its too-big-to-fail banks, would all be a case of “I told you so” for Taylor and Jefferson.

    As for the attitude of today’s bankers, compare to Nicolas Biddle as he defended his central bank against Jackson: “no officer of the government, from the president downwards, has the least right, the least authority, the least pretense, for interference in the concerns of the bank”.

    Biddle lost his war with Jackson, something that would not happen today even if Obama were so inclined. We have our aristocracy – the money changers, the high priests of the market place – and they own our government. To think otherwise is naive. To get a great majority to understand this fact and to unite in cause against it, is probably also naive. But it is the only chance for real freedom.

  44. Are the people running “large integrated financial groups“ hapless fools, buffeted by forces beyond their comprehension and control; or do they know exactly how to ensure they get the upside and the awful, sickening downside is borne by society – including through high unemployment.

    If they’re so dumb, how come they’re rich?

  45. JerryJ – I like the part towards the end where Andy Haldane refers to the number of people and teams working on a new “plan” for banking (internationally) would “make your hair curl”:-). My guess is that plenty of them are in the USA, not just Europe.

  46. You omit the very real possibility that the airline was saying….just wait a few more minutes, we are sure the fog will clear…trust us….

    Some irony that they relied on the only entity with worse performance to get to a meeting to discuss their own performance.

  47. Guess I need a new handle, you’re using mine or possibly I used your’s when I first commented here 8 months ago.

  48. A good demonstation of the relative power of aristo-cracy versus demo-cracy. Unfortunately as Morgan said something about highering fighters, the propects are severe for collateral damage.

  49. I’m reminded of the wagon (tumbril?) that would be used to transport people to the guillotine…..

  50. Perhaps the next time some uncharismatic nobody comes out of nowhere and runs on his ability to crystallize the fantasies religous zeolots and flag-waving nationalists by talking non-stop about his born-again revival, his burning desire to eliminate taxes on his rich buddies, and to drop bombs on third world peasants, fewer people will be fooled?

  51. Beware though of a charismatic nobody coming out of nowhere running on his ability to crystallize the fantasies of all his it´s-always-someone-else´s-fault-religionaries and flag-waving nationalists by talking non-stop about his born-again revival, his burning desire to tax all the rich and to drop bomb on the imperialists, as many people will still be fooled.

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