Our financial system is horribly broken, serving only the well-connected and well-monied interests of Wall Street. We, the American Taxpayer, gave billions of our dollars to save people who made stupid bets on gambles designed to make them millions and millions of dollars. We haven’t flinched yet but if the republic has a chance of recovering, we’re going to have to do something about it.
From Bill Moyers Journal January 8th, 2010:
“Thanks to taxpayers like you who generously bailed banking from the financial shipwreck it created for itself and for us, by the end of 2009 the industry’s compensation pool reached nearly $200 billion. And despite windfall profits, the banks will claim almost $80 billion in tax deductions. And nearly $20 billion of those deductions will go to just three institutions — Morgan Stanley, JP Morgan Chase, and Goldman Sachs.
Ah, yes — Goldman Sachs, that paragon of profit and probity — which bet big on the housing bubble and when it popped — presto! — converted itself from an investment firm into a bank so it could get your bailout money. Now consider this: in 2008, Goldman Sachs paid an effective tax rate of just one percent. I’m not making that up — one percent! — while their CEO Lloyd Blankfein pulled down over $40 million. That’s God’s work, if you can get it. And, believe me, Wall Street bankers know how to get it…”
Did you read that? Goldman Sachs paid an effective tax rate of ONE PERCENT. This is the change we have been given. Short change indeed. Why we haven’t risen up and destroyed these people, either figuratively or literally, is beyond me. They are sucking the life blood out of America and calling it God’s work.
They are doing it because we let them. You do have some choice. Let your representatives know that you will not stand for it. Better yet, take any and all money you have in major banks and move them to small community banks as part of the Move Your Money movement. I will be opening an account with American National Bank of Texas today and closing my Chase account as soon as I can. I refuse to continue to support institutions who do anything they can to disadvantage me the customer while lining their pockets with my tax money. If you do not do what is right, you will continue to suffer the painful consequences of what is wrong.
Hat Tip: Jesse. If he isn’t in your daily reading list, you are missing out on commentary exactly describing what is going on in our financial and political system.
Won’t the big banks just buy our little banks once they become bigger?
I half-expect the little banks to start acting like the big banks, too. It’s extremely profitable, and there’s no reason for them NOT to, besides principles.
I guess we’ll see.
While it is easy to succumb to the cynical dark side, I still have some bone in my body that says this will all turn out ok. It’s a really small bone though.
The big banks can’t possibly buy all the little banks. There are literally hundreds of small community banks in any decent size metropolitan area. If mine gets bought, I’ll move to another one.
And I would argue that they have very little reason to act like the big banks. Small to medium sized community banks rely heavily on the relationships they build within the community. At American National Bank of Texas, where I just got a checking account, 5 people walked in while I was there and the tellers knew the first names of 4 of them. That’s impressive. Big banks can treat you like crap because of their volume. Small banks don’t have that luxury.
Then, I only question the ability of the small banks to conduct business over the net. I’m moving my biz account to Frost, and will soon find out. But I simply have got to be able to pay bills online and receive payments online, and do so simply. I get that from Chase, and I worry about Frost.
Yeah, that’s been my biggest concern for switching. I have a huge list of people/things/bookies I pay with online banking and I agree, Chase gets that part right. I’m hoping ANB of Texas does as well.
i suppose it’s possible, additionally, that smaller banks simply do not have same resources with which to take the monstrous risks the larger institutions do. it could be as simple as that responsible investment and behavior is a sort of resource-governed issue with them.
huh. that’s a very sunny-side-up-cynical view of things for you.
I think that’s also true, that without the economy of scale that a Chase has, smaller banks can’t do the same things. Of course, that’s a two edged sword.
Yes, it’s my New Year’s Resolution to be only be sunny-side up cynical instead of hard-boiled cynical. That will probably last through February.
I believe the “God’s work” line is from the commentator, and he’s being just a teeny bit sarcastic.
Frost seems to have a personal banking website, so it would appear that they have your concerns covered.
Actually, the “God’s work” comment originally came from Lloyd Blankfein who claimed to be doing God’s work at Goldman Sachs which is exactly what you would expect to hear from an egomaniac partially responsible for our current economy.
I don’t know about Frost but American National Bank of Texas is pretty slow about setting up online access, I’m still waiting for my log in info a week later. I guess that’s one of the drawbacks of going local and small.