Goldman Sachs’ $500 Million Mea Culpa

Cannibal-CapitalismIt’s truly touching that Goldman Sachs’ CEO Lloyd Blankfein, who recently said that his too-big-to-fail, Fed-backed holding company is doing “God’s work,” has offered a mea culpa (of sorts) for his firm’s past sins. Our beneficent overlords at Goldman Sachs promise to bestow upon small business a boon of $500 million. This generous sum is about 3 percent of the $16.7 billion that Goldman has set aside for its employees this year — a year of expected record-breaking profits on Wall Street.

Goldman has also retained the services of the high-powered international PR firm, Brunswick, to make sure that all of us understand that even a vampire squid can be magnanimous. Brunswick has among its ranks the public affairs director and the chief of staff of former Treasury Secretary Henry Paulson. “Brunswick is a corporate communications partnership,” its home page states. “We provide informed advice at a senior level to businesses and other organizations around the world, helping them to address critical communications challenges that may affect their valuation, reputation or ability to achieve their ambitions.”

Goldman Sachs is going to need all the PR help it can get. At this point, the company (which Jon Stewart of The Daily Show calls “Gold Man-sack”) would be far more popular among the public if it specialized in clubbing baby seals and whaling. Just wait until the lawsuits filed by six municipalities and counties against the company reveal the extent of our noble masters’ criminality. The suits claim that Goldman Sachs ripped off institutional investors, such as the Sacramento Municipal Utility District, by rigging the market for “municipal derivatives.” What’s at stake in this litigation is far more than $500 million.

I’m afraid not even the good name and homespun bona fides of Warren Buffett can turn this sow’s ear into a silk purse. Goldman Sachs should probably follow Blackwater’s lead and “re-brand” itself by changing its name. Even the miracle workers at Brunswick won’t be able to sell stealing from local governments as “God’s work” to the public. There’s really no better example of Goldman Sachs’ utter contempt for the American people than its swindle in the form of stealing public funds through manipulating the municipal bond market. The AIG bailout saved Goldman billions of dollars and the Fed continues to back its risky ventures now that it is a “holding company.” This institution deserves the full force of anti-trust law deployed against it. Maybe in open court we’ll get a glimpse into the real workings of this unworthy amalgam of greed and arrogance.

Somewhere in all these contradictions and misplaced priorities should be a lesson for Governor Schwarzenegger as he returns to California. Someone might ask him (as well as his like-minded fellows in Washington) why he only values public institutions if they are being built with tax dollars six thousand miles away.

Joseph Palermo

Originally published by the Huffington Post. Reprinted with permission from the author

Published by the LA Progressive on November 23, 2009
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About Joseph Palermo

Joseph Palermo is Professor of History, California State University, Sacramento. Professor Palermo's most recent book is The Eighties (Pearson 2012). He has also written two other books: In His Own Right: The Political Odyssey of Senator Robert F. Kennedy (Columbia, 2001); and Robert F. Kennedy and the Death of American Idealism (Pearson, 2008). Before earning a Master's degree and Doctorate in History from Cornell University, Professor Palermo completed Bachelor's degrees in Sociology and Anthropology from the University of California, Santa Cruz, and a Master's degree in History from San Jose State University. His expertise includes the 1980s; political history; presidential politics and war powers; social movements of the 20th century; the 1960s; and the history of American foreign policy. Professor Palermo has also written articles for anthologies on the life of Father Daniel Berrigan, S.J. in The Human Tradition in America Since 1945 (Scholarly Resources Press, 2003); and on the Watergate scandal in Watergate and the Resignation of Richard Nixon (CQ Press, 2004).