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Banks Lose Control of the Optics

Joseph Palermo: If JPMorgan Chase and the rest of the money cartel cared one whit about people perceiving them as being slightly more tolerable corporate citizens, they would have long ago voluntarily offered a lifeline to underwater mortgage holders and to local governments.

The mainstream press has been predictably abysmal in its coverage of the Occupy Wall Street protests. Andrew Ross Sorkin, one of the “money honeys” over at the New York Times, looks at the demonstrators as anthropological curiosities, as if they’re from a remote tribe in Papua New Guinea. The Times’Ginia Bellafante calls the protesters “ideologically vague and strategically baffling,” who are doomed to failure even though they’ve received the blessing of what she calls “the left’s ruling class,” (Michael Moore, Naomi Klein, and Susan Sarandon). Who would have known the “left” has a “ruling class?”


The only reason the press covered Officer Anthony Bologna’s pepper spraying of those non-resisting young women was because it was caught on video. Even the liberal Nicholas Kristof displays his lack of insight when he offered the group his unsolicited advice for a demand: “Close the Carried Interest and Founders’ Stock Loopholes!” (I’m sure down at Zuccotti Park right now people are writing that on placards.)

There are precious few voices in the news media suggesting breaking up the big banks through anti-trust enforcement, slapping windfall profits taxes on them, or dusting off the RICO (Racketeer Influenced and Corrupt Organizations Act) statute to put some of the perps behind bars.

Still, the optics are pretty bad for the big banks.

If JPMorgan Chase and the rest of the money cartel cared one whit about people perceiving them as being slightly more tolerable corporate citizens, they would have long ago voluntarily offered a lifeline to underwater mortgage holders and to local governments. Yet their campaign donations, lobbying activities, and predatory practices in abusing their “customers” (like Bank of America’s recent fee hike or Jamie Dimon’s big donation to the New York Police Department) show that these behemoths have no intention of reforming themselves. Instead, they intend to continue to give the country the shaft thinking themselves immune to the public’s wrath by virtue of the immense piles of money they control — which is precisely the problem, isn’t it?

What those corporations on Wall Street and their enablers in Washington did to the country was unconscionable. Now New York Mayor Michael Bloomberg is putting out the tired line that bosses always use to divide workers whenever strike actions are called: “It’s such an inconvenience to the little people! Those unions should be ashamed of themselves!” Bloomberg is just reminding us that he’s just another billionaire whose setting up the PR discourse for an act of repression against the protesters.

The pressure from those “rudderless” protesters on Wall Street, sometimes called “spoiled brats,” helped strengthen the spines of New York Attorney General Eric Schneiderman and California Attorney General Kamala Harris to push back against the Obama Administration’s efforts to cut a sweetheart deal with the banks. Schneiderman and Harris stopped attorneys general from little states, like Iowa’s Tom Miller and others, from being accomplices in covering up the banks’ multiple felonies. (Last year Harris won a squeaker of an election, which is a reminder that even in a huge state like California every single vote matters.)

Back in May 1986, the Wall Street financier, Ivan Boesky, famously told the U.C. Berkeley business school commencement: “I think greed is healthy.” Eighteen months later, he was convicted for insider trading, sentenced to three years in prison, and fined $100 million. As part of Boesky’s plea deal with federal prosecutors, he gave up Michael Milken as a co-conspirator.

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The business press naturally had fallen in love with Milken, calling him “the premier financier of his generation” (Fortune); “the chief architect of America’s corporate restructuring” (Forbes); and “probably the most influential American financier since J.P. Morgan” (The Economist). Milken’s creative accounting in the context of a deregulated Wall Street greased the wheels for corporate raiders to engage in a wave of leveraged buyouts (LBOs) and hostile takeovers that piled up unimaginable profits and commissions. LBOs were particularly damaging to the real economy because they entailed buying companies and then selling them for parts like a chopped stolen vehicle. The financiers made out like bandits while the workers lost their jobs and their pensions when the companies were liquidated.

Even during the height of the Reagan Revolution federal authorities used RICO, normally aimed at mafia titans, to prosecute Milken. He pleaded guilty to six felonies of conspiracy and a host of tax and mail frauds and was sentenced to ten years in prison. Although Milken served less than two years he also paid what was then the biggest single fine in American history: $900 million. Boesky and Milken became the poster boys for the shady deals and widespread “control frauds” that were taking place on Wall Street throughout the 1980s. Their criminal convictions marked an end to an era of fast money and high-stakes gambling that had put the “real” economy at risk and were a factor in the October 19, 1987 stock market crash.

If the feds under Reagan could prosecute a couple of corrupt high rollers on Wall Street, why can’t they do it under Obama?

The dominant ideas of any industrial society are those of its ruling elites. Terrible ideas — such as “trickle down” tax cuts, deeming corporations “people,” or deregulating everything — drench us like a relentless thundercloud opening over our heads. No matter how damaging these ideas are to the well-being of our society, as long as they come down from on high they’ll be ventilated widely and establish the parameters of “acceptable” public discussion.

This hegemony of ideas that serve power is why even “liberal” voices inside the news media cannot comprehend what’s taking place near Wall Street. The nonviolent occupiers in their tents and sleeping bags are creating a subaltern culture, a workers’ culture; the culture of the other 99 percent. They don’t need a 13-point plan of specific demands. (And if they had such a list they’d be denounced for being overly rigid and ideological). What they’re doing is far bigger and more significant than an itemized set of grievances. If you can’t figure out what they’re saying then you’re not really listening.

When a U.S. Senator stands up in the well of the Senate and says that the bankers “own this place,” it should ring alarm bells among our political class and even pundits who claim to care so much about America. Where were the Peggy Noonans or the Thomas Friedmans or the David Brookses when Senator Dick Durbin of Illinois made that sweeping admission? They’re full of advice for working people to follow, but on the Senate controlled by Wall Street and a Supreme Court that uses chicanery to turn corporations into persons, we hear not a peep from these gatekeepers.

The Occupy Wall Street demonstrators most likely at some point will be cleared out, tear-gassed, and clubbed into relinquishing their liberated territory as was the case with the Bonus Army of veterans that occupied Washington in 1932. The economic depression that started in 1929 had awakened protest movements just as our current depression has sparked the occupation of Wall Street.

But even if the protest is repressed this great endeavor of building of working-class culture that represents the aspirations and interests of the other 99 percent will have taken a huge stride forward. With labor unions, students, workers, the unemployed, the elderly, mortgage holders, and veterans working together to confront the centers of ill-gotten wealth and power that have run amok on Wall Street, the wider movement representing the other 99 percent is destined to grow.

Joseph Palermo

Joseph Palermo

Joseph Palermo
Joseph Palermo's Blog