Posts Tagged ‘banks’

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According to USA Today [ht: sm],

Even as Wall Street braces for more cuts to jobs and bonuses, JPMorgan Chase CEO Jamie Dimon was paid $27 million in 2015, up from $20 million the year before, the company said Thursday.

The pay raise comes after JPMorgan announced record annual profits last week, thanks to cost-cutting that helped to offset stagnating revenue growth.

JPMorgan’s board paid Dimon a $1.5 million salary, a $5 million cash bonus and $20.5 million in performance-based stock grants, the company said in a regulatory filing.

Last year, Dimon was paid a $7.4 million cash bonus and $11.1 million in stock awards. His $1.5 million salary has remained unchanged.

Whenever a commentator declares that “politics is the art of the possible”—and proceeds to make whatever arguments they deem necessary to delegitimize ideas that challenge the current common sense—I’m on my guard. What we’re being told is to accept present conditions as immutable facts of life, and to trim our goals accordingly. We’re being told not to entertain ideas that point in the direction of the not-yet possible.

So it is with Paul Krugman these days. Now that Bernie Sanders has to be taken seriously, Krugman has taken to invoking the art of the possible and, in the process, both rewriting history and declaring that Sanders’s plans represent deceitful fantasies.

In order to make a thinly veiled case for Hillary Clinton against Sanders, Krugman has decided that Too Big to Fail Banks—Bank of America, JPMorgan, Citigroup, Wells Fargo, and Goldman Sachs—which now long after the crash are all Too Bigger to Fail—played no significant role in 2008. Instead, the problem, as Krugman (citing Mike Konczal) sees it, was shadow banking. While breaking up the big banks might not solve all the problems of the financial sector, it’s simply disingenuous to try to whitewash the history of the crash of 2007-08 by arguing that the nation’s largest banks played only a marginal role in creating the conditions of the bubble that eventually burst and, when it did, in bringing the world economy to its knees.

If the art of the possible with respect to financial reform is one or another version of Dodd-Frank, it’s extending private health insurance to cover more people—and decidedly not proposing a single-payer (let along a single-provider) plan. Here, Krugman relies on Ezra Klein to assert that Sanders’s plan is a fantasy, since it relies on cost-savings associated with government setting health reimbursement fees (like the current Medicare system) and it would mean disrupting the existing, private insurance system. And, of course, we can’t have that.

The fact is, Krugman (along with Konczal, Klein, and many others in recent days) is determined to make the American electorate stick to existing policies and policy options, which don’t disrupt business as usual. That’s the art of the possible, as proposed and practiced by Clinton.

What Sanders and his growing number of supporters are relying on is our disenchantment with the existing possibilities, which put us in the Second Great Depression and left too many Americans without decent healthcare, and a desire to make strides that challenge the current common sense and help us imagine the next steps.

That’s politics as the art of the not-yet possible.

Or, alternatively, we can just let Juan Perón take over.

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In Iceland [ht: ra], by the end of 2015, 26 high-level bankers had been sentenced to a total of 74 years in prison.

It’s a move that “would make many capitalists’ head explode if it ever happened here.”

In the United States, all the major Wall Street financial firms nicknamed Too Big To Fail banks—Bank of America, JPMorganChase, Citigroup, Wells Fargo, and Goldman Sachs—have paid out settlements for illegal conduct in the mortgage-security markets that caused the 2007-08 crash. However, no individual executives have gone to jail or even faced prosecution for that conduct.

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In fact, according to report from researchers at Syracuse University, during 2015, federal prosecution for white-collar crime fell to a 20-year low.

The available records show an overall decline that began during the Clinton Administration, with a steady downward trend — except for a three-year jump early in the Obama years — continuing into the current fiscal year.

During the first nine months of FY 2015, the government brought 5,173 white collar crime prosecutions. If the monthly number of these kinds of cases continues at the same pace until the end of the current fiscal year on September 30, the total will be only 6,897 such matters — down by more than one third (36.8%) from levels seen two decades ago — despite the rise in population and economic activity in the nation during this period.

The projected FY 2015 total is 12.3 percent less than the previous year, and 29.1 percent down from five years ago.

Addendum

The argument in the United States has been that prosecuting and jailing banking executives would have disrupted the financial sector and the economy as a whole.

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While the recovery in Iceland from the financial crash has been anything but smooth, it’s still the case that unemployment has fallen to 4 percent and wages have been rising at an annual rate of 6.2 percent.

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