matt taibbi

Matt Taibbi called Goldman Sachs a "giant vampire squid," and it appears that they've finally overstepped their bounds.

How much senior executives earn, in cash and stock, is public information. How they make it is public too. Trouble is, the two are barely brought together in reporting. One story's a business story, the other's, well, for the "human interest" file. As all humans have a reason to be interested, let's pull the pieces of one tale together. Let's take Wells Fargo, the bank whose CEO just topped the charts -- as the top earner in the country for 2009. According to analysis released by Equilar, an executive compensation research firm, Wells Fargo CEO John G. Stumpf was paid a personal best of $18.7 million in cash and stock in 2009. That's up 64 percent from two years earlier. That means that Mr. Stumpf is making twice as much as Lloyd C. Blankfein, his counterpart at Goldman Sachs -- the "great vampire squid" himself. Does that make Stumpf Mr. Super Squid... ? More names might come to mind if the public were reminded of just what's been going on at Wells Fargo on his watch. The company is currently being sued by, among others, the city of Baltimore, for civil rights violations related to racist lending practices. As we've reported on this program, Wells Fargo made a bundle, selling risky, high-cost subprime loans to African Americans, including long-time African American homeowners. On GRITtv last year, former subprime mortgage broker turned whistle-blower Beth Jacobson described how African American brokers were sent into Black churches: "Plenty of people there might not even have thought of taking out loans or leveraging their property," but through Black churches loan officers found a motherlode of clients who they steered into subprime loans, even clients with good credit scores. The rewards for the brokers were massive: what some Wells Fargo brokers called "ghetto loans" brought upwards of twice the fees that they could make off prime-rate kind. But the cost for borrowers ? and cities like Baltimore ? were deadly. Now Baltimore's suing, foreclosures are continuing... and Stumpf's the country's best-paid CEO. A footnote? Hardly. Of human interest? I think so. -- Laura Flanders

"They frankly own the place," Dick Durbin said back in April, referring to the power that banks hold over policy decisions in Washington. If they own the place, presumably they can make the rules. But as Goldman Sachs brings in record profits and prepares to dole out handsome bonuses to employees and executives, many are lauding the company's willingness to take risks. So is Goldman Sachs, dubbed by many 'Government Sachs,' a risk taker or a coup maker? And what will it take to confront what may be the most powerful lobby in American history? Matt Taibbi, contributing editor at Rolling Stone and author of The Great Derangement: A Terrifying True Story of War, Politics, and Religion, Robert Johnson, former chief economist of the Senate Banking Committee, and Michael Lux, co-director of Progressive Strategies and author of The Progressive Revolution: How the Best in America Came to Be on why the banks are benefiting and the American worker isn't. You can read Taibbi's recent article in Rolling Stone on how Goldman Sachs blew up the economy here.

President Obama was elected with a large enough mandate for fundamental change that he could forge a fresh social compact, lock in place a new set of mutual obligations and rewrite the relationship between the state and the populace. Sasha Abramsky's comments in his book Breadline USA (which I'm paraphrasing there) would be striking enough on any day. The need for change is obvious. In 2008 the official poverty line stood at a shameful $10,590 for a single person and $21,203 for a family of four. And according to the Census 37 million Americans were living at or below those numbers. In 2008, 28.4 million Americans were receiving food stamps, a number that's risen 19 percent since today's recession started. The need for change is obvious, and last November, the appetite for it became palpable. "President Barack Obama's election was an astounding transformative moment," writes Abramsky. "Tens of millions of voters, from the most liberal to the most conservative regions of the country, stood up and said no more to the divisive greed-driven policies and priorities of the recent past." But then there's this, from today's news. Analysts report that the Wall Street firm Goldman Sachs, a major recipient of government cash, has earned a staggering $2 billion in the last three months. The bank's stock value has soared 68 percent and the Wall Street Journal predicts that it's on track to pay out as much as $20 billion this year, in compensation and benefits to its employees -- or about $700,000 per person. As formerly homelss mom, Franceska Dillella told GRITtv today -- poor Americans, like those in her New York shelter, celebrated on election night. But well-connected Goldman didn't just get hugs or hope when they fell on hard times: Goldman received $13 billion from the Bush bailout of the failed insurance giant AIG and $28 billion more in low-interest loans -- plus insurance worth untold billions more -- thereafter. Now the bank's repaid that loan and bounced back: how? The Times says Goldman "Brilliantly" capitalized on chaos--making a fortune trading bonds and buying and selling volatile currencies in a shifting market, and making out from gambling on commodities like oil -- raising prices for everyone. Back to Abramsky. In Breadlines Sasha writes that if Obama rewrites the social contract and all the rest, he might be able contain the calamity of the 2008 economic collapse. "But if he fails that calamity will haunt the next several decades..." What's more too big to fail: The banks or the country?