FacebookTwitterGoogle+RedditEmail

When Prosperity Comes to Bad Men

Surfeit begets insolence, when prosperity comes to a bad man.

Theognis, c. 545b.c.

I hope the President didn’t take it personally. I’m sure no offense was intended. Even though bank presidents have shown they can single handedly almost sink the economy, they can’t control the weather that prevented their making it to the meeting. Of course some people might wonder why they didn’t leave a day earlier. A lot of people who have a morning meeting scheduled with the President of the United States would be very anxious to make sure they were in town the night before so as not to miss the meeting. Such a meeting is heady stuff even for a bank president. My guess is that the men all had good reasons for not arriving in Washington D.C. the night before the meeting and it was not, as some might think, a lack of respect for the President of the United States. A number of factors explain their actions.

One is that it was the middle of the holiday season and a Sunday night two weeks before Christmas is a time when there are lots of holiday parties. It is important for bank presidents to be in attendance to show that even though 12 months ago they were being bailed out by, among others, the people at the parties as well as lots of other people their cheerful demeanors prove that they are not the least bit nervous about the economy or the state of their banks. Another reason they may have waited until Monday to travel to see the President (if they were not partying) was to give them additional time to work for the benefit of customers, employees and shareholders.

Lloyd Blankfein, president of Goldman Sachs (who missed the meeting), was very likely spending the evening doing rough calculations as to how to divide up $16 billion in bonuses among his thousands of employees. That is a complicated calculation. He may also have been working on the speech he would give to his employees to explain why some of them would get bonuses in stock instead of cash.

Citigroup’s Vikram Pandit missed the meeting because Citigroup had a $17 billion stock offering on the same day as the meeting with the President took place. Mr. Pandit spent the day convincing investors they should buy some of the stock that was being offered. Thanks to those efforts Citigroup received $425 million in fees from the offering. In Mr. Pandit’s place Citigroup’s chairman, Richard Parsons was to attend, but having better things to do on Sunday night than spend the night in the capitol he waited until Monday morning to travel and because of weather had to miss the meeting. He may have spent some time Sunday night working on helping those struggling to pay their mortgages who were hoping to qualify under the “Making Home Affordable Program.” In November 2008 Citigroup said its intention was to reach out to 500,000 borrowers who needed help to avoid foreclosure. It said its program might result in $20 billion of mortgage refinancings. As of November 2009 it had fallen a bit shy of its goal. Of all mortgagees who were eligible for modification it had only entered into trial modifications with 100,126 homeowners instead of 500,000 homeowners and had only made permanent modifications with 271 borrowers out of the 231,000 who were estimated to be eligible.

John Mack of Morgan Stanley was probably also spending Sunday night trying to figure out how to help those threatened with foreclosure who were in distress. Morgan Stanley’s subsidiary, Saxon Mortgage Services, Inc. had an estimated 80,000 eligible loans and had 35,565 trial modifications going on but as of the end of November had only made 42 of the loan modifications permanent. The rest were still awaiting approval. Of course he might have been toasting the fact that although those numbers are not impressive, when its permanent loans modifications are added to its trial modifications it turns out that 44% of its loans have been modified or are in the trial stage and that, percentage wise, places it at the top of all the Servicers in the program.

The “Making Home Affordable Program” has been in place for slightly over a year. The Treasury Department estimates there are 3,299,780 people eligible to participate in the program. As of the end of November only 31,382 have received permanent modifications. The three presidents who missed the meeting are probably keenly ware of the failure of their institutions to do more for those in trouble. They may even feel a bit of guilt about it. Not enough, however, to have made sure they’d get to the meeting with the President on time. And not enough to cause them to forego their large bonuses.

CHRISTOPHER BRAUCHLI is a lawyer in Boulder, Colorado. He can be e-mailed at brauchli.56@post.harvard.edu.

More articles by:
June 19, 2018
Ann Robertson - Bill Leumer
We Can Thank Top Union Officials for Trump
Lawrence Davidson
The Republican Party Falls Apart, the Democrats Get Stuck
Sheldon Richman
Trump, North Korea, and Iran
Richard Rubenstein
Trump the (Shakespearean) Fool: a New Look at the Dynamics of Trumpism
Kevin Zeese - Margaret Flowers
Protect Immigrant Rights; End the Crises That Drive Migration
Gary Leupp
Norway: Just Withdraw From NATO
Kristine Mattis
Nerd Culture, Adultolescence, and the Abdication of Social Priorities
Mike Garrity
The Forest Service Should Not be Above the Law
Colin Todhunter
Pro-GMO Activism And Smears Masquerade As Journalism: From Seralini To Jairam Ramesh, Aruna Rodrigues Puts The Record Straight
Doug Rawlings
Does the Burns/Novick Vietnam Documentary Deserve an Emmy?
Kenneth Surin
2018 Electioneering in Appalachian Virginia
Nino Pagliccia
Chrystia Freeland Fails to See the Emerging Multipolar World
John Forte
Stuart Hall and Us
June 18, 2018
Paul Street
Denuclearize the United States? An Unthinkable Thought
John Pilger
Bring Julian Assange Home
Conn Hallinan
The Spanish Labyrinth
Patrick Cockburn
Attacking Hodeidah is a Deliberate Act of Cruelty by the Trump Administration
Gary Leupp
Trump Gives Bibi Whatever He Wants
Thomas Knapp
Child Abductions: A Conversation It’s Hard to Believe We’re Even Having
Robert Fisk
I Spoke to Palestinians Who Still Hold the Keys to Homes They Fled Decades Ago – Many are Still Determined to Return
Steve Early
Requiem for a Steelworker: Mon Valley Memories of Oil Can Eddie
Jim Scheff
Protect Our National Forests From an Increase in Logging
Adam Parsons
Reclaiming the UN’s Radical Vision of Global Economic Justice
Dean Baker
Manufacturing Production Falls in May and No One Notices
Laura Flanders
Bottom-Up Wins in Virginia’s Primaries
Binoy Kampmark
The Anguish for Lost Buildings: Embers and Death at the Victoria Park Hotel
Weekend Edition
June 15, 2018
Friday - Sunday
Dan Kovalik
The US & Nicaragua: a Case Study in Historical Amnesia & Blindness
Jeremy Kuzmarov
Yellow Journalism and the New Cold War
Charles Pierson
The Day the US Became an Empire
Jonathan Cook
How the Corporate Media Enslave Us to a World of Illusions
Ajamu Baraka
North Korea Issue is Not De-nuclearization But De-Colonization
Andrew Levine
Midterms Coming: Antinomy Ahead
Louisa Willcox
New Information on 2017 Yellowstone Grizzly Bear Deaths Should Nix Trophy Hunting in Core Habitat
Jeffrey St. Clair
Roaming Charges: Singapore Fling
Ron Jacobs
What’s So Bad About Peace, Man?
Robert Hunziker
State of the Climate – It’s Alarming!
L. Michael Hager
Acts and Omissions: The NYT’s Flawed Coverage of the Gaza Protest
Dave Lindorff
However Tenuous and Whatever His Motives, Trump’s Summit Agreement with Kim is Praiseworthy
Robert Fantina
Palestine, the United Nations and the Right of Return
Brian Cloughley
Sabre-Rattling With Russia
Chris Wright
To Be or Not to Be? That’s the Question
David Rosen
Why Do Establishment Feminists Hate Sex Workers?
Victor Grossman
A Key Congress in Leipzig
John Eskow
“It’s All Kinderspiel!” Trump, MSNBC, and the 24/7 Horseshit Roundelay
Paul Buhle
The Russians are Coming!
FacebookTwitterGoogle+RedditEmail