The goose that lays golden eggs has been considered a most valuable possession. But even more profitable is the privilege of taking the golden eggs laid by somebody else’s goose. The investment bankers and their associates now enjoy that privilege. They control the people through the people’s own money.
–Louis Brandeis, Other People’s Money and How the Bankers Use It (1914)
While the national debt struggle is getting the headlines, the bankers’ lobbyists in the backrooms of the Capitol are trying to undo the Dodd-Frank Act. It is a full-out assault ranging from trying to water down and if possible eliminate statute-mandated regulations to getting Republican members of Congress to chop big chunks off the budgets of the agencies that are trying to implement and enforce the new law. Taking Elizabeth Warren’s head was thrown in for good measure, and there were whispers that the President’s praetorian guard did not lament the passing of the President’s “dear friend.”
Almost a hundred years ago, Louis Brandeis and other progressive reformers were trying to break the hold the banks had on the American economy. Big bank power was near absolute, and their regard for government power scant. After Theodore Roosevelt in 1902 had sued to break up J.P. Morgan’s Northern Securities railroad trust, Morgan called on the President at the White House. “If we have done something wrong,” he said, “send your man to my man and they can fix it up.” Roosevelt refused, reflecting:
“That is a most illuminating illustration of the Wall Street point of view. Mr. Morgan could not help regarding me as a big rival operator who either intended to ruin all his interests or else could be induced to come to an agreement to ruin none.” (W.H. Brands, American Colossus, 2010, 547)
Not much has changed. The Wall Street moguls still don't take much guff from Presidents. Why should they? After the 2008 crash, the federal government bailed out the big banks, bent anti-trust rules to allow them to absorb competitors and increase market share, all the while the banks waged war to escape regulation, paid mind-boggling bonuses once again, and stiffed the very mortgage borrowers whom they ripped off and are now repossessing.
