財經觀察 2286 : Obama is Killing America by Killing Wall Street

January 21, 2010, 1:17 PM ET Mean Street:

Obama is Killing America by Killing Wall Street

What has become of America?

Today, Goldman Sachs CEO Lloyd Blankfein announced record annual profits of $13.4 billion for his bank.

He has repaid the U.S. taxpayer $11.42 billion for taking TARP money he didn’t want.
He will contribute another $6.4 billion in taxes to the general public.

And within weeks, if President Obama gets his way, Blankfein has a good shot at becoming the most hated man in our nation.

Apparently, this is now how we treat success in America. We damn it, and then we punish it by enacting loopy, politically expedient measures such as caps on Wall Street trading and principal investments.

Why is our country so self-destructive?

We need people to come together, but we engage in populist divisiveness. We need millions of jobs, but we kill the incentives and destroy the capital that will create them.

Please don’t accuse me of not “getting it.” I do “get it.” I “get” that Main Street is suffering. I “get” that Wall Street is full of selfish, greedy people. I “ get” that Wall Street engages in reckless trading. I “get” that no bank should be too big to fail.

But does anyone actually believe the new White House war on Wall Street will remedy any of that? I know I don’t.

This war is about politics. It’s about a big election loss in Massachusetts. It’s about pushing the blame for the nation’s misery from Washington onto Wall Street.

Is President Obama talking to Tora Bora terrorists or Park Avenue bankers when he says: “So if these folks want a fight, it’s a fight I’m ready to have.”

But it’s a fight ? that at least on the PR front ? Washington is already winning. Just read today’s subdued Goldman Sachs earnings release.

Total profits were a “record” at the bank, even if earnings per share weren’t. But you wouldn’t know that from the Goldman press release. Instead, the big PR highlight is “Compensation and Benefits Down By $4 billion or 20% From 2007. Lowest Annual Compensation.”

How perverse. Job creation in our economy comes from profits and growing incomes. But here is America’s best-run company almost ashamed of its profits and bragging about how much less it’s paying its people.

Make no mistake ? this war will damage the nation’s psyche. Just look at today’s stock market. In fact, the war’s unforeseen consequences are just now beginning to appear .

It’s bound to get very, very messy because in fact, contrary to the President’s assertion, the 2008 collapse had little to do with the dissolution of Glass-Steagall or proprietary trading by banks.

Sure, Wall Street was way too vulnerable because it was way too leveraged.

But AIG wasn’t a bank. Neither Lehman Brothers nor Bear Stearns took consumer deposits. And the hundreds of billions in losses at Fannie Mae and Freddie Mac ? as well as the destruction of Wachovia, Washington Mutual and
Countrywide had nothing to do with prop trading.

That was caused by banks lending money to millions of Americans to buy houses they couldn’t afford. You won’t hear much of that coming from Washington. After all, “It’s Actually Your Fault, America” is not a good slogan for a re-election campaign.