Yes, it's true. The rich do get richer. While the rest of us suffer the worst economic situation since the Depression, Goldman Sachs is paying RECORD salaries and bonuses this year to its 28,000 employees. In fact, if Goldman Sachs suddenly became more democratic and divided these bonuses up evenly, each employee would get an average of $600,000 in salary and bonuses.
Gee, $600,000 seems like a reasonable salary. Especially in this economy. After all, minimum wage is going up. A Democrat-controlled Congress finally managed to raise the federal minimum wage to $7.25 an hour. So full-time minimum wage workers will now earn about $15,000. Since $15,000 is still below the poverty level for a family, the average person might get the idea that it is completely unfair for Goldman Sachs employees to earn 300 times the poverty level and 400 times what a minimum wage worker earns.
But we should understand that these rich bankers at Goldman Sachs need their salaries because they're used to them and they're used to getting more and more every year and it would be really difficult for them if they couldn't vacation in the Hamptons and send their kids to super expensive schools and take little Fifi to the groomer every Wednesday while they get Botox shot into their foreheads. So really, we should just let them have their piles of money and get on with the business of getting by.
But wait, Goldman Sachs is paying its record salaries with OUR MONEY. Yes, that's right, the fat cat bankers at Goldman Sachs led the way when it came to risky lending and trading practices, then, when the consequences of those practices became clear and other banks began to fail, Goldman Sachs snapped up $10-billion in federal bailout money to cover its bad investments. Goldman Sachs also used the AIG bailout to make sure they didn't have to pay for the subprime mortgage crisis that they created. According to the Globe and Mail,
Goldman got back its full $13-billion exposure to American International Group thanks to Washington's bailout of the faltering insurer. The rescue enabled Goldman, along with other financial institutions, to receive 100 cents on the dollar as a counterparty to the risky bets made in the subprime mortgage market and elsewhere – a considerably better outcome than most other investors caught in the financial meltdown.
More than most banks, Goldman anticipated the mortgage meltdown, even betting on its unwinding. And now, with several of its competitors hobbled (Merrill Lynch) or gone (Lehman Brothers), the recapitalized bank is doing very well as a dealer in bonds, including the bonds issued by the federal government to finance all the bailouts and fiscal stimulus.
It's the use of US taxdollars to keep itself on top and then using the profits from those tax dollars to pay even bigger salaries to the Goldman Sachs bankers that makes the Obama bailout look like a bailout for bankers and not the people. It is also why Matt Taibbi referred to Goldman Sachs as
a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.
But if Taibbi is right, then it's the federal government and the bailout that are the "blood funnel" because they're the ones who decided to bail out the bankers who created the collapse of credit rather than the people who suffered with high interest loans and more debt than they could ever possibly pay off- especially at $7.25 an hour.
And a stake to the heart is impossible since clearly these people have no heart. No, the only solution is to demand that the "second bailout" (the inevitable next infusion of cash to try to get the economy going again) be for the people, not the bankers. Congress and the Obama administration must notice that even with minimum wage higher than ever, outrage over the shameless greed of bankers is also higher than ever.