Though we need to wait until November to find out who the next president will be, we already know who the king is.
That would be JPMorgan Chase CEO Jamie Dimon, who got the regal treatment from the Senate Finance Committee this week when he was called to testify about the disastrous trades that has cost his firm more than $3 billion so far and reduced the firm's market value by $27 billion.
You know, the trades that Dimon originally dismissed as a “tempest in a teapot.”
Which gives you some idea of the teapots that President Obama’s favorite banker can afford. President Obama has particularly close ties to the bank: JPMorgan’s PAC was one of the top donors to his 2008 campaign, offering more than $800,000, and the president’s former chief of staff, William Daley, was a top executive there.
Dimon is equally popular on Capitol Hill. Instead of a grilling him about his failure to take action for months after questions were raised about the strategy surrounding the failed trades, most of the senators treaded lightly.
Instead of scrutinizing the foreclosure fraud and failure that led to JPMorgan’s $5.3 billion share of a $26 billion settlement with state attorneys generals, several senators took the opportunity to offer Dimon a platform to continue his campaign against regulation of Wall Street, including modest reforms like the Volcker rule which many say could have prevented the JPMorgan loss – had it been in place.
For his part, Dimon denied that he knew anything, took some vague responsibility and minimized the losses as an isolated event.
The route to traditional royalty is through birth or marriage. Dimon won his political crown through another time-honored path – he bought it. Most of the senators he faced had benefited from the generosity of his bank’s campaign contributions. As the Nation’s George Zornick reported, the senators had received more than $522,000 from JPMorgan, about evenly split between Republicans and Democrats.
The staff of the Finance Committee and JPMorgan are connected through a web of revolving door contacts. The banking committee’s staff director is a former JPMorgan lobbyist, Dwight Fettig. One of the banks’ top lobbyists is a former staffer for banking committee member Sen. Chuck Schumer, while three of its outside lobbyists used to work for the committee or one of its members.
J.P. Morgan has pummeled Congress and regulators with more than $7.6 million worth of lobbying in an effort to get banking rules written to favor the bank.
The king’s appearance before his subjects on the Senate Finance Committee was a powerful demonstration, for those who still need it, of just how little of the spirit and the practice of real democracy remains in an institution that is supposed to embody it.
If our representatives were truly beholden to us, rather than to Dimon and others with large supplies of cash to dole out, his testimony would have had a starkly different tone.
He has a lot to answer for. So do those who let him off so easy.
And it’s not just Dimon that the senators have failed to oversee. While bankers’ profits are back, the banking system is still broke.
If those senators were serving us, rather than serving as lapdogs to bankers, Dimon and other Wall Street monarchs might be looking at prison cells, not red carpets.