Dimon's comment was another way of saying that his bank, and everything it represents, is The Shock Doctrine made manifest. The nation's megabanks are arbitraging their own failures, and the economic crises that flow from those failures.
These institutions are designed to prey off economic misery. They suppress genuine market forces in order to thrive, and they couldn't do it without our ongoing help. The Treasury Department and the Federal Reserve are making it happen.
We who have made these banks "antifragile" have crowned their leaders our Lords of Disorder.
Once Dimon told reporters that he explained to his seven-year-old daughter what a financial crisis is -- "something that happens ... every five to seven years," which "we need to do a better job" managing.
Thanks to fat political contributions, Dimon manages them well. So do his peers. Misery is the business model. And by Dimon's reckoning another shock's coming any day now.
Money For Nothing
Bloomberg's use of the word "subsidy" in this instance can be slightly misleading. Public institutions don't issue $83 billion in checks to Wall Street's biggest banks every year. But they didn't let them fail as they should have -- through an orderly liquidation -- after they created the crisis of 2008 through fraud and chicanery. Instead it allowed them to prosper from it, creating that $83 billion implicit guarantee.
As we detailed in 2011, the TARP program didn't "make money," either. Banks received a free and easy trillion-plus dollars from our public institution, on terms that amounted to a gift worth tens of billions, and possibly hundreds of billions.
That gift prevented them from failing. In private enterprise, this kind of rescue is only given in return for part ownership or other financial concessions. But our government asked for nothing of the kind.
Breaking up the big banks would have protected the public from more harm at their hands. That didn't happen.
Government institutions could have imposed a financial transaction tax, whose revenue could be used to repair the harm the banks caused while at the same time discouraging runaway gambling. They still could.
They could have imposed fees on the largest banks to offset the $83 billion per year advantage we've given them. They still could.
But they haven't. This one-sided giveaway is the equivalent of an $83 billion gift for Wall Street each and every year.
Cut and Paste
$83 billion per year: Our current budget debate is framed in 10-year cycles, which means that's $830 billion in Sequester Speak. You'd think our deficit-obsessed capital would be trying to collect that very reasonable amount from Wall Street. Instead the White House is proposing $130 billion in Social Security cuts, $400 in Medicare reductions, $200 billion in "non-health mandatory savings," and $100 billion in non-defense discretionary cuts.