President Obama speaks during a campaign event in Colorado. (AP/Carolyn Kaster)
Maybe I have been too harsh in judging Barack Obama's economic performance. Instead of following George W. Bush's lead in bailing out the bankers first, I wanted Obama to do more for beleaguered homeowners and less for the Wall Street swindlers who trafficked in toxic mortgages. But the president must have done something right, or the hucksters at Goldman Sachs wouldn't hate him so.
Ever since Bill Clinton appointed Goldman honcho Robert Rubin to be his Treasury secretary, the firm has been the top corporate supporter of the Democrats, according to the authoritative Center for Responsive Politics. And the investment paid off big time when Clinton followed Rubin's lead and teamed up with congressional Republicans to reverse the sensible restraints on Wall Street that had kept the economy sound for six decades. Thanks to that decision, Goldman, a high-rolling investment house, was allowed to suddenly become a commercial bank and avail itself of the cheap money provided by the Federal Reserve to bail out troubled banks.
The financiers thought the fix was in once again when Obama turned to Rubin protege Lawrence Summers as his key economic adviser in the 2008 campaign. Summers had replaced Rubin as Clinton's Treasury secretary and had been even more vigorous in destroying the regulations that had maintained a stable financial system for 60 years. Wall Street turned against the GOP and its candidate John McCain, much preferring Obama. It should burnish the president's reputation in the eyes of ordinary voters that those merchants of greed now feel so betrayed.
As The Wall Street Journal reported Tuesday: "When Barack Obama ran for president in 2008, no major U.S. corporation did more to finance his campaign than Goldman Sachs Group Inc. This election, none has done more to defeat him."
The high rollers at Goldman have given $900,000 to the super PACs supporting Mitt Romney but not a nickel to the main one backing Obama. Direct contributions to the GOP candidate are almost seven times higher than to his Democratic rival.
Wall Street's disenchantment with the president is not restricted to the "fat cat bankers" at Goldman who became particularly incensed when Obama once labeled them as such. It extends throughout the financial elite who had come to feel a comfortable sense of ownership of both political parties. Employees at the top five banks -- JPMorgan Chase; Citigroup, where Rubin went to work after leaving the Clinton White House; Bank of America; Morgan Stanley; and Goldman -- donated $3.5 million to Obama in 2008, but this year cut that to $650,000. This time it was Romney who was showered with $3.3 million in contributions.
But let's not go overboard in assuming that Obama has been some sort of populist. His reforms have been tepid and seem tough only in comparison to the get-out-of-jail-free cards that Romney now offers. The fat cats' sense of betrayal at the hands of the Obama administration is obviously less a reflection of actual financial pain they endured these last three years than it is a mark of bankers' uncontrollable greed.
The arrogance of these people, given the increased concentration of wealth in their hands during these years of profound financial crisis for most Americans, is beyond comprehension.
Consider the endorsement of Romney by Jim Donovan, the Goldman banker who handled relations with Bain Capital, the private equity firm run by Romney that dismembered companies and their jobs for outsized profit. He still manages Romney's personal accounts, and although the details of those are not shared with the public, Donovan is quoted in The Wall Street Journal as assuring his banker colleagues that Romney's "conviction and strength on fixing the U.S. economy is compelling as are his values." Enough said.
I know that banker bashing can be off-putting in a media world practiced in dismissing all-too-accurate references to the extreme disparity of rewards to the richest as an expression of the irrationality of class warfare. But how else to describe the pique of an industry that feels oppressed by the Obama presidency despite an average annual wage of $362,950, which in 2011 increased by a not inconsiderable 16.6 percent over the previous two years. (That's the average for securities industry employees, not to be confused with the $12 million eked out by Goldman CEO Lloyd C. Blankfein last year, down from the $68.5 million he got in 2007 when Goldman was happily constructing toxic security bundles.)
Those figures on the overall rise in Wall Street pay, released this week by the New York State comptroller, offer a stark reminder that under the policy of bailing out the banks, initiated by Bush but embraced by Obama, class warfare has been waged effectively not by the unemployed and foreclosed. It rather has been carried out by the bankers who caused the economic meltdown and who now are ticked off that Obama has not completely rolled over.