On Jan. 28, 2009, just days into the Obama presidency, the New York Times reported that bonuses on Wall Street had totaled an estimated $18.4 billion the year before, the sixth-largest sum on record. The president who had been sworn in only eight days earlier wasted no time condemning the “outrageous” bonuses, proclaiming them “the height of irresponsibility.” They were, he said, “shameful.”
Almost exactly a year later, on Jan. 29, 2010, Obama again called Wall Street bonuses during a recession “shameful.”
“There will be a time for them to make profits, and there will be a time for them to get bonuses,” he said. “Now’s not that time. And that’s a message that I intend to send directly to them.”
But a week later, he sent an entirely different message.
Asked by Bloomberg News (of all news organizations) to comment on the $17 million bonus taken by J.P. Morgan Chase CEO Jamie Dimon and the $9 million bonus of Goldman Sachs CEO Lloyd Blankfein, Obama said he doesn’t “begrudge” the men their money.
“I know both those guys; they are very savvy businessmen,” he said. “I, like most of the American people, don’t begrudge people success or wealth. That is part of the free-market system.”
He went on to explain that, hey, bonuses themselves aren’t bad, but they have to be tied to performance and be approved by shareholders.
The obvious reversal from the president’s previous rhetoric cannot be chalked up to Scott Brown and the GOP’s resurgence. It runs deeper than that.
Obama gave the reason when he said, “I know both those guys.” Yes, he does. Blankfein is a major donor to the Democratic Party. He has given more than $100,000 to the Democratic Party and Democratic candidates, Federal Election Commission reports show. Jamie Dimon is a periodic donor, but he gives exclusively to Democrats and is based in Chicago, where he got to know Obama. The New York Times last year proclaimed Dimon “Obama’s favorite banker.” The quote was from a feature story on Dimon, but the photo atop the story showed two bank CEOs leaving the White House after a meeting. The other? Lloyd Blankfein.
This president, like any politician, plays favorites. In the world of high finance, Dimon and Blankfein are two of his favorite multi-millionaire CEOs. So even though the president is on record multiple times stating that financial industry executives shame themselves when they take bonuses during a recession, he wasn’t going to apply that standard to his pals when put on the spot. The rest of Wall Street? They’re a bunch of greedy, heartless SOBs. But my buddies and their combined $26 million in bonuses? They’re just good capitalists.
Republicans will point out this hypocrisy, as they should. But to call it merely hypocritical is to miss the point. Obama’s double standard is the inevitable outcome of the left-wing class warfare he employs to marginalize his opponents and justify his economically damaging policies. The outcome is inevitable because classes are groups of individuals, not simply lines drawn on an income chart. And individuals have ways of defying left-wing predictions of how they will behave based on their wealth and social status. Also, those lines are political conventions, not real-world barriers keeping certain types of people fixed in specific categories.
This isn’t even the first instance of Obama getting caught in this predictable tight spot. Remember Joe the Plumber?
In the campaign, Obama had attacked “the rich” repeatedly, saying they sought and received special treatment from Republicans in the form of undeserved tax breaks. The press started asking him to define “rich,” and after trying and failing to dodge the question, he finally settled on a figure: $250,000 a year. Make more than that, and you’re “rich.” Then he bumped into Joe the Plumber, a blue collar guy who said he’d make more than $250,000 a year, and thus be hit by Obama’s proposed confiscatory tax rates, if he bought his own plumbing business.
Suddenly, Obama’s demonizing of the rich was exposed as the fraud it always had been. His demonization of Wall Street is exactly the same. Bankers and Wall Street investors are easy game when they are an abstract concept. We all just imagine fat white men in pin-striped suits lighting cigars with $100 bills and ordering truckloads of cash delivered to the Republican National Committee, which of course is housed in a twisted castle atop a desolate Romanian hilltop where dark clouds and lightning are the constant backdrop.
But in reality, these men and women are hard-working, intelligent Americans who contribute tremendously to the economic success and vitality of this nation — and to different political parties. (In the 2008 presidential campaign, Wall Street gave more to Democrats than Republicans.) Some have behaved shamefully. But as a group they are not enemies of the people, which is exactly how Obama has portrayed them. Two of them even happen to be Friends of Barack.
As Obama has accidentally admitted, taking a big bonus during a recession is not shameful. Pitting Americans against each other for purely political purposes is.