Julian Delasantellis has a piece at Asia Times Online taking issue with Matt Taibbi's Rolling Stone article about Goldman Sachs. Hat-tip to LP for this.
(Delasantellis is right that Taibbi's understanding of 1929, and Goldman's role in it, comes from Galbraith's The Great Crash (the chapter entitled "In Goldman Sachs We Trust"). But he is wrong not to care who is the best Bond—it is so clearly Connery that it is painful to watch the others, imho.)
For related D&S reading, see this Ask Dr. Dollar column about the supposed "international banking conspiracy," and also Robert Zevin's piece, All that Glitters is Goldman Sachs.
By Julian Delasantellis
I've seen every single James Bond movie, a few on their opening morning in the theatres, but as for the eternal debate as to who—Connery, Lazenby, Moore, Dalton, Brosnan or Craig—was the best Bond, I couldn't care less. I watch for the villains.
What a glorious gang they are. Suave, sophisticated, well spoken, all-powerful, all-seeing and all-knowing in their incredibly dastardly and ambitious plots, they seem quite the contrast with actors in today's world, Peter Principle incompetents who couldn't bomb the water even if they fell out of a boat. My favorites are Thunderball's Emilio Largo (Adolfo Celi), a man so evil that he seemed to have an offscreen orchestra follow him around continually playing ominously threatening sounding overtures (also, I liked the part that he was called the "guardian" of Domino, Claudine Auger-yeah, right), and Alex Trevelyan (Sean Bean) of Goldeneye. Putting a rare bit of actual history in the plot lines, Trevelyan's story was that he was a descendent of the so-called Liensk Cossacks, nationalist, anti-communist Russians who fought for Hitler during World War II. This group was betrayed back to Stalin's most untender mercies by the West after the war, and Trevelyan, a former MI-6 agent, still burns for horrible revenge against a British society that gave him its class, manners and refinement in exchange for the murder of his parents.
After September 11, I wondered if we had, in Osama Bin Laden, a real live Bond-type villain, as he had managed to pull off, with not one of his henchmen getting lost or being prevented from getting to the airport by a dead battery or parking enforcement boot, a plot of truly Bond-scale perfidy and ambition. It was only later that we learned, by discovering that all Saudi pilots had to train in the United States to receive their commercial licenses, that all Bin Laden had done was to find a seam in American security big enough to fly jumbo jets through.
Indeed, the belief that shadowy, all-powerful and all-secret conspiracies are forever working behind the scenes to thwart the American people's express will is a fairly common theme in American political and social life. Back before World War I it was the mysterious Colonel House who whispered in President Woodrow Wilson's ear to support the establishment of both the progressive income tax and the Federal Reserve; he is also said to be the one who, in contravention of George Washington's sacred advice to the nation 120 years previously to avoid "foreign entanglements", convinced Wilson to get the United States involved in the war.
Prior to the Japanese attack on Pearl Harbor, it was said that the elite Council of Foreign Relations (CFR), the secretive society for all those Harvard and Yale scion not desirous to give the nation up to the new political reality of the New Deal, "arranged" for the attack by assuring that the US Pacific Fleet's aircraft carriers would be out of their Hawaiian homeport on December 7.
Then, all during the Cold War, and the 20 years of New World Disorder that has followed it, the shadowy underworlds of both the extreme left and right have been continually striking from out of the darkness against the popular will. Taking Middle Europe's Crusades-era fantasies about mysterious Masonic orders to America animated much suspicion about the nation's Boston/Washington power axis in the still mostly uninhabited sunbelt. The conspiracies from the left were drawn more from current events than ancient history, with suspicions about plots ever being hatched by arms contractors, oil companies and multinationals such as Bechtel and ITT; neither right nor left had much use for the CFR.
President George HW Bush's phrase that he intended should describe the post cold war era of peace and prosperity, the "New World Order", became a sort of nefarious conspiracy in and of itself, with NWO's silent black helicopters ever said to be prowling the dark skies of American suburbia by night, just itching to pluck a gun-rights activist out of his bed for eventual deposit at UN concentration camps in Montana.
As a general rule, to be considered for the part of a nefarious worldwide conspirator, you have to be public and known, but not too much public and not that well known. Many conspiracy theorists posit that the strings of the world are being pulled by something called the Bilderberg group, but that sounds more like a fast-food drive through than a perverted cult of the super rich. Similarly, when it is said that the world is ruled by the Masons, care is made to specify that "the Masons" here refers to a super-elite and secret band called the "Secret Rite 33rd degree Masons", not ordinary, everyday Masons like your neighbor, who apparently isn't even powerful enough to return your lawnmower.
Public, but not too public? If that's the central operating criteria to be accused of operating a secret world conspiracy, then it's no wonder that Rolling Stone writer Matt Taibbi chose Goldman Sachs to anoint upon the dark throne of current evil ruling conspiracies. In his long piece in the July 9-23 edition, "The Great American Bubble Machine—how Goldman Sachs has engineered every major market manipulation since the Great Depression." Taibbi says your empty wallet or pitiful ATM receipt slip are just about all Goldman's fault.
Taibbi certainly cannot be accused of burying his lead, for in his second sentence he makes this comparison, probably more fitting to the monsters in the Sigourney Weaver Alien franchise than how you would commonly assume an investment bank would be described.
"The world's most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money."
After calling John Thain, the former Goldman employee who was Merrill Lynch CEO at the time of its buyout by Bank of America, a pejorative applicable to the exit terminus of the alimentary canal, Taibbi lifts Goldman's magician's curtain just a little bit higher.
"What you need to know is the big picture: If America is circling the drain, Goldman Sachs has found a way to be that drain—an extremely unfortunate loophole in the system of Western democratic capitalism, which never foresaw that in a society governed passively by free markets and free elections, organized greed always defeats disorganized democracy.They achieve this using the same playbook over and over again. The formula is relatively simple: Goldman positions itself in the middle of a speculative bubble, selling investments they know are crap. Then they hoover up vast sums from the middle and lower floors of society with the aid of a crippled and corrupt state that allows it to rewrite the rules in exchange for the relative pennies the bank throws at political patronage. Finally, when it all goes bust, leaving millions of ordinary citizens broke and star ving, they begin the entire process over again, riding in to rescue us all by lending us back our own money at interest, selling themselves as men above greed, just a bunch of really smart guys keeping the wheels greased."
Taibbi proves his point in two ways. First, he seems to have taken a comprehensive census of everybody working in the finance business around the world. Of course, he finds many, many former Goldman alumni in this manner; as the annual visit from the Goldman Sachs recruiter is the most important day in business schools around the world, this should not be that surprising. Among these are Thain, Bush, former Treasury secretary Henry Paulson and Clinton Treasury secretary Robert Rubin, along with Robert Steel from Wachovia, Bush-era White House chief of staff Josh Bolton, New Jersey governor Jon Corzine, Ed Liddy of AIG, Ebay CEO Meg Whitman , and "chattering television—( that orifice word again) Jim Cramer".
It's certainly an impressive list; if you added on a bunch of foreign economic mandarins and central bankers it would be even longer.
But does it mean anything? Taibbi seems to be implying that, for all these officials, employment at Goldman is like being in a mafia family—once you're in you're never out. Once you start doing Goldman's bidding, you will continue to do so forever—you've totally lost your ability to execute your individual desires in favor of those being broadcast to your head from Goldman Sachs' World Headquarters on Broad Street.
Even more surprising is the fact that, for the overwhelming majority of these ex-Goldmans, the view that money is the central operating factor in economic decisions illuminates how they deal with their careers as well as the companies of which they are employed. Goldman could have kept their wayward staff until they took their secrets to the grave, but not when other institutions start offering better deals. That caused the alumni to go out from Goldman and conquer; the alumni are still working hard, hoping that some other future prospective employer will see their work and hire them away once more.
In short, would it be rational for all of the Goldman competitors and other institutions who have hired Goldman alumni away for premium prices to accept a situation where their new employees are still known and accepted to be working to advance Goldman's interests? If the answer to that question is no, much of Taibbi's argument falls away almost immediately.
The second part of Taibbi's argument is to look back on five previous economic calamities, and one possible one in the future, to dig out Goldman's previously hidden secret duplicities.
Taibbi goes back 80 years for his first example of Goldman perfidy, back to the heady days of 1929 before the great Wall Street Crash. Excessive employment of leverage was as much a cause of that crash as it was the current one, but back then, leverage was effected not through exotic debt securities, but through mutual fund like vehicles called "investment trusts".
Most of Taibbi's 1929 analysis comes from John Kenneth Galbraith's masterpiece on the subject, The Great Crash. Taibbi notes that:
The Great Crash
But what Taibbi does not mention was that Goldman's investment trusts were hardly the biggest on the street; United Founders and State Street's trusts bested Goldman's. Also, how does one mesh Taibbi's conception of an all-powerful Goldman eternally directing efforts behind the scenes with the fact that the bank lost, in current value, $475 billion during the period, with its stock dropping from $102 to $3?
If that's what's happened to the chiefs, just imagine the world of hurt of the Indians.
Read the rest of the article.
