Vampire Capitalism

The tender-minded tribe of American utopians known as "progressives" should be reflecting bitterly on the resonance of Mussolini's epigram. How else but through his optics must one interpret the evolution of the health care bill as it wended its way through one corrupt bargain after another in the Senate? At the end of the process the purported effort of Democrats to bring to heel the price-gouging of the health insurance corporations transmuted itself, as if by black magic, into its diametric opposite. Now the Senate "reform" bill mandates that every legal resident of the United States, with few exceptions, be subjected to the predations precisely of those private insurance corporations from whom the authors of reform — President Obama most prominently — claimed they would protect the public in the first place. Failure to comply with the decree to buy insurance subjects one to a confiscation of a portion of one's income by the IRS. One couldn't imagine a more seamless merger of state and corporate power.

If that weren't enough, a major expose by the New York Times was seemingly buried beneath the commercial hoopla attending Christmas, the Saturnalian legislative orgies of the Senate, and the sentencing of Balloon Boy's parents. The Times reported that Goldman Sachs as well as other money center banks short-sold their own investment vehicles for bundling home mortgages, after selling them to investors on the pretext that they were a sound purchase. [1]

Journalist Matt Taibbi has been on the Goldman beat for some time. His first major piece, "Inside the Great American Bubble Machine," [2] profiled how Goldman has taken a prime role in engineering every major market manipulation since before the Great Depression. After reading the Times piece, it is hard to argue with Taibbi's characterization of Goldman's corporate ethos: "The first thing you need to know about Goldman Sachs is that it's everywhere. 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. In fact, the history of the recent financial crisis, which doubles as a history of the rapid decline and fall of the suddenly swindled dry American empire, reads like a Who's Who of Goldman Sachs graduates."

For his troubles, and particularly for linking Goldman to pivotal figures in the Obama administration's stable of economic advisors, Taibbi has been subjected to a predictable pedantic barrage of "errors of fact and interpretation"-type criticism. In particular The American Prospect, often on the side of K Street-style New Democrats, takes the author to task for his imputation of bad motives, as if one should never be skeptical of the claims of professional politicians and Wall Street money changers. [3] Taibbi responded to these criticisms, which were mostly about insignificant details that had no bearing on his main thesis. [4]

Coming after the brouhaha about Taibbi's supposed mistakes, the New York Times piece should set to rest any question about his characterization of Goldman Sachs' internal operations, and should make its linkage with the government in Washington (the evidence for which even his detractors do not dispute; rather, they suggest, so what, where else are you going to get financial expertise?) not merely suspect but highly indicative that the present administration is dependent on the policy input of former and current representatives of a predatory, corrupt, and criminal corporation. [5]

Over the past year, how many readers had the sneaking suspicion that the much publicized trial of Bernard Madoff, merited on its own grounds as it was, was at a loftier political level simply a bread-and-circuses diversion from the real crooks? Billions, even tens of billions of dollars, are chump change these days compared to the trillions of dollars leveraged by criminal camorras like Goldman. Tossing a relatively little fish like Madoff into the maw of the justice system allowed the bigger fish to swim upstream into commanding positions in the administration.

If Goldman and its Money Center confrères really have decisive influence in the American government, if not outright control, then there is a highly unpleasant implication: lawless predators write the laws. The merger of state and corporation is not merely complete; the corporations themselves are vampires.


* Werther is the pen name of a Northern Virginia-based defense analyst.

[1] Gretchen Morgenson and Louise Story, "Banks Bundled Bad Debt, Bet Against It and Won," New York Times, December 23, 2009.

[2] Matt Taibbi, "The Great American Bubble Machine," Rolling Stone, July 13, 2009.

[3] "The Errors of Matt Taibbi," TAPPED, December 11, 2009.

[4] Matt Taibbi, "On Obama's Sellout," Taibblog, December 12, 2009.

[5] We in no way suggest that the preceding Bush administration was any less attentive to the needs of these fraudsters. The only distinction is that the country had an election in 2008 that supposedly brought people into power who would curtail such practices.