Bailed-Out Bank CEO: Public Criticism of Wall St. Bonuses is Just Like Lynchings

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AIG CEO Robert AIG CEO Robert Benmosche is interviewed by Neil Cavuto on the Fox Business network. (AP Photo/Richard Drew)

In an interview published Monday in The Wall Street Journal, AIG chief executive Robert Benmosche compared the American public’s outrage at bailed-out Wall Street execs grabbing bloated bonuses to African-Americans being lynched in the Old South.

No, really. Here’s the quote (brackets are in the original):

The uproar over bonuses “was intended to stir public anger, to get everybody out there with their pitch forks and their hangman nooses, and all that–sort of like what we did in the Deep South [decades ago]. And I think it was just as bad and just as wrong.

In 2008, AIG received $85 billion from American taxpayers on top of the funds made available from the TARP program. Less than a week later, a bunch of AIG executives went on a “retreat” to the luxurious St. Regis Resort in Monarch Beach, Calif., where they ran up a bill of almost a half-million dollars, including $150,000 for meals and $23,000 in spa charges.

Now, with Wall Street employees pocketing average cash bonuses of $121,900 — while most families’ incomes stagnate — Benmosche thinks the public should have more sympathy for the plight of these good people. “They’re all scared,” he told the Journal. “They [had made] good livings. They probably lived beyond their means. We wouldn’t be here today had they not stayed and accepted … dramatically reduced pay…It is a shame we put them through that.” One can almost hear the sad strains of a violin playing softly in the background.

This is not the first time a Wall Street titan has unintentionally revealed a mind-boggling degree of entitlement. Apparently, it’s not enough that high-level bankers have all avoided jail for crashing the economy through widespread fraud. It’s not enough that they are enjoying record profits once again, that they have effectively captured the regulatory agencies that are supposed to police them or that the “too big to fail” firms have only grown larger since the bailouts. When politicians call them “fat cats,” or the public expresses outrage at their insatiable appetite for material wealth, they respond like a powerless minority facing the cruelest oppression.

In 2011, Harvey Golub, the former CEO of American Express who believes corporations shouldn’t be taxed at all, wrote in The Wall Street Journal that he “deeply resent[ed]” Obama’s call to hike the top tax rates by a few points (to the level they were during the Clinton administration). Golub also needed to share with the American people his further resentment about investor Warren Buffett writing an op-ed titled, “Stop Coddling the Super-Rich.” “I don’t feel coddled,” wrote Golub, before making the implausible claim that he would fork over 80-90 percent of his income in taxes — and then complaining about how public employees receive “outlandish benefits.” In a perfect angry old man pitch, he concluded by asking, “Do we really need an energy department or an education department at all?”

JPMorgan CEO Jamie Dimon rarely stops whining. At Davos in 2011, Dimon said, “Not all banks are the same and I just think that this constant refrain ‘bankers, bankers, bankers’ is just unproductive and unfair. People should just stop doing that.” He’s right — not all banks are the same. Dimon’s bank just paid a billion dollars in fines for bilking customers and allegedly manipulating markets, and according to The New York Times, JPMorgan “is now facing investigations from at least seven federal agencies, several state regulators and two foreign nations.” Dimon would tell a Chamber of Commerce audience that same year that the Dodd-Frank regulations would be “a nail in our coffin for big American banks.” He also lamented the “anger and the shrillness” poor Wall Street executives had to face.

Stories of the financial community’s ultra-thin skin have proliferated since the crash. In fact, they’ve become a genre of their own. Jonathan Chait and James Downie dived into Politico’s archives and found 28 variations of the “business upset at Obama” story in 2009 and 2010 alone – pieces with headlines like, “Bankers to Obama: stop trashing us,” “Regulation War: business in crosshairs,” “Wall Street plans payback for reg reform” and “Obama’s words sting CEOs.”

A study by UC-Berkeley social psychologist Paul Piff found that people with high socio-economic status are more likely to harbor a sense of entitlement and display narcissistic personality traits than are those of lesser means. And powerful Wall Street executives continually substantiate his research every time they decide to share their hurt feelings with the media.

Joshua Holland is a senior digital producer for BillMoyers.com. He’s the author of The Fifteen Biggest Lies About the Economy (and Everything Else the Right Doesn’t Want You to Know about Taxes, Jobs and Corporate America) (Wiley: 2010), and host of Politics and Reality Radio. Follow him on Twitter or drop him an email at hollandj [at] moyersmedia [dot] com.
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  • Karlheinz Groeger

    What kind of response would one expect from a narcissist?

  • Charles Robinson

    Criticizing people who greedily gambled their companies into insolvency and built a house of cards out of unfunded insurance liabilities that threatened the global economy, after they’ve helped themselves to a ton of public money provided as bailouts, is exactly like torturing and murdering somebody because of the color of their skin.

  • Anonymous
  • ABQsun

    Yup, all I could think about was Paul Piff’s study as I read this and then BAM there it is, LOL.

  • Alisoquoladi

    They are all sociopaths that care not for anything but their god, money.

  • THOMAS

    Greed is good and helps the economy that has been the refrain for last 30 years thanks to policies executed by President Reagan. Trickle down and Ann Rand disciples will ruin this country and they believe they are right

  • Barbara Blough

    The NERVE!!!!

  • Christine

    I’d love to see all these rich bankers dropped into the middle of a mob of people who lost their homes. Most likely, justice would finally be served.

  • PeedroPaula

    God money, I’ll do anything for you.
    God money, just tell me what you want me to.
    God money, nail me up against the wall.
    God money don’t want everything, he wants it all.

    Head Like A Hole – Nine Inch Nails

  • http://posologist.blogspot.com/ Jeff Healitt

    They should be counting their blessings that George Carlin wasn’t elected President. http://posologist.blogspot.com/2012/08/how-to-fix-economy.html

  • Anonymous

    The rich are the the ones who feel they’re entitled. We serfs exist only to serve them,

  • Anonymous

    Brilliant minds…

  • Mike Smith

    Hey Benmosche, here’s a deal. In two parts. First, give me all the money I lost because of AIG and the banks’ mess. Secondly, give my aunt/uncle their business and home back that they lost because of the credit crunch caused by you and your friends mess.

    Do that and then we can talk.

  • Anonymous

    There is no excuse for the behavior of these people except psycophathy that lack of interest by the FBI, DOJ, etc in pursuing criminal investigations seriously is a mystery. Ofcourse there may be many Lanny Breuers around. Hopefully states’ attorneys general & pension fund mgt will take the information that is emerging and run with it.

    Colluding to set interest rates, price fixing in muni bond fund business to keep rates paid artificially low and share the business. Ratings agencies screwing with their models so they could get the ratings results they wanted to keep clients. Interestingly, the infamous London Whale did precisely that to conceal the loses & the regulator has decided that was a crime.

    Now if a ratings agency – all of the big ones actually – changes model assumptions to give triple A ratings to triple F securitzed subprime mortgages how is it they were not pursued. You needed to watch the hearings as i did tp really appreciate how slimey these snakes are and continue to be.

    The same sort are currently wreaking havoc with public pension plans where they csn actually prevent retirees from knowing what fees are being paid to hedge funds and how they are performing. Matt Taibbi’s article in Rolling Stone on public pensions being scammed by corrupt politicians & their hedge fund contributors.

  • Anonymous

    Perhaps the time will come soon where at least they will face the public stocks in shopping malls or better yet farmers markets where there is stuff to throw.

  • IBCat1

    How else would an entitled sociopath feel about it?

  • Just Wondering

    But There Bankers they are better that everyone and we owe them…. Don’t people know that

  • Alisoquoladi

    Excellent reply and right on the money too.

  • L

    They need to be prosecuted for criminal activity with OUR money!!

  • PeedroPaula

    Thank you. :D

  • Alisoquoladi

    Saw a great show with Matt Taibbi this am where he is talking about his article in RS. How the hedge fund managers are ripping off people’s benefits with insider trading and just plain theft and at the very least misappropriation of funds. Charging exorbitant fees and just up to no good as usual. These are the criminals that the gov’t should be going after. They have caused way more grief than street crime. Sure rather see them locked up than the local teen for selling a joint. These people have no conscience and could care less how many people’s lives were ruined and how many homeless people their crap has caused. Make them pay to house the homeless in our communities since they contributed so readily to making them that way. No justice left in America it seems. We reward those that destroy so much while kicking Joe Citizen in the teeth.

  • SamP

    Why is he rewarded by keeping his job? The bonus is just a further insult.

  • standbehindtheyellowline

    Not only by our taxes, their under paid servants (employees) also helped them get that 3rd house in Tuscany where the family goes on just 1 of their many holidays yearly!

  • David Bell

    LET THEM EAT CAKE? : “In 2008, AIG received $85 billion from American taxpayers on top of the funds made available from the TARP program. Less than a week later, a bunch of AIG executives went on a “retreat” to the luxurious St. Regis Resort in Monarch Beach, Calif., where they ran up a bill of almost a half-million dollars, including $150,000 for meals and $23,000 in spa charges.”

  • usualsuspects

    I would rather hear the laments from behind the bars working out a 30 year sentence doing hard time in Pelican Bay or some other hard prison where they can then reflect on the how they are being treated.

  • Jewel

    My brain bleeds! Is there any way to make him experience our reality? I can’t wrap my brain around this pinhead point of view.

  • Anonymous

    You know what? Your bonus is three times what I make in a year. I don’t care how hard your life has become, Mr. Six-Figure-Bonus-On-Top-Of-Your-Salary. You should be in JAIL. The people who lost their homes didn’t get to go on a swanky vacation. The people who lost their jobs didn’t get a bonus.

    Next time, instead of bailing your sorry fat and corrupt a$$ out of trouble, perhaps we SHOULD lynch you. Not only would it save us money, but we wouldn’t have to listen to your pathetic whining about how much you suffered after shafting the rest of us.

  • Anonymous

    They were born on third base and think they hit a home run. Disgusting.

  • http://www.facebook.com/profile.php?id=1572425010 Sylvia L Gooden

    This bit of information should be no surprise to anyone they have been getting away with unshadness for years,all these big executives have the backing of the federal government. So as long as the government does not reprimand them and make them accountable they are going to continue. They will get bonuses no matter what,and we the actually working class get a bonus based on our performance,after the banks etc find out year end quarter earnings,and the executives have already received their bonuses before we get ours, we get the letfovers.

  • propwriter

    One possible way to change this…

    Have public referendums on issues that affect the public. We cannot depend
    upon the Senate for honesty and integrity anymore. We cannot even
    depend upon them to make decisions. (First off, outlaw filibustering.
    If you can’t contribute anything meaningful to the debate on the floor,
    your time is cut off after two minutes.) Things that affect everyone
    are voted upon by everyone. Implement two or three “referendum days” spaced
    over the year to address issues that the Senate has proven their
    impotence on, such as fracking, the XL pipeline, healthcare, alternative
    fuels, senatorial salaries and term limits, senate benefit packages, banking and Wall Street regulations, going to war, etc. Place the important decisions back in the hands of the people. Obviously, Congress is too ill-equipped to handle the task.

  • The Electric Gopher

    AMEN, and with the communication capability we have today it would not be hard to do.

  • IAMROSE

    “They’re all scared,” he told the Journal. “They [had made] good livings. They probably lived beyond their means. We wouldn’t be here today had they not stayed and accepted … dramatically reduced pay…It is a shame we put them through that.”

    He should be saying “They’re all scared,” he told the Journal. They [had made] good livings.” They probably lived from check to check. They trusted us and we let them down. We allowed their savings to dissipate into thin air. How can one dramatically reduce minimum wage jobs or those barely above the poverty line when jobs are scarce? How can we allow people to go homeless because their home was foreclosed by the banks? We should have divided some of the profit amongst those who were having trouble making their utility bills. They may enjoy their profits on this plane, but there won’t be room for them in heaven…Poor penniless bankers…

  • Doug
  • Anonymous

    Mr. Moyers, Am thinking that American has had enough of these ‘crooks’. The ‘plight’, awe yes, their ‘plight’, if it were a real and reasonable world, where the money they have stolen would have them “ALL” in prison; never allowed to work in banking in any way shape or form for the rest of their lives. The fines they would pay would be comparable to what they stole. They are like Madoff, and this was nothing more than a form of Ponzi scheme and they continue to scheme. The fact that they continue to be reported and caught up in the process validates what all Americans know, they should not have received the TARP funds nor the QE3′s. If you look at who helped created the those situation it ‘strongly smacks of cronyism and good ole’ boy attitudes and support. They are no different than the ‘robber barons’ of the old west and it is seen over & over in their deals and crimes. What is really sad it was supported by our “Presidents, Congress and Supreme Court”. What I’d like to know is WHEN DO IT STOP? Why are they being allowed to continue their similar schemes, where is our Justice department. Or is our Justice department also corrupted by them also. A final thought why hasn’t the NSA used all of it’s copies of phone messages, emails etc. to help bring these people to justice, since this is just another form of terrorism? They are ‘allowed’ to continue this terrorism, which really doesn’t make any sense if one is a reasonable, thinking person, given the technology we have. Metaphorically “off with their heads”. There needs to be a stance on this behavior so the world of banking gets it! I’d pose another question of sorts, has anyone realized that of the ‘world’ the only major country NOT taken down by our Bankers was Canada, Why? Because their Bankers were not allowed to change the laws and regulations (thank you Alan Greenspan et al – see ‘The Warning’ on the net is just a tip of the ice berg) that go back over at least 30 years or more. Greenspan helped the Banks with help from those in Congress and those in Banking that come into the Government and then go back to banking (another revolving door). As an example look at Henry(Hank) Paulson, who had work for Goldman Sach from the 1970′s forward and said to have liquidated all his stock in Goldman before becoming head of the Treasury. That being said guess which American bank received the most TARP monies , oh my it was ‘Goldman Sachs”…. Read 13 Bankers, Griftopia, Greenspans Bubbles and so much more. Even in the Justice Department BANKS ~=Lanny Breuer left the Justice Department, as chief _fast-and-furious-white-collar-crime-justice-department for Covington & Burling LLP and I wonder why there were no Wall Street executives sent to jail? “”From “Covington & Burling LLP | Industry | Enforcement Actions & Investigations”… “Covington “defends” banks, thrifts, their holding companies, and their officers, directors, and employees in the full array of regulatory enforcement actions and cases, including safety and soundness issues, fair lending, anti-money laundering, securities and commodities enforcement, international trade controls, and litigation. We represent our clients on enforcement matters brought by all of the federal bank regulators, the SEC, Fin CEN, the U.S. Department of Justice, and state attorneys general. When such regulatory investigations and enforcement actions are accompanied by parallel criminal investigations or Congressional investigations, we are well equipped to handle those as well. We also conduct internal investigations, design corporate compliance programs, and conduct compliance training for clients ranging from the world’s largest financial institutions to community banks. We are recognized by Chambers USA (2010) as one of the nation’s leading firms in the field of Financial Services Enforcement and Investigations…”" Was/is Eric Holder connected to Covington? I’m not saying Eric Holder is connected to them I just want to know why our Justice Department doesn’t find these connections more than ‘worry some’!

  • Mark Wallin

    Is he feeling a rope around his neck ? Well maybe there should have been one. If you steal from a bank you go to jail but if a bank steals from you they get a Bonus .

  • Charles Robinson

    Taking him out and literally hanging him from a tree wouldn’t morally compare to lynchings in the Old South, since they were often conducted without any reason other than racial hatred. The economic destruction of the crimes and frauds committed by him and his peers undoubtedly have caused countless deaths and untold suffering. He deserves to be in prison, where he could viscerally know what a victim feels like.

  • Joel W.

    Should we all send him a dollar?

  • Chuck

    As long as we continue to borrow what should be our sovereign currency, as per Article 1, Section 8, Clause 5 of The US Constitution, from these criminal psychopaths who literally create it out of thin air, We The People will not likely see any of them brought to justice. The certainly will never assume any responsibility. They have the monopoly on creating money, and therefore the ultimate power over everything from how much food you can buy your family to whether you will have a job next year to who gets elected and what laws they write and enforce. Until we take the money creation power back, as advocated by both William Jennings Bryan and Milton Friedman, don’t expect anything to change: LIBOR, MERS, robo-signing, other fraudulent foreclosures, too-big-to-fail, too-big-to-jail,bail-outs,bail-ins, domestic spying, false-flag wars and corrupt campaign financing, amongst other Constitutional violations. The banks create our money, so they run the show.

  • Anonymous

    Pitchforks and torches sound pretty damned good to me right now.

  • Anonymous

    Benmosche is nearly as clueless as Mitt Romney

  • Dip

    It’s been said that the DOJ did not pursue the issue because they thought they would lose. I believe they were afraid of being murdered.

  • MD

    Two words: WOLF PAC (wolf-pac.com)

  • David Andrew

    Once again the story centers on the bonuses at AIG, when the story should be about the 100% payoffs by AIG of the credit default swaps (CDS) connected to the “mortgage backed securities” all but wrecked our economy. Why bailout AIG instead of letting it go bankrupt, particuarly covering the CDS contracts on mortgage-backed bonds is the big story! The bailout of AIG was a back door bailout of the exact fraudulent bankers that has ripped off countless homeowners with their ballon mortgage settups.

    According to an article at the Harvard Buisness Review:

    “AIG had sold … a huge volume of credit default swaps (CDS) — obligations of AIG to pay the full face value of designated bonds if the issuers were to default. Many of these bonds were backed by mortgages, whose values deteriorated sharply during the summer of 2008. In response, AIG executives tried to persuade these banks to settle its CDS obligations at a 40 percent discount to the face value of the relevant bonds.

    Then, on September 16, 2008, the federal government took over almost 80 percent of AIG’s stock in return for an $85 billion line of credit, which was later increased to over $180 billion in other loans and investments.

    During the first week of November, 2008, the Federal Reserve Bank of New York — with the current Treasury Secretary Timothy Geithner as its then president — took over the negotiations with the large banks owning CDS contracts with AIG. After a week of negotiations, the New York Fed instructed AIG to settle these CDS contracts by paying the full face value of all the relevant bonds — $62 billion, as compared to their then market value of less than $30 billion.” …

    “Some observers point out that Stephen Friedman, the chairman of the New York Fed, [was] a director of Goldman Sachs. Goldman received almost $13 billion in settlement from AIG”

    AIG: The Secret Bailout by Robert C. Pozen, November 23, 2009
    http://blogs.hbr.org/2009/11/aig-the-secret-bailout/

  • Anonymous

    He’s already gotten enough of mine

  • Anonymous

    They’re bought just like those on the right.

  • Rob Canny

    Well if they are “suffering” at those vulture capitalist Wall Street jobs of theirs with “dramatically reduced pay” and $121,000 bonuses just to keep those criminal too big to fail investment banks open, maybe we can oblige them by breaking up their house of cards?

    If they’re so important and smart, I’m sure they’ll have no problem finding another job somewhere else. Like maybe McDonalds or Walmart?

  • Anonymous

    Get a better job, working for a better company than those soul-sucking leeches.

  • Anonymous

    He is rewarded by the market. The more money AIG makes, the better paid he’ll be, too. The ONLY answer is for us to stop purchasing their services, and divest ourselves of any portfolio holdings that benefit AIG.

    They may be too big too jail, but by God, if we ever get the chance again, I’ll be happy to let them fail.

  • Steve

    seriously? I wonder how many death threats he will receive….

  • Anonymous

    Say What!!! These overpaid frauds collected big bonuses marketing unsuitable investments to – what were the descriptors used in emails – muppets? ” lets put some lipstick on these pigs ..” these mgrs are clueless and calling them leaders is offensive.

    I remember UBSC going to the Swiss asking that bonuses not be capped since their London staff had private school tuition to pay and mortgages (note the plural) and needed that money. As if the towns and communities put into high-risk, unsuitable investments so they could get a bigger bonus. Either they did not understand the risks inwhich case they don’t deserve a high-paying job, or they knew exactly how unsuitable they were and pushed them anyway. In that case the are dishonest and should have been fired or preferably jailed.

  • Anonymous

    fyi, this was on TV, I think PBS, about “Lanny Breuer left the Justice Department, as chief _fast-and-furious-white-collar-crime-justice-department for Covington & Burling LLP
    and I wonder why there were no Wall Street executives sent to jail? “”From “Covington & Burling LLP | Industry | Enforcement Actions & Investigations”…
    “Covington defends banks, thrifts, their holding companies, and their officers, directors, and employees in the full array of regulatory enforcement actions and cases, including safety and soundness issues, fair lending, anti-money laundering, securities and commodities enforcement, international trade controls, and litigation. We represent our clients on enforcement matters brought by all of the federal bank regulators, the SEC, FinCEN, the U.S. Department of Justice, and state attorneys general. When such regulatory investigations and enforcement actions are accompanied by parallel criminal investigations or Congressional investigations, we are well equipped to handle those as well. We also conduct internal investigations, design corporate compliance programs, and conduct compliance training for clients ranging from the world’s largest financial institutions to community banks. We are recognized by Chambers USA (2010) as one of the nation’s leading firms in the field of Financial Services Enforcement and Investigations…”"Laney Brewer was suppose to be looking into these banking issues while ‘doing his job at the DOJ but it is obvious at least on the surface he was covering up and protecting, while hedging his bets and setting himself up for a future job. I just wondered ” Was/is
    Eric Holder connected to Covington in any way” that was not implied in the show, just my inquiring mind and him being the head.