A Parable Comes to Life in Washington DC, Elizabeth Warren Edition
Once upon a time, a famous storyteller was walking with his friends, headed for the capital city. “Who is the greatest?” asked one of them. The storyteller thought of the people of that city, and the people they saw on the roads along the way — shopkeepers and merchants, soldiers and private security people, widows and poor folks, religious and political leaders, farmers and fishermen, immigrants and foreigners, children and beggars — and answered “whoever becomes humble, like this little child.”
His friends looked at each other, and pushed the storyteller further to explain himself. Instead of explaining, the storyteller told a story:
Once upon a time, there was a king who wished to settle accounts with his slaves. When he began the reckoning, one who owed him ten thousand talents [ed.: about the combined annual wages of 5 million ordinary workers] was brought to him; and, as he could not pay, his lord ordered him to be sold, together with his wife and children and all his possessions, and payment to be made. So the slave fell on his knees before him, saying, ‘Have patience with me, and I will pay you everything.’ And out of pity for him, the lord of that slave released him and forgave him the debt. But that same slave, as he went out, came upon one of his fellow slaves who owed him a hundred denarii [ed.: about three month’s wages for one ordinary worker]; and seizing him by the throat, he said, ‘Pay what you owe.’ Then his fellow slave fell down and pleaded with him, ‘Have patience with me, and I will pay you.’ But he refused; then he went and threw him into prison until he would pay the debt. When his fellow slaves saw what had happened, they were greatly distressed, and they went and reported to their lord all that had taken place. Then his lord summoned him and said to him, ‘You wicked slave! I forgave you all that debt because you pleaded with me. Should you not have had mercy on your fellow slave, as I had mercy on you?’ And in anger his lord handed him over to be tortured until he would pay his entire debt.
The Big Bankers don’t like this story. No, they do not like it at all. Elizabeth Warren offers us a few clues as to why:
In recent years, many Wall Street institutions have exerted extraordinary influence in Washington’s corridors of power, but Citigroup has risen above the others. Its grip over economic policymaking in the executive branch is unprecedented. Consider a few examples:
- Three of the last four Treasury Secretaries under Democratic presidents have had close Citigroup ties. The fourth was offered the CEO position at Citigroup, but turned it down.
- The Vice Chair of the Federal Reserve system is a Citigroup alum.
- The Undersecretary for International Affairs at Treasury is a Citigroup alum.
- The U.S. Trade Representative and the person nominated to be his deputy – who is currently an assistant secretary at Treasury – are Citigroup alums.
- A recent chairman of the National Economic Council at the White House was a Citigroup alum.
- Another recent Chairman of the Office of Management and Budget went to Citigroup immediately after leaving the White House.
- Another recent Chairman of the Office of Management of Budget and Management is also a Citi alum — but I’m double counting here because now he’s the Secretary of the Treasury.
That’s a lot of powerful people, all from one bank. But they aren’t Citigroup’s only source of power. Over the years, the company has spent millions of dollars on lobbying Congress and funding the political campaigns of its friends in the House and the Senate.
Citigroup has also spent millions trying to influence the political process in ways that are far more subtle—and hidden from public view. . . .
Citigroup has a lot of money, it spends a lot of money, and it uses that money to grow and consolidate a lot of power. And it pays off. Consider a couple facts.
Fact one: During the financial crisis, when all the support through TARP and from the FDIC and the Fed is added up, Citi received nearly half a trillion dollars in bailouts. That’s half a trillion with a “t.”
Oh, my. And that’s just one bank.
How did the banks do, when the shoe was on the other foot and they were the ones dealing with the people in need? In December 2012, Bloomberg described it like this: “In the peak year of 2010, banks took back an average of 87,542 homes a month on the way to a record 1.05 million completed foreclosures, according to RealtyTrac.”
Yeah, the Big Bankers don’t like that old story at all.
You know, there are a lot of members of Congress who profess to like that old storyteller a lot. It’s mystifying to see them rewarding the banks and ignoring that old story — mystifying until we go back up and reread what Elizabeth Warren said.
Those members of Congress may say they like the old storyteller, but after watching them at work these last few days, a lot of them sure don’t act like they like the stories he told.
h/t for the video above to Elizabeth Warren, both for the content of her comments and for providing the video of them to the public in an easy-to-use form.