Sympathy for the Defendant at The Goldman Sachs Hearings

I realize that it’s kind of in the American DNA to dislike bankers and other kinds of money-man high rollers, but it’s also in our DNA (I hope, down in there somewhere) to hate grandstanding nitwit politicians.  As much as you may hate “Wall Street fat cats” (And geez, can we give that cliche a rest? Are we living in an episode of Lil’ Orphan Annie?  Let’s go back to calling them “robber barons” for a change.), the lunkheads that Goldman Sachs executives have to deal with during these sham congressional hearings have to almost make you feel sorry for them.

Arnold Kling puts a fine point on it:

Basically, the McCarthy era never ended. The objective of every Congressperson at every hearing is to get on the evening news by bullying a witness. The only question I have is whether McCarthy is the one who started it, or whether he happened to be the one guy who got called out on it.

Too bad somebody at Goldman could not have called out a Senator. It must have been tempting to say, “Look. You can’t make a market by bending over backwards giving buyers every reason not to buy and sellers every reason not to sell. Sophisticated investors understand how we operate. Just like everybody who goes to play blackjack understands that some of the cards are dealt face down. You can complain that you think all the cards should be face up, but that would totally change the game. Do you hold to such high standards in your election campaigns? Do you think your disclosure of the consequences of your votes is honest? Do you disclose how lobbyists told you to vote? Do you go out of the way in your campaigns to give people all the possible reasons not to vote for you? You want to tell me about my responsibility to my clients? How would you like to hear my opinion about your responsibility to your constituents?”

Blame deflection. That is what this whole financial “reform” theater is all about.

Real life in Washington is becoming like a parody, even more so than usual. Most members of Congress couldn’t balance their own checkbooks if you put a gun to their heads.  But they felt free to stick their interfering arm into the mortgage markets all the way up to the elbow, and of course, they screwed everything up royally.  Now the economy is in the dumps, all the bailouts and stimuli aren’t bailing or stimulating, and they need to put somebody on the hook. The motivation of the players in this farce is so transparent, they might as well have sinister organ music playing in the background when they talk.

The success of many modern politicians is based on their ability to plumb the ignorance of their constituents. I hope they have miscalculated, and we can prove them all wrong in November.

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