Bill Black: Wall Street Declares War Against Bernie Sanders

Yves here. Notice how Black has caught out Krugman as as defender of leaving the bank oligarchs in charge.

By Bill Black, the author of The Best Way to Rob a Bank is to Own One and an associate professor of economics and law at the University of Missouri-Kansas City. Originally published at New Economic Perspectives

Wall Street billionaires are freaking out about the chance that Bernie Sanders could be elected President.  Stephen Schwarzman, one of the wealthiest and most odious people in the world, told the Wall Street Journal that one of the three principal causes of the recent global financial trauma was “the market’s” fear that Sanders may be elected President.  Schwarzman is infamous for ranting that President Obama’s proposals to end the “carried interest” tax scam that allows private equity billionaires like Schwarzman to pay lower income tax rates than their secretaries was “like when Hitler invaded Poland.”

Schwarzman and Pete Peterson co-founded the private equity firm Blackstone.  Peterson leads the effort to destroy the safety net in America.  His greatest dream is to privatize Social Security so that Wall Street could increase its revenues by tens of billions of dollars.  Blackstone is a major owner of Sea World, and it was in this sphere that Schwarzman went beyond his delusional rants about Hitler and became vile.  When an Orca killed its trainer, Schwarzman lied and blamed the death on the trainer, claiming that Sea World “had one safety lapse — interestingly, with a situation where the person involved violated all the safety rules that we had.”

Schwarzman’s claim that the global financial markets are tanking because of Bernie’s increasing support is delusional, but it is revealing that he used the most recent market nightmare as an excuse to attack Bernie.  The Wall Street plutocrats, with good reason, fear Bernie – not Hillary.  Indeed, it is remarkable how vigorous and open Wall Street has been in signaling through the financial media that it has no problem with Hillary’s Wall Street plan.  CNN, CNBC, and the Fiscal Times, under titles such as:  “Here’s Why Wall Street Has Little to Fear from Hillary Clinton,” pushed this meme.

Michael Bloomberg was the second Wall Street billionaire to pile on to Bernie this week.  Bloomberg leaked to dozens of media outlets that he was again considering a run for the presidency.  The same leaks explained that Bloomberg’s fear of Bernie was the key.  Bloomberg is infamous for organizing the mass arrests designed to crush the Occupy Wall Street movement.  He is Wall Street and he openly represented Wall Street as Mayor of New York City.

Mayor Bloomberg today accused the Wall Street demonstrators of trying to cripple the city’s economy.

“What they’re trying to do is take the jobs away from people working in this city,” the mayor declared in his harshest criticism of the three-week-old protest that has caught the attention of the nation.

Mayor Bloomberg was outraged that Wall Street banksters were criticized for their roles in leading the world’s largest criminal enterprises.  Bloomberg invented a fictional alternate history in which the banksters were the victims of Congress, which purportedly forced them to make millions of bad and fraudulent loans – and then to sell the fraudulently originated loans to the secondary market through fraudulent representations and warranties.  This is deranged, but Wall Street billionaires are deranged.  They are surrounded by media, gofers, and politicians who treat their incoherent ramblings as genius.  Bernie scares all of these groups.

Why do the Wall Street billionaires hate Bernie?  Paul Krugman, unintentionally, provided the key in his most recent attack on Bernie.  Krugman claimed that the key to what he claimed was President Obama’s success was not “breaking” “Wall Street’s power” over our economy and democracy.  To Krugman and Hillary’s horror, however, Democratic voters, like the median U.S. voter, understand that breaking the paramount power of the Wall Street billionaires over our economy and its political power that has caused us to descend into crony capitalism is essential to take back our Nation.

Political scientists’ research has revealed the crippling grip on power that the Wall Street billionaires have in practice and the fact that the wealthy have, on key public policies, strikingly different views than do the America people.  In particular, the 1% are exceptionally hostile to Social Security and anything that protects the weak from predation by the wealthy.  They are also stunningly unconcerned about problems such as global climate change while they are paranoid about debt, deficits, and inflation even during the depths of the Great Recession.  The domination of the plutocrats of our economy and the shards of our democracy has led to decades of terrible policies designed to ensure that financial regulation will fail.  These policies have crushed the middle class and abused the poor.

Read Tom Frank’s New Book

Read Tom Frank’s blockbuster new book about the shameful history of the “New Democrats’” alliance with these plutocrats.  Reading simply the passages explaining Bill Clinton’s shameful effort, in a cynical deal with New Gingrich, to begin to privatize Social Security in order to transfer tens of billions of additional dollars from the American people to Wall Street and put all our retirements at risk is worth the price of the book.

You don’t have to watch the polls to know how well Bernie is doing.  Just listen to the intensity of the billionaires’ bleating about Bernie.

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  1. Disturbed Voter

    The malefactors of wealth, always pretend to pee their pants, when controlled opposition has an even chance.

    1. AJ

      You, Disturbed Voter, get all my internet points for today. I’ve read this comment several times and it gets better every time. Might I suggest putting it in the proper form? (did you intend the rhyme or was it pleasant happenstance?)

      To wit:

      The malefactors of wealth
      Always pretend to pee their pants
      When controlled opposition
      Has an even chance

      1. Disturbed Voter

        It is a broken rhyme, just like our political-economy … a sad but fortuitous triple entendre.

  2. cnchal

    Schwarzie, isn’t he the pirate equity kingpin that “invested” $6 million for his 60th birthday party?

    No doubt structured as a before taxes expense. Opulence is a tax deduction.

  3. Steven D.

    The big tell that Wall Street is freaking out about Bernie was Obama yesterday calling him a bright, shiny object distracting voters from Hillary, whom they should be supporting.

    1. RUKidding

      Ha! I noticed that, as well. I’ll speculate wildly (based on nothing, so no links) that I feel that there’s no love lost between the Barackstar and Hillz, but I figured the Wall St Money Boyz done told Bamz to say something in support of their gal, Hillz, STAT. And thus it was so.

  4. Brooklin Bridge

    On the one hand, alas, Wall Streets paranoia about Bernie is not an accurate indicator of the extent of Bernie’s success, only that Wall Street scares easily. On the other hand, hurrah!, that same paranoia, the attacks, the lies, are all helping to make what the elite fear most come true. These fiascoes, such as Bloomberg’s threat of a presidential run, are really making people take notice and what they see coming from the TV (to name one outlet) doesn’t make sense, whereas what Sanders keeps saying does. The attacks are largely counter productive!

    1. andyb

      But the paranoia is not only about Bernie; there’s an awakening groundswell of J6Ps against the banksters. Comments on alternative financial media sites mention nooses, guillotines, castration, etc. And the articles about $1million bunkers, and remote desert island purchases certainly add fuel to the fire.

  5. Thomson von Stein

    For Mrs. Clinton, experience means, “Well, yes, I did get it wrong the first time, but now I get it right.” For Bernie, judgment is getting it right the first time, not after the barn burned down. Bernie never hired a bunch of Wall Street operatives to advise his campaign.

    1. readerOfTeaLeaves

      If NC comments were baseballs, you just hit this one outta left field.
      I tip my cap.
      Truly ;-)

    1. RUKidding

      Well, Bernie will TRY, I think, but it’s unclear how successful he’ll be. Nonetheless, I’d enjoy watching someone actually TRYING for a change (eg, surely didn’t happen with Obama, now did it??? ).

      1. readerOfTeaLeaves

        Difference between Bernie and Hillary:

        Hillary: “I’ll clean up Wall Street all by myself, even those guys who paid me $225,000 per speech, even the people that I take money from. I’ll hire Merry Maids to come in and clean up. I will earnestly, nearly killing myself with effort, exhaust myself and work my fingers to the bone to save you all.”

        Bernie: Listen up people, “You’re adults. Haul ass and get yourselves organized. I can do a lotta heavy lifting, but this won’t happen unless you all pitch in and do your share. We do that, there’s enough for everybody. And maybe we outta get some hot dogs ready, ’cause we outta get our baseball gloves and get a softball game going after we clean up this Wall Street mess. Who’s bringing the ketchup? And mustard? We’re gonna need a LOT of mustard!”

      2. AnEducatedFool

        The Executive Branch has tremendous power. He can bring them to justice if he brings along someone like a Bill Black into his administration. The President needs to an AG that will go after Wall Street. I don’t know how the courts will handle it but I will settle for a President that makes the effort to bring them to justice and not actively look the other way.

  6. PlutoniumKun

    Any politician should consider it a badge of honour to have someone like Schwartzman hate on him.

    1. afisher

      I totally agree. Now shouldn’t we all rally to raise funds to pay for that badge. Just sayin – talk is cheap, let’s hope everyone in agreement is backing up their statements with financial support for Bernie.

  7. crittermom

    GREAT article. Thanks, Yves.

    Hmmm……….99% vs 1%.
    C’mon folks——-VOTE! This one could be close & your vote DOES matter. (As a victim of the banksters who lost everything of 64 yrs, I must believe that. It’s all I’ve got left).

    1. TedWa

      I’m with ya. If you’re too apathetic to vote, you need to consider that you’re doing it not necessarily for your own sake, you’re doing it for your family, your friends and your community – the future of America depends on it.

      “Well, Doctor, what have we got—a Republic or a Monarchy?”

      “A Republic, if you can keep it.”

      Dr. Benjamin Franklin (1706–90)

  8. Rhondda

    I used to be a Krugman reader back in the noughties. But he’s become like David Brooks for me. My skin crawls. I experience a deep, almost spiritual feeling of “pollution revulsion” when I encounter his thoughtforms. I will have to work to develop some sort of prophylactic gestures or utterances to protect my mind from Krug pollution — the Establishment Evil Eye. That middle finger thing has become too generic. I need something specific and efficacious.

    1. Eclair

      Yes, Rhondda. Have I changed or has Krugman gone over to the Dark Side? Hmmmm.

      As for prophylactics, I find loading my pockets with garlic cloves works wonders.

      1. Steven D.

        PK’s latest: it’s not just Konczal and me defending Hillary. Now it’s the Big Progressive Kahuna, Barack Obama, so QED and STFU Bernie fans. That’s rich. PK used to have useful criticisms of BO’s sell outs. Now he portrays Obama as the progressive leader. Obama is progressive under Cuomo’s definition, which is tied totally to identity politics. In the real world, he’s Wall Street’s biggest defender. Nauseating, Krugman. Just nauseating.

    2. Wat

      Put a folder on your desktop with nothing but Mike Whitney, Michael Hudson, Bill Black and Pam Martens in.

      1. oswarz

        Add Richard Wolff, Mark Blythe, Yanis Varoufakis and that guy from Australia whose name I can’t remember.

  9. Pookah Harvey

    Here’s an excerpt from a 2013 article from Politico “Lament of the Plutocrats”

    “a shift back to Wall Street’s historic Republican roots is by no means a given, especially if the Democratic nominee is local favorite Hillary Clinton—and the former New York senator has been shrewdly tending to would-be donors for much of the last year,……The worry on Wall Street is about how far to the left Clinton might have to drift to appease what’s been proclaimed the “Warren wing of the Democratic Party”…..Still, some say fears that Clinton will end up alienating financial sector donors the way Obama has, even if she tacks left, are overblown. “Wall Street folks are so happy about [having Clinton run] that they won’t care what she says,” says one well-placed Democrat.”

    as compared to this from a Bloomberg portrait of Sanders

    “When asked…what he(Bernie) would say to reassure the Bloomberg-Businessweek readers who work on Wall Street, or have millions of dollars, or run a hedge fund… ‘I’m not going to reassure them,’ he says. ‘Their greed, their recklessness, their illegal behavior has destroyed the lives of millions of Americans. Frankly, if I were a hedge fund manager, I would not vote for Bernie Sanders. And I would contribute money to my opponents to try to defeat him.’”

    “Sanders declared his own war on organized money… vowing to break up the six largest banks…’The reality is fraud is the business model of Wall Street,’ he said.’It is not the exception to the rule. It is the rule.’”

    1. AnEducatedFool

      How does anyone read those quotes and think that Bernie is a trojan horse like Obama or that this is another example of lesser than two evils…at least in economics.

      Foreign policy is another ball game. I really look forward to seeing who he has advising him in that arena has the primary season progresses. I hope that he will want to break with the Wahhabist extremist.

    2. phichibe

      Thanks for the Bloomberg article. I love the title “Why Bernie Sanders Doesn’t Want Your Vote
      On the road with a man so angry he scares Democrats, too.” This is supposed to be a reporting piece? It’s scandalous that Bloomberg is using his press just like Rupert Murdoch. I was just thinking that Trump was like Berlusconi in Italy but maybe the more apt comparison is Bloomberg. Nauseating.


  10. Vatch

    Schwarzman’s claim that the global financial markets are tanking because of Bernie’s increasing support is delusional

    Very delusional, and reminiscent of the religious enthusiasts who claim that hurricanes or earthquakes are caused by God’s (or Allah’s) vengeance against sinful behavior. The cause and effect does not exist, but people still believe it.

  11. RUKidding

    I had a good laugh to witness Bloomberg “threatening” to run. I figured his 1% pals (those that aren’t in the Trump camp) put him up to it. Some friends of mine got a little excited about it. Not me. What a poseur. Of course, Wall St hates Bernie. He openly calls himself a socialist, and now the little people are helping make a credible campaign look like it might just make it.

    Heaven forfend that these .0001% “hard workers” should ever have to, you know, pay taxes!! Why taxes are just for the little people.

  12. steelhead23

    Schwarzman is shilling for Clinton. That tells you all you need to know about who’s side she’s on.

      1. optimader

        Does she really have friends or are they just co-conspirators?
        Maybe Huma?… but even then, based on (what I think) Huma’s selection criteria for a husband was, I think she’d sell HRC’s organ meat if push came to indictment.

        1. NotTimothyGeithner

          Brown nosers and groupies. Clinton patronage is a necessity for much of the pundit class. Obama left no establishment, so without Hillary much of her more prominent supporters would have to stand on their own. Let’s be honest, would an Iraq war monger and Wall Street devotee be doing well in the Democratic nominating contest if there wasn’t a bizarre decades long myth around them?

    1. John

      Reps can’t win without Fl.
      Veep should be compatible and help bring in a large state that might otherwise go to other side.

      Charlie crist, former Fl gov, surprisingly liberal record except guns. Switched from rep to dem… Note Bernie’s not either.
      Good looking, southerner, a young 60… Good balance for Bernie.
      Running for congressman this year as dem… Maybe he’ll campaign for Bernie…

      1. NotTimothyGeithner

        Yeah…except Christ was a Republican every day of 43’s administration. Let’s aim for higher goals, not the dead end goals of say a DWS. This is a countyr of 300 million, not 10 people. Of course, Christ lost to Lex Luthor as the Democratic candidate.

        If he Democrats nominate a Republican, they lose 15% of their base no matter how much of a nice guy that Republican might be.

      2. hunkerdown

        Why do people want “ex-” Republicans to take over the Democratic Party? Isn’t it right wing enough?

        1. Strangely Enough

          Why do people want “ex-” Republicans to take over the Democratic Party?

          Would appear that’s already occurred…

    1. NotTimothyGeithner

      I’m not certain this is true. Obama surged in 2012 after he started to make liberal promises, but that sense of good feeling disappeared when he attacked social security. My guess is too many people have been burned. With control of the Senate at stake, the Democrats couldn’t scare women into voting in 2014 even when Hillary made campaign appearances. Turnout in 2014 was almost non-existent for both parties.

      I think a Rubicon style event has occurred in the life of the Democratic Party. She might even under perform 1992 Bill with his 27% of the electorate, a historic low.

  13. Pespi

    The finance sector are like armor clad horse warriors who invaded some quiet little island, looted the churches, took the harvest for themselves, decided they liked it enough to stay, and made themselves royalty. Now they claim the right to extract as much as they’d like, and if anyone objects they scream and howl about the sacred laws, and then get out the head chopping swords.

    Money is fake, money is a token for rules, it’s a metaphor for power relations. At some point we need to collectively realize this, and we need to realize that being born to a family with less tokens should not be a sentencing to a life of woe.

    There is no reason to allow some tiny group of people to extort and immiserate, because they have more tokens. We outnumber them by the billions. We need to get together and throw off these chains.

    I am looking forward to Thomas Frank’s new book.

  14. freedomny

    Obama to have private chat with Bernie Sanders on Wednesday …

    Well just saw that headline…. and I am not a Washington insider. Is Obama going to give Sanders “scary” news to make him back down from his populist message. And if so….will Sanders get scared AND back down?

  15. rps

    I’ll vote for Bernie if he guarantees Elizabeth Warren as the VP. Bernie wants votes? Well voters demand an iron-clad written in blood and cast in stone agreement.

    1. Teejay

      I’m an unabashed EW supporter. That said, Bernie’ll need her leadership when Senate Dems caucus far more than a VP spot. If wishing were so I’d have an EW type in every domestic post –especially the DOJ and Supreme court seat.

  16. Malcolm MacLeod, MD

    Being a big fan of Bill Black’s, his article was pretty much as expected, but what I found fascinating
    was the preponderance of pro Sen. Sanders’ comments. This really warmed my heart. I also become
    emotional when I see his campaign video, and it reminds me of the old days.

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