a day for pitchforks

It’s the best of times for Goldman Sachs, and the worst of times for the rest of us.

Ironic that this news would break on Bastille Day:

Goldman Sachs’ profits for the second quarter smashed Wall Street estimates and are likely to trigger a windfall for bankers.

The bank, long considered the most prestigious and profitable on Wall Street, recorded net profits of $3.44bn in the last three months, up from $2.1bn in the same period in 2008.
…
Goldman, led by Lloyd Blankfein, has already repaid the $10bn it borrowed from the US Government last year, liberating it from restrictions on pay imposed on those institutions which have relied on taxpayers’ cash.
…
Mr Viniar said that the company had benefited from the loss of some of its competitors in the investment banking business. “There is definitely less competition out there,” he said, adding that there is also less risk capital available.

“Goldman’s got a sweet spot in here, they were the go-to players,” Peter Sorrentino, a fund manager at Huntington Asset Advisors, told Bloomberg News. “For the time being, they’ve got kind of an open playing field all to themselves.”

Goldman Sachs CEO Hank Paulson guaranteed that open field when he refused to lend a hand to Lehman Brothers, causing panic after money markets “broke the buck” and leading to the credit crisis we’re still enjoying today.

If you haven’t been reading Matt Taibbi in Rolling Stone on the unholy alliance between Goldman Sachs, the Fed, the U.S. Treasury and the World Bank, you’re probably not seething with fury right now about Goldman playing Midas while the average American fights to keep his/her head above water. The word corruption doesn’t even cover it, unless it’s in the sense of the raped and battered body of our democracy putrefying beneath the overladen banquet table at which Goldman alums suck the marrow from the bones of taxpayers and pensioners:

By now, most of us know the major players. As George Bush’s last Treasury secretary, former Goldman CEO Henry Paulson was the architect of the bailout, a suspiciously self-serving plan to funnel trillions of Your Dollars to a handful of his old friends on Wall Street. Robert Rubin, Bill Clinton’s former Treasury secretary, spent 26 years at Goldman before becoming chairman of Citigroup – which in turn got a $300 billion taxpayer bailout from Paulson. There’s John Thain, the rear end in a top hat chief of Merrill Lynch who bought an $87,000 area rug for his office as his company was imploding; a former Goldman banker, Thain enjoyed a multibillion-dollar handout from Paulson, who used billions in taxpayer funds to help Bank of America rescue Thain’s sorry company. And Robert Steel, the former Goldmanite head of Wachovia, scored himself and his fellow executives $225 million in golden parachute payments as his bank was self-destructing. There’s Joshua Bolten, Bush’s chief of staff during the bailout, and Mark Patterson, the current Treasury chief of staff, who was a Goldman lobbyist just a year ago, and Ed Liddy, the former Goldman director whom Paulson put in charge of bailed-out insurance giant AIG, which forked over $13 billion to Goldman after Liddy came on board. The heads of the Canadian and Italian national banks are Goldman alums, as is the head of the World Bank, the head of the New York Stock Exchange, the last two heads of the Federal Reserve Bank of New York – which, incidentally, is now in charge of overseeing Goldman…

Taibbi’s reporting on this is stunning and sickening, and despite every attempt of Golmanites to make their business too complicated for the layman to understand, Taibbi makes it clear that what we’re talking about are, at base, the oldest of crimes: Fraud. Theft. Insider trading.

Our problem is that Goldman has become so enmeshed in every level of government that our representatives in Congress, our executive branch, and our justice system (headed by corporate leg-humper John Roberts) feel a much greater affinity for the Goldman Masters of the Universe than they do for the average American taxpayer. (This happens at the local level, as well: Hank Paulson’s son, Merritt Paulson, is very busy right now jerking Portland around, threatening to pull his AAA Portland Beavers from the city if we don’t build him a new stadium, freeing up PGE Park for his major league soccer franchise.)

We may not be ready to storm the Bastille, but honestly, I don’t know what else will move them.