Krugman Takes On the Angry Rich But Misses Their Pompous Pieties

In a New York Times Op-Ed Monday titled "The Angry Rich" Paul Krugman railed against the angry rich as "decision time looms for the fate of the Bush tax cuts." He cited the financial wheeler dealers who had been bailed out with taxpayer funds but were furious that the price of these bailouts included temporary limits on bonuses. He concludes his missal with the appropriate incantation that for the financial nabobs "sacrifice is for the little people."

In all, tough words. But then, even before one can put the paper down appears a jaw dropping validation of Krugman's observations. There comes one of the doyens of the financial establishment, Charles Munger, the Vice Chairman of Berkshire Hathaway and long time associate of Warren Buffett, having told University of Michigan students but a week before that "we shouldn't be bitching about a little bail out" of the banks. And then, adding insult to this deeply self interested observation, we are all instructed by this multi-billionaire that the country's unemployed should "suck it in and cope."

This from one half of the Vaudeville Act (together with Warren Buffett, see "The Goldman Sachs Settlement, The Wall Street Journal, Warren Buffett and the White House" 07.25.10) that traveled the country to wherever they could find someone with ink to print or a microphone or television camera to laud and exculpate Goldman Sachs for all its daring do with Abacus deals, CDOs, AIG covered CDS', Derivatives, Greek financial engineering, Tankers at anchor oil trades, and on. Here's Munger on Forbes TV commenting on Goldman's behavior. "Given the world they were in they did OK" and "There are things perfectly legal to do and that everyone is doing and will earn a lot of money," by way of exculpation of Goldman. No "suck it in and cope" here.

Mr. Munger and especially Mr. Buffett are exemplary philanthropists and have advanced their social obligation to their communities with great commitment. But here again a great swath of Americans whose sense of personal identity and pride was tied to their eleemosynary activities in their communities are now bereft of even this intrinsically important part of their lives. The tithe of zero is zero. Worse, in too many cases, to their grave personal dismay, they have become the recipients of philanthropy rather than the givers.

With Berkshire billions invested in Goldman Sachs, Wells Fargo & Co. and the risk of their having to put up additional billions as collateral under the new financial regulation bill, Mr. Munger, Mr. Buffett left no stone unturned, no political access to even the highest reaches of government unattended, in order to formulate bailout and financial regulation policies supportive to their interests. No "suck it in and cope" here whereas the "suck it in and cope" crowd, without means, without access were left dangling to their own devices. One set of rules for Wall Street, one set of rules for Main Street. What's wrong with this scenario? Something very basic to what once was our understanding of America. And it needs fixing NOW!