If the recent attempt to gut the 1965 Voting Rights Act was a reminder that eternal vigilance is indeed the price of liberty, then the $2 billion trading loss by J.P Morgan is an equally painful reminder that we can ill afford to heed the calls for less regulation by the nation’s top bankers.
JP Morgan Chief Executive Officer Jamie Dimon, a leading advocate for less regulation, recently acknowledged that his firm “mishandled” a massive derivatives investment gambit.
The announcement by Dimon renewed fears that Wall Street still has the potential to trigger massive losses for individuals who rely on banks to protect pension portfolios and other investments. Dimon responded to criticism and calls for his removal with a disturbing mix of hubris, contempt and condescension, essentially saying, “Back off. We bankers know best.”
“Consumers, communities and individuals invariably pay a high price whenever an industry has been deregulated, whether it was airlines, energy, telecommunications or banking,” said IAM President Tom Buffenbarger. “We’re told that government regulations impede free trade and free markets, but that’s lobbyist hogwash. Industries are simply incapable of regulating themselves and anyone who thinks otherwise needs to look no further than the U.S. mining industry.”