An Andrew Ross Sorkin column is beginning to take on a ritualistic feel. Sorkin is The New York Times ’s M&A ace, Dealbook maven, CNBC host, he of the large Rolodex, author of the semi-official insider’s view of the financial crisis. The ritual goes like this: he writes something more or less sympathetic to the banks’ point of view, on Glass-Steagall or whatnot, which at the same time rather bravely pushes back against popular anti-bank feeling and cravenly aligns himself with sources and other Dealbook/CNBC constituents. Then bloggers, often left-leaning, object, the show ends, and we await next week’s episode. (We’re not above it, but we also go the other way.)
Sorkin this morning expresses sympathy for Jamie Dimon, who feels it is unjust for the government to sue his bank, JPMorgan Chase, for frauds done by Bear Stearns when JPMorgan only bought Bear in an emergency in the first place at the behest of, yes, the government.
Dean Baker and Yves Smith take issue, both arguing, among other things, that Dimon has only himself to blame because he failed to obtain some waiver of legal liability for Bear’s sins/crimes.
As Yves says (her emphasis):
Jamie’s little problem is that he did a sloppy acquisition, period. If you don’t get a waiver of liability that you should have, shame on you.
A reasonably civil Twitter fight broke out about it:
Sorkin’s argument is that, okay, but next time, big players might not be willing to step in in a pinch if they think they’ll get sued later for doing so:
Nonetheless, it is worth listening to Mr. Dimon. The next time a bailout is required, it might not be political pressure that keeps it from happening, but a company’s board not willing to accept it.
Plus he makes the unassailable point that these government suits are suspect in the first place because they punish current shareholders of JPMorgan, but don’t name a single individual, either criminally or civilly, as committing the fraud for which the corporate entity is being blamed. As Sorkin says: “Fraud isn’t something a company does; it is something people do.”
Call it a draw. But now that we’ve established all that, here’s a request from The Audit: Could we get a little hand, Dealbook, in helping actually identify the individuals who did the fraud, especially since we know the government isn’t going to do it?