Chrystia Freeland, who has been hanging around billionaires and relaying some of their most embarrassing commentary for a while, does this again for the New Yorker, and basically we hear the same thing we always hear; the fee-fees of the rich and powerful were vewwy vewwy hurt by that mean old Mr. Barack, who called them names that they probably heard about when they were cashing the massive checks guaranteed to them by government largesse. Leon Cooperman is probably the most victimized billionaire among this clan. Here’s just a taste.
In the letter, Cooperman argued that Obama has needlessly antagonized the rich by making comments that are hostile to economic success. The prose, rife with compound metaphors and righteous indignation, is a good reflection of Cooperman’s table talk. “The divisive, polarizing tone of your rhetoric is cleaving a widening gulf, at this point as much visceral as philosophical, between the downtrodden and those best positioned to help them,” Cooperman wrote. “It is a gulf that is at once counterproductive and freighted with dangerous historical precedents.”
Now before we tee up why these are the last people in the world who should be angry with the President, given his steadfast support of their oversized bank accounts, let’s be clear of one thing: these billionaires aren’t angry. They may have had their feelings hurt at one time, but they’re perfectly rational creatures. They want to keep more of their money. And if they antagonize the political class by treating every rhetorical slight as a personal affront, they can summarily stop the rhetorical slights, or more important, get them made up for with cold, hard cash. They’re just working the refs, that’s the entire strategy.
There’s nothing too “mystifying” about it. Rich people have mechanisms to get politicians to do what they want. The main lever is money, and everything springs from that. A hedge fund manager with “hurt feelings” is a hedge fund manager who won’t fund your campaign, or who will fund your opponent. Now, it’s worth noting that this has had no impact at the Presidential level in terms of the horse race. But it unquestionably has had an impact in terms of policy. That’s why Bill Daley was President Obama’s second chief of staff, it informs the “protect the banks” strategy at Treasury, and so on.
Felix Salmon has some other good thoughts about the switch from Fear mode to Greed mode, the shift from “bail me out” to “stay away from my money.” And that’s part of this. But one of the tools rich people in finance use to get politicians to “stay away from their money” is to cry crocodile tears at the slightest insult, to warn the politicians of the fury that will be unleashed unless they play ball.
Which is why I think the greatest development in the world right now concerns the drop in college graduates moving into finance. I’m not sure I buy regulatory change as the reason for this rather than the casual scorn that the public feels for anything coming out of Wall Street. And this is where the crocodile tears actually hurts these Wall Street guys. They have attracted attention to the comments about them being the worst people in the world, which of course they are. And a 22 year-old decides he doesn’t necessarily want to sign up for a life of that, no matter what the perks. And they start to look elsewhere. (They may just be moving from investment banks to private equity or hedge funds because of regulatory issues, which would fix matters. So hopefully that trend will peter out.)
Nothing will rebalance the relationship between finance and the rest of the economy than starving Wall Street of new talent. Let’s hope that trend continues.