JP Morgan Chase CEO explodes over socialist policies

Jamie Dimon, CEO at JP Morgan Chase, exploded during a recent earnings call over Congress’ failure to jump start the US economy. He said,

It’s almost an embarrassment being an American citizen traveling around the world and listening to the stupid s--- we have to deal with in this country… And at one point we all have to get our act together or we won’t do what we’re supposed to for the average Americans.

Since the Great Recession, which is now 8 years old, we’ve been growing at 1.5 to 2 percent in spite of stupidity and political gridlock, because the American business sector is powerful and strong… What I’m saying is it would be much stronger growth had we made intelligent decisions and were there not gridlock. 

He added that the United States has become “one of the most bureaucratic, confusing, litigious societies on the planet,” and that “it’s hurting the average American that we don’t have these right policies.”

Now keep in mind that Dimon is a member of the Democrat party. The policies that party has promoted since the election of Woodrow Wilson have consistently pushed for greater socialism beginning with the income tax and progressive taxation, continuing through FDR’s New Deal and Johnson’s Great Society, a pause during Clinton’s fling with interns, and resuming in Obama’s healthcare. Paying for increasing socialism requires higher taxes. Reagan, Bush I and Clinton each passed tax increases each of which were the largest in US history at the time and the US now has the highest corporate tax in the developed world. Does Dimon’s left brain know what his right brain is saying?

I’m not insisting that Dimon should convert to the Republican party, the party of socialism-light. The scope and size of government exploded under Reagan and both Bushes. Bush II gave us an expanded Department of Education and explosive growth in Medicare spending on prescription drugs. It should have been no surprise to most that Republicans find nothing wrong with Obamacare. Their jawboning for 8 years about repealing it was all just typical political posturing (lying) and nothing more.

But someone in Dimon’s position should understand politics better than he does. At his age he still thinks politicians work for the common good. He needs to drink a tall cold glass of reality, starting with reading some of the volumes from the Nobel Prize winning political economist James Buchanan. Buchanan resurrected a realistic view of politics in what has become known as public choice theory. That’s an odd name for a simple concept, but economists tend to be language challenged.

Boiled down, public choice states that politicians don’t become angels when they get elected. They’re still the same old arrogant, selfish, greedy, ignorant people they were while campaigning. Instead of working for the common good they work to advance their careers. They do that mostly by selling their power to the highest corporate bidders. As the great commentator P.J. O’Rourke wrote, when Congress controls the market, the first thing sold is Congressmen. Congressmen are being perfectly rational: they are doing what their campaign donors want them to do.

If he were politically astute, Dimon would thank God for a gridlocked Congress because every law they pass does more harm than good. Dysfunctional Congresses are a feature of politics, not a bug. He mentioned several countries that he thinks are doing a better job than the US at managing their economies:

I was just in France, Argentina, Israel and Ireland. We met with the Prime Minister of India and China. It’s amazing to me that every single one of those countries understands that practical policies to promote business and growth is good… for the average citizens of those countries, for jobs and wages.

Seriously?! France’s economy is a disaster almost on the scale of Greece. Argentina just defaulted on its huge debt for the tenth time. Massive corruption and socialism in India will block that nation from ever being a major economy. China is blowing the largest real estate bubble in history while the Communist Party reasserts its control over the economy, both of which threaten to destroy the Chinese miracle that slightly freer markets created. I’ll give him Israel and Ireland as decent examples.

Politicians the world over are the same. They will tell you what they think you want to hear. I have no doubt that if Dimon visited with some of the Congressmen he despises he would hear exactly the same sentiments as he received from those in France, Argentina, Israel, Ireland, India and China.

As Reagan used to say, government is the problem, not the solution. We can never expect politicians like the Democrats and Republicans who pollute Washington today to ever solve any problems. Congress creates problems; it never solves any. The beginning of a solution to the US’s economic problems has to start with taking power from Washington and giving it back to private citizens. A good start would be to limit Congress to meeting only every five years, and then for only a few months. But there will be no change as long as voters think like Dimon.