In late 2007 and the early days of 2008 Citigroup announced they were cutting 4200 jobs. This happened shortly after Vikram Pandit, while just six weeks on the job as Citigroup's CEO, was awarded a $26.7 million stock bonus and $3 million in stock options. It also happened as the bank was set to announce that, by the end of 2007, it was already holding $18 billion in mortgage backed toxic assets. It also happened at the time the share price had already been halved while being led into the abyss by its management team that had included its previous CEO Charles Prince, who was given a golden parachute of $10.7million in stock and a $13.2 milion cash payout. Not to be overlooked, the cheer leading along the slippery slide to disaster of Robert Rubin encouraging Citigroup to adopt a mindset to become an aggressive proprietary trader/speculator, with all of its disastrous downsides and with billions more yet to be lost. Rubin was of course the former Secretary of the Treasury and before that Chairman of Goldman Sachs and collected more than $100 million from Citigroup for his wizened guidance.
As I wrote in January 2008, "While these 'executives' were wallowing in 'gravy' Citigroup had the effrontery to announce almost simultaneously that it was cutting 4200 jobs! 4200 families in distress. Shameless is hardly too strong an adjective... Citigroup had become the poster child of so much that is wrong, and much of what is happening throughout corporate America."
Of course things deteriorated dramatically since then. By early 2009 the job cuts at Citigroup climbed beyond 75,000; and what happened at Citigroup was only the beginning of the one-sided unfairness that has become the shameful norm in the way we now do business.
Now it is no longer Citigroup and the then 4200 layoffs, but millions throughout the land that have lost and are losing their jobs and their futures; families and communities overwhelmed with foreclosures and far too many losing hope along with their homes. This while the likes of Goldman, Morgan Stanley and their brethren on Wall Street are dancing off richer than ever before, (consider just a short time back the likes of Lee Raymond, retiring CEO from Exxon with a $400 million golden parachute culminating a career whose grim achievement was to preside over the largest cog in an industry whose rapacious profits resulted from Americans paying over $4.00/gallon for their gasoline and many unable to meet the cost of heating their homes)
As mentioned then, and more assuredly applicable now, that American capitalism was becoming and has now become rotten at the core. Gone is the American capitalist impulse's unique sense of fair play and adherence to a level playing field accessible to all. That formidable confidence in our system as being a 'meritocracy', uniquely American in its nature, very nearly void of envy and resentment. The kind that made a Bill Gates not only possible but probable. Here was a land that nurtured, admired and celebrated his exemplary vision making him rich and all of us as a society, richer. A land that is now being overwhelmed and whose creative vision and sense of fair play is being destroyed by vested interests that have successfully stacked the game to such one-sided advantage that it now has lost all credibility and crushed our confidence in the meritocracy that was so deep seated in the American grain and served as a beacon unto others.
In January 2008 this post observed "The Citigroup bell has tolled". Today struggling with some $350 billion in government bail-out loans and guarantees covering hundreds of billions of toxic assets, indeed the "bell has tolled" for Citigroup.
And now, sadly, the bell is tolling for the spirit and brilliance of what once was American capitalism and its sense of fairness and free enterprise. What has come to pass is obscene and a healthy society cannot allow it to continue.