THE BLOG
04/28/2010 05:12 am ET Updated May 25, 2011

Governor Corzine, You Are Wrong About Goldman's Unpopularity

"When you're successful it brings envy," ex-Govenor Corzine was quoted on Bloomberg this Wednesday. "People are broadly frustrated with the financial institutions and since it is the leader of the industry and has shown great success over a long period of time, I think its more vulnerable".

I would go one step further. There was a time when this might well have applied, coupled with enormous respect. That was the Goldman whose leadership was in the hands of the likes of Wall Street legendary titans as Sidney Weinberg and Gus Levy. That Goldman set the standard of accomplishment and civic consciousness and responsibility. That was the great Goldman Sachs.

Never would they have countenanced the duplicitous trading where, in some cases, Goldman has used derivatives to destabilize major institutions such as AIG. Or in the housing market by shorting derivatives that exacerbated the collapse of house values, by speculating against the debt of many states including New Jersey, California, Wisconsin, Florida etc., many whose municipal bonds were originally underwritten by Goldman (please see "Billions for AIG to Protect the Speculative Profits of Goldman Sachs/Morgan Stanley" 03.05.09). Then to helping Greece deflect perception of its steeply mounting budget imbalances by encouraging it to position itself into a massive program of credit default swaps and then actively and on a proprietary (for their own account) basis, speculating against those very instruments thereby making a bad situation much worse. And on to speculating in such as oil futures in a way that intensified the distortion and steep rise in oil prices bringing bountiful profits to Goldman and freezing homes in Maine.

As Mr. Blankfein was confronted in the hearings of the House Oversight and Government Reform Committee on January 27th with the observation about the overarching ethos of Goldman's proprietary trading activities , "Mr. Blankfein, isn't this like selling someone a defective car and then taking out insurance on the driver."

And of course the perception of access to Washington policy makers resulting in unfair and preferential treatment as in the AIG counterparty payouts made possible by the extraordinary generous and still not fully explained government's largesse. The old Goldman was certainly well connected, but one can well presume there were limits then to the degree that such access was put into play.

If, as Governor Corzine states, "...it is the leader of the industry...," then that speaks volumes of how Americans feel about our financial institutions. No, Governor Corzine, it's not about envy. It's about character.