Obama And The Minimum Wage

Was He Inspired By Jamie Dimon’s Raise?

Was President Obama’s demand that congress raise the minimum wage from $7.25 to $10.10 inspired by Jamie Dimon’s raise? Jamie got a 74% raise to $20 million for 2014 from his 2013 salary of only $11. Obama is asking for a 40% raise from $7.50 to $10.10 for the minimum wage frozen since 2009.

In some circles, Jamie is a hero. Federal agencies were making life hard for JPMorgan Chase. They were trying to enforce financial service industry regulations. (Imagine that!) Several lawsuits were headed to court because of JPM’s alleged shenanigans like phony valuations of mortgage-backed securities (those tainted securities helped start The Great Recession), illegal stock trading (see The London Whale) and looking the other way (called “willful ignorance” by courts) when Bernie Madoff pulled off the biggest Ponzi scheme in history. There were also 8 other JPM activities of “regulatory interest.”

Jamie came through. He steered the JPMorgan Chase behemoth down the settlement deal road for everything: JPMorgan Chase paid about $20bn in fines without having to admit guilt of doing anything illegal. Jamie got JPM through these messes without harming JPM stock (up 20%) or anyone important going to jail.

It is an inspiring story to true believers in the financial services industry. Many are reported to have made dollar signs with a finger, placed their hands over their hearts, and said “Praise to be to Jamie and JPM.” Maybe that’s what inspired the president to ask for a raise in the minimum wage.

 Consumerist Takeaway: The president might now enlarge the idea of “raises” to interest rates on ordinary savings accounts. Given JPMorgan’s mammoth profits in spite of billions in fines and salary increases, why doesn’t JPM raise interest rates on savings accounts? Savings interest is frozen nationwide at about half of 1%. That money is used for loans at interest rates easily 12 times greater than savings interest.


Tags: , , , , ,

Comments are closed.