“American attitudes toward Wall Street are ambivalent. Most people believe that Wall Street benefits the country and that what it does is ‘absolutely essential,’” according to a Harris Interactive statement.
The survey was conducted during the first two weeks of February and published in mid-March.
Americans’ frustration is not so much with Wall Street the entity or the concept, but more so with the people who work in the financial industry. The words used to describe these people range from “loan sharks” to “greedy” to “insatiable.”
Attitudes have deteriorated much since a 2008 Harris survey—and people have become more vocal about their negative opinions.
The general agreement is that Wall Street is essential in the economic environment that has developed globally. More than half of those polled said that Wall Street is essential to the economy and society at large. But there still is an overall agreement that Wall Street has overstepped its boundaries, pushed too far, and needs to be reined in.
The impression among the populace is that those working on Wall Street have no qualms about circumventing laws, as they have the smarts and training to do so and will definitely use it to make money.
The general belief is that “most people on Wall Street would be willing to break the law if they believed they could make a lot of money and get away with it,” according to responses in the Harris Poll.
Many Americans feel that those working on Wall Street can’t justify their earnings and are not worthy of what they earn.
Hostile feelings seemed to magnify on the topic of year-end bonuses. Populist backlash reached a zenith after bonuses were announced the past two years at American International Group, the struggling insurance company that was bailed out by U.S. taxpayers.
“There is no evidence that the American people have begun to forgive the people in Wall Street or to forget the huge problems that they caused. More than four out of five adults want them to be regulated more toughly,” a Harris press release said.
Consensus Among Pollsters
A recent Bloomberg national poll reported similar findings.
Public sentiment calls for disciplining Wall Street players, especially those from lending institutions and insurance companies. The call for consumer protection is echoing throughout America, especially to federal regulators.
More than 65 percent of people polled by Bloomberg despise corporate executives and see them as money grabbing dishonest individuals.
The public demands that fat paychecks, bonuses, and other compensation packages be curtailed and become more realistic.
The Bloomberg poll singled out banking giant Bank of America Corp. and investment bank Goldman Sachs Group Inc.
Many believe that government officials and banking firms are cohorts due to effective lobbying efforts by those companies, and the promise of a possible job in the future upon retirement, according to an unnamed analyst, privy to government and industry relationships.
“No matter the outcry by the public, everything will be swept under the table as soon as the economy has improved. No regulation that would lighten the pockets of those in those industries will ever come out of Washington,” said the analyst.
Criticizing Regulatory Efforts
“Congress continues to promise tough regulation of the financial industry,” said Sy Hardin, CEO of investment advisory firm Asset Management Research Corp. in a recent article on EzineArticles.com. “More months will pass, during which investors and consumers will hear assurances that tough reforms will take place. But nothing meaningful will be forthcoming.”
Lobbying efforts have reached a high pitch from insurance companies, banks, and other Wall Street firms. They spend millions of dollars annually. Most funds are earmarked for the “House and Senate banking committees and House and Senate leaders,” Hardin said.
JPMorgan Chase & Co. contributed an article titled “Doomsday Regulation Scenario Laid Out” to the Financial Times in February. The article warns that pricing of banking products will increase by roughly one-third due to recent banking regulations introduced by the Obama Administration. The articles name European banks, including Credit Suisse Group and Deutsche Bank AG, as also significantly affected by any regulatory efforts.
U.S. Sen. Chris Dodd’s latest proposal calls for the Federal Reserve to gain oversight of the largest financial firms, but Hardin isn’t sold on the legislation.
“When they [financial industry] have convinced the public of that [no regulations are needed], and the furor for reform dies down, Congress will also back down, leaving it pretty much business as usual for Wall Street,” predicts Hardin.
