On Sept. 30, Bank of America CEO Ken Lewis announced that he will resign at year’s end. During the last eight years, Lewis has made huge profits, personally and for the bank’s major stockholders, through speculative and exploitative banking practices. More recently, he has raised interest rates and penalties on credit cards and continually attacked its workforce—in the midst of the worst economic crisis since the Great Depression.
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Last year, Lewis’s earnings totaled over $9 million. Although BofA formally ended golden parachutes seven years ago, the Los Angeles Times reported that Lewis will leave with $68.8 million.
Lewis has made no real contribution to society. He has accrued vast wealth profiting off the circulation of money as capital—not by selling commodities and certainly not by producing anything useful. All of this wealth is produced by working people, not bankers.
In late 2008, Lewis led BofA’s acquisition of Merrill Lynch, a global financial services firm that at the time was on the brink of collapse. The U.S. government rewarded BofA for their purchase of Merrill Lynch by guaranteeing an additional $20 billion from the Troubled Assets Relief Program.
Just prior to the merger, BofA approved over $5 billion in executive bonuses. The bank ended up paying a fine because it did not disclose the bonuses for fear of public outrage.
BofA received over $45 billion in government handouts between October 2008 and January 2009. The government claimed that the massive taxpayer-funded bailout was designed to “help all Americans.”
Lewis’ actions after receiving the bailout money tell the real story. Instead of putting a moratorium on foreclosures and layoffs, BofA increased interest rates and instituted higher penalties for late fees. Then, in December of 2008, Lewis announced that BofA planned to lay off 35,000 workers, about 11 percent of its workforce, over the next three years.
This is the reality of capitalism. While workers face foreclosures, evictions, inflation, skyrocketing unemployment and dwindling social programs, capitalist criminals like Ken Lewis profit from government bailouts and exploiting the working class.
