Barney Franks finally going after Goldman Sachs & Friends, and we wish him well

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Barney Franks and his House Financial Services Committee will open hearings today to discuss ways to impose limits on executive pay and the risks our bankers can take. Good for him. Will we skip the obvious question—what took Barney so long?—and wish him well.

Clearly, the timing is no coincidence. Not after Frank’s home state drove home just how deep the populist anger in our nation truly runs. Note to Dems: Are you listening now?

Just to give Barney a rolling start, below are some choice words collected following the long-anticipated compensation announcement made yesterday by Goldman Sachs, the touchstone for all that is greedy and wrong in the financial system today. Goldman, clearly fearing a surge of citizens with torches and pitch forks storming their Manhattan fortress when the numbers went public—the New York Post reported police barricades and bomb sniffing dogs at Goldman’s 85 Broad Street headquarters—cut back their bonus pool as a percentage of revenues.

So, instead of a $20-billion pool, Goldman had just $16.2 billion to share with its employees. Tough times. Earlier, Goldman attempted to deflect criticism by taking $500 million out of its bonus pool and giving it to charity. Nonetheless, Goldman’s 32,500 employees, consultants and temporary staff will receive compensation averaging about a half-million dollars. For the record: Goldman earned a record profit of $13.4 billion on revenues of $45.2. Yes, that was a company record.

Not bad for a company that received more than a $10 billion bailout from the Obama administration. And you thought your tax dollars were going to waste.

“The bonuses just add insult to injury,” Representative Dennis J. Kucinich (D-OH), who has proposed a 75% bonus tax on Wall Street banks. “If they want to regain public confidence, they should reduce or eliminate their bonus pool. You are going to see a backlash developing against Wall Street.” Via the New York Times

Lynn A. Stout, a professor of securities law at the U.C.L.A., says the bank was “parasitical,” since it earned most of its profits from trading, not lending: “Goldman Sachs needs to become a socially productive member of society,” she tells the New York Times. “At the moment, they don’t have that claim.”

Here’s what Britian’s General Secretary of Trades Union Congress Brendan Barber, who represents 58 affiliated unions with nearly seven million workers, had to say in today’s Mirror:

“Goldman wants us to think it is modest. But the truth is we have set up an international welfare state for super-rich bankers. It’s time these scroungers paid back a transaction tax that can undo the damage caused by the slump.”

Goldman finance chief David Viniar had the unenviable task of trying to explain why his company should be handing out such large checks. Viniar said the compensation levels reflect an attempt to be “fair” also show “restraint.” Viniar said part of this reduction was a reactionto the 50% bonus tax the United Kingdom slapped on big bank compensation. He didn’t say if Goldman employees across the pound would take a larger hit on their compensation.

“I think the people of Goldman Sachs performed extremely well but….we are not blind to the pain and suffering going on in the world,” Viniar said. “And we are not deaf to calls for restraint.”

Goldman’s “restraint” line is going over almost as well as Mark McGwire’s apology for steroids. Here’s Vincent Reinhart, resident scholar at the American Enterprise Institute and a former economist for the Federal Reserve, with the majority view from today’s Boston Globe.

“There’s lot of anger about the financial system, a real sense the playing field is decidedly uneven. The issue is how do you channel this anger?’’

Channeling that anger is what Frank will be trying to do today. And not everyone is optimistic.

“After the crisis is over, after people pay back their TARP funds, they will go back to the old model,’’ Detlev Suderow, a lecturer in business at Brandeis University, told the Boston Globe. “Does Barney Frank really see any fundamental changes on Wall Street? I don’t see it.

I don’t think he sees it.’’

Good luck, Barney.