Just a few weeks before federal prosecutors announced a nearly $2 billion settlement with JPMorgan Chase over Bernie Madoff’s fraudulent accounts, chairman and chief executive officer Jamie Dimon sat alongside former Congressman and White House Chief of Staff Rahm Emanuel at an Aspen Institute forum in the biology lab of Malcolm X College to tout the embattled bank’s five-year, $250 million, multi-city investment in job training. The bank would commit $15 million for “workplace readiness and demand-driven training” in Chicago.
JPMorgan is not alone in its quest to change how it is seen. Goldman Sachs recently extended its 10,000 Small Businesses plan to Detroit, the latest of a number of cities to receive cash from the investment bank. There’s a reason beyond the corporate charity push for all the giving. The financial industry is facing a sea change in electoral politics. It is increasingly operating in a polarized political system that has placed a premium on accountability. Populist and ideologically extreme constituencies are needed for primaries and general elections in which fewer middle-of-the-road voters participate. Loyalties change quickly if pols don’t sway the way their bases want. Elected and would-be elected officials can rely on campaign cash from super PACs and independent expenditures involving wealthy contributors like Sheldon Adelson, George Soros and David Koch. Campaigners don’t have to rely as much on Wall Street as a unit.
Politicians, especially Democrats, benefit from denouncing financiers. As Ben White and Maggie Haberman reported in Politico, “at both ends of the political spectrum, the titans of American finance today find themselves alienated from politics to a surprising degree.” White and Haberman document an environment in which President Obama labels them “fat cats,” the left demonizes and the Tea Party Republicans just shun. So when someone like White House Senior Adviser Valerie Jarrett mentioned Goldman Sachs’ 10,000 Small Businesses in an interview with White, it shows the benefits an outfit like JPMorgan get from courting charitable initiatives, even if they delve into murky policy terrain.
It’s no accident that Dimon appeared with Emanuel, who is perceived as a hands-on, connected public servant. More than just a good will gloss, the bank’s job training effort is a move to make nice with a political and regulatory establishment that denounces plutocrats. So what better way for JPMorgan Chase to ingratiate itself with the public servant class than to play policymaker in Chicago by throwing tax-deductible money to a job-skills training effort run by a proven pragmatist with deep Washington ties?
JPMorgan Chase won’t say much about how the “New Skills at Work” initiative was conceived or what it will entail. A continuation of the bank’s corporate responsibility arm that funds non-profits and others, the push is clearly an effort to change the bank’s deteriorating public image following the $13 billion Department of Justice settlement, the Madoff case that included a blocked probe, an “Ask JPMorgan” social media campaign that yielded questions such as whether it is “ok to outright lie cheat and steal” and a host of other embarrassments.