I mean this in a couple of ways. If people in Detroit were all named “Jamie Dimon,” a bailout would be on its way, free and clear, low-interest, no questions asked, the same kind of bailout JP Morgan Chase’s Dimon and his gang of thieves on Wall Street were able to pocket after they cratered the economy. But, barring Dimon being an actual whore, not simply a financial one, the familial connection ain’t happening for the people of Detroit — not that they’d really want it. That said, there is a real argument to made: Wall Street should pay for Detroit’s fiscal situation. And I’d propose a surtax on profits called “The Jamie Dimon Surtax.”

I’ll try to make this as painless as possible but we need to do a bit of math here.  I’ll come to the Jamie Dimon Surtax in a moment. But, let’s hammer home a few things.

Listen up, especially all the liberals wringing their hands who secretly, in their heads, have bought this idea, spread irresponsibly by the transcribers of press releases (formerly known as “journalists”) that the people of Detroit have brought this crisis on themselves because of some huge-ass pensions being paid:

Detroit’s financial crisis is entirely about the bankruptcy of the so-called “free market”, as I wrote a few days ago.

AND:

There is no pension crisis. It’s a fiction.

I’m not going to go over all the arguments I made in the first post on Detroit but, basically, an entirely corrupt economic system savaged Detroit, and is doing the same to other cities: from tax cuts for business that spur nothing but CEO salaries, to a refusal to enact a single-payer health care system, because handing profits to drug and insurance companies was deemed more important, leaving cities to bear the brunt of the cost of billions of dollars in morally-granted health care coverage for retired workers.

Here, I want to stick only with pensions — with more on Detroit in future posts.

The pension rubbish you read is simply part of a plan to weaken public defined-benefit pensions. Ideologically, conservatives and lots of liberals have tried, for really 30 years, to eliminate defined benefit pensions in favor of IRA-type pensions…yeah, how’s your IRA looking today?

The Wall Street Journal reports, that, “The bankruptcy filing lists $18 billion in long-term liabilities for the cash-poor city, including $5.7 billion owed for retiree health care and $3.5 billion to pensions for city workers.” [emphasis added]

Well, so, what? True, you and I don’t have that as loose change in our pockets — but that’s not the way pensions are figured. You calculate them over many years because that’s how payments are made.

You may have read about the Detroit-fueled big scare floating through the airwaves in the past few days about pensions: oh my god, we have a total of $3.8 trillion in pension liabilities in states and cities. Now, that’s a big number…and it really isn’t much of a big deal.

Here’s Dean Baker of the Center for Economic and Policy Research, eviscerating an editorial in The Washington Post:

You see, the $3.8 trillion figure was an estimate of total liabilities, not unfunded liabilities. Since the pensions have $2.8 trillion in assets, their unfunded liabilities are just $1 trillion. Or, to put this in terms that may be understandable to Post readers, the unfunded liabilities are 0.22 percent of projected GDP over the next 30 years. And, as I noted in my earlier post, most state and local governments are already funding at levels that are consistent with making up this shortfall so there will no required tax increases or spending cuts to meet these future obligations.

What that means is: there is no crisis. It’s manufactured. If per capita income grows at the same pace over the next three decades than the Detroit shortfall would be about 0.35 percent of income over the next 30 years. Modest challenge, not a crisis.

That said, Jamie Dimon and his gang cost pension funds around the country billions of dollars. Here is how we get that number.

I never thought I’d stoop so low to quote the paragon of centrism, the Brookings Institution. But, hey, when someone is right…Brookings calculated in “The Financial Crisis’ Effects on the Alternatives for Public Pensions”:

It appears that the public plans in the aggregate suffered investment losses of about 25% of total assets from September 2007 through March 2009. [emphasis added]

The City of Detroit General Retirement System (the system for certain public workers) has $2.2 billion in assets now. Let’s say, based on market changes since the financial crisis, it was about $2 billion in 2007 (I may be off a bit). The Police & Fire Fund has $3.1 billion now; let’s say it was roughly $2.9 billion in that 2007 period.

That means that, between the two funds, it’s likely the financial crisis cost over a billion dollars: $500 million at the General Retirement System and $725 million at Police & Fire Fund.

Meanwhile, not a single top banker or Wall Street banker has gone to jail. Not a single one has paid personally out of their own pockets the hundreds of millions of dollars in fines imposed by a variety of regulators (fines that, by the way, I have long argued are not enough — short of serious jail time for the CEOs, fines don’t cut it).

So, my proposal is this: every bank and financial institutions should be hit with a one-time surtax of 15 percent to claw back losses to pension funds because of the greed and stupidity on Wall Street; just as another example, as I wrote, six New York State and city pension funds alone lost more than $750 million because of Citibank’s behavior alone. And I’d add in 15 percent of all the fine money paid by these thieves to the government to be handed stay-out-of-jail cards.

Call it economic reparations to every community in the nation.

Because, while times have been rough for the regular people in Detroit, it’s been sweet for banks:

The latest data from the FDIC show banks taking in net income of $34.5 billion in the second quarter of 2012, that’s up $5.9 billion from from the second quarter of 2011.

More notably, banks have been reporting net income in the $25 to $35 billion range consistently every quarter since 2011–levels not seen since 2007. In the third quarter last year net income passed the $35 billion mark reaching $35.2 billion. The last time banks reported levels like that was in the second quarter of 2007.

So, say if bank profits were $100 billion in 2012, 15 percent of that is $15 billion. Just for starters — because that doesn’t include the Goldman Sachs’ of the worlds.

Put in a fund and parcel it out to the people who should benefit from it — the retirees who put deferred wages into pension funds.

In honor of his roll in the financial crisis, let’s call it The Jamie Dimon Surtax.