JPMorgan Chase & Co. Chief Executive Jamie Dimon bashed socialism in annual letter to shareholders.
Dimon, whose company is the nation’s biggest bank by assets, strongly defended capitalism, warning that socialism would be “a disaster for our country.”
Dimon also defended stock buybacks and warned of some potentially dangerous days ahead, CNBC explained.
“Socialism inevitably produces stagnation, corruption and often worse – such as authoritarian government officials who often have an increasing ability to interfere with both the economy and individual lives – which they frequently do to maintain power. This would be as much a disaster for our country as it has been in the other places it’s been tried,” he wrote in his 51-page letter.
Dimon admitted there are flaws with capitalism and that it should be combined with a strong social safety net.
“I am not an advocate for unregulated, unvarnished, free-for-all capitalism. (Few people I know are.) But we shouldn’t forget that true freedom and free enterprise (capitalism) are, at some point, inexorably linked,” Dimon said.
Dimon’s comments come after he reportedly said last month he thinks that the U.S. economy has essentially been split into those benefiting from thriving corporations and those who are left behind.
“I don’t want to be a tone deaf CEO; while the company is doing fine, it is absolutely obvious that a big chunk of [people] have been left behind,” he was quoted as saying at an event at the bank’s New York headquarters to unveil a new $350 million program to boost job prospects for people in under-served communities.
“Forty percent of Americans make less than $15 an hour. Forty percent of Americans can’t afford a $400 bill, whether it’s medical or fixing their car. Fifteen percent of Americans make minimum wages, 70,000 die from opioids” annually, CNBC quoted Dimon as saying at the time.
Dimon also recently said that the ultra-rich could afford to pay more taxes as a wider political debate rages over increasing taxes for the wealthy, Reuters reported.
“I believe that individuals earning the most can afford to pay more, and I have no problem paying higher taxes to address some of the fundamental challenges and inequities in our society,” Dimon said in a statement emailed by JPMorgan, in response to questions posed by reporters.
“However, we need to ensure that our tax dollars are going where they can be most effective – like expanding the earned income tax credit and other programs that support the people and communities who really need it,” Dimon added.
Dimon’s remarks come as Democrats have pushed for tax hikes on corporations and the wealthy.
U.S. Representative Alexandria Ocasio-Cortez, part of a new crop of Democrats that swept into office this year on a stronger liberal platform, has advocated taxes as high as 70 percent on taxable earnings above $10 million. That represents a large increase over the current 37 percent, which kicks in at $500,000 for a single earner.
Meanwhile, Massachusetts Senator Elizabeth Warren, another Democrat and liberal firebrand who has taken on Wall Street, has proposed a tax on the accumulated wealth of the ultra-rich, through an annual payment of 2 percent of the value of net assets between $50 million and $1 billion and a 3 percent rate above that.
Dimon received $31 million in total pay for 2018, according to a regulatory filing by JPMorgan.
Material from AP, Bloomberg and Reuters were used in this report.