Where does government end and the private sector begin? It reminds me of Ellen Ripley and the space marines stumbling upon the human/alien amorphous blob in “Aliens” (nerd alert!). It’s convoluted, to say the least. So what to make, or rather whom to blame, for Goldman Sachs’s recent success?

James Stewart’s piece in The Wall Street Journal makes a convincing case that we shouldn’t hate them for making money. Hate’s a strong word, and being a solid free-market guy, I would usually have no problem with their success. As Stewart rightly notes, they paid back their TARP funds; funds they were forced to take at usurious rates in a deal they couldn’t refuse.

No, the problem I have with Goldman is they seemed to have learned little — if anything — from the experience. Typical of Wall Street, fees and profit first, responsibility to clients second. Take CDOs. They pushed ‘em out to the market with gusto, but had no direct exposure themselves. They believed enough in them to sell them to consumers, but not enough to risk their own cash. As Ben Stein noted some time ago, the man that encouraged this behavior went on to become Treasury Secretary, and was tasked with cleaning up the very mess he himself had a big hand in creating. And that’s really the rub. Goldman survived the financial shakeout because they steered clear of CDOs and CDSs in the company portfolio, all the while marketing them to the public. Now they’re making record profits and collecting bonuses larger than they did at the height of the bubble. Goldman’s average salary then was $600,000 (factoring in janitors, receptionists and entry-level jobs). Now? $700,000. Anyone else have a problem with that?