WASHINGTON (TheStreet) -- Goldman Sachs (GS) has launched a charm offensive, this time offering wads of cash to others, an abrupt about-face from its reputation of greed and comments just days earlier that led to a public backlash.
The firm plans to lend $250 million, and spend another $250 million on educational programs and grants, meant to help 10,000 small businesses across the country. CEO Lloyd Blankfein also apologized for the firm's role in the credit crisis and said he regretted an earlier remark that Goldman is doing "God's work."
Whether the apologies and pseudo-charity work are effective is yet to be seen, mainly because the genuineness of Goldman's newfound kindness is questionable. The firm already had made its intentions clear -- earn money, pay bonuses, keep doing "God's work" -- and only found the need to apologize when the backlash reached a fever pitch.
While the small-business program appears to have good intentions, it comes after disclosure that Goldman's charitable arm wasn't so charitable after all. The Goldman Sachs Foundation gave away relatively paltry sums of money over the past few years -- essentially the bare minimum of 5% to maintain its charity status -- and the firm wasn't helping replenish its coffers. The foundation started with just more than $500 million in 1999, and had a balance of $404 million at the end of 2008.By contrast, Goldman is preparing to pay $23 billion in bonuses this year. The foundation's balance, combined with the new small business program, represents just 3.9% of that sum.
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