By Stephen Gandel
January 21, 2014

FORTUNE — Goldman Sachs’ announcement last week that its fourth-quarter earnings fell 19% from a year ago was greeted as a watershed moment.

New York magazine suggested Goldman (GS) bankers switch from Dom to André. The New York Times called Goldman wary, with a key unit in continued decline and facing uncertain regulations. Politico took the occasion to declare that Washington had beaten Wall Street.

So is Goldman really less of a money-minter than it used to be? Bloomberg reported that, for the fourth straight year, Goldman’s profitability was lower than before the financial crisis and Dodd-Frank, citing return on equity (ROE). It’s now around 10%. It used to be regularly above 20%. But Matt Levine, who is also at Bloomberg, said the focus on ROE is silly. ROE is a function of leverage as well as profits. And Goldman is half as leveraged as it used to be, which is a function of more strict international capital rules, but it also means Goldman is less risky. That’s why its ROE is down, not because it is any less profitable. Basel beat Wall Street.

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One way to solve the debate is to look at return on assets, which is how much money Goldman was able to make on its assets. ROA takes leverage out of the equation since, unlike ROE, it excludes debt. ROA is down at Goldman post-Dodd Frank, which was passed in 2010, but not by that much. Goldman has averaged return on assets of 0.8% for the past four years. Pre-2010, Goldman’s ROA was more like 1%. That suggests Goldman is 20% less profitable than it used to be. Congrats Washington.

And in Goldman’s trading business, the one that everyone says is in decline, profitability appears to be up. In 2007, Goldman had a return on its trading assets of 1.7%. Last year, it was around 1.9%.

Goldman is certainly acting like it’s less profitable. It’s making itself a nicer place to work, by adding meditation and tai chi and launching a task force on how to make junior bankers happier. That’s exactly what you do when you know in the future the draw of your company won’t be how much money it makes or how much it pays its employees. Indeed, Goldman cut its average pay in 2013, though it still tops $380,000.

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And all this comes at a time when the economy continues to be weak. Goldman got a boost in the past year from underwriting IPOs and advising on mergers. Those businesses require very little assets. As the economy improves, Goldman is likely to get more and more of that work, boosting its profits and profitability. You know who really beat Goldman? The recession.

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