As one of the most powerful men on Wall Street, surely Lloyd Blankfein can’t be brought down by a single op-ed from a mid-level employee, right?

Not so fast. As Goldman Sachs (GS) leaps into damage-control mode over the salacious diatribe written by a former vice president at the firm, some are wondering whether the incident could be the final nail in the controversial CEO’s coffin.

“If I was placing bets on it, I would bet that Blankfein is likely to be the D’Antoni of this spring,” said Saul Cohen, a retired Wall Street lawyer, alluding to the ouster of New York Knicks head coach Mike D’Antoni earlier this week.

As the thinking goes, Goldman, the preeminent Wall Street investment bank, has now suffered one too many public-relations black eyes.

Add Muppetgate to the List

Since the financial crisis erupted in 2008, Goldman has been the subject of countless investigations, including a Securities and Exchange Commission probe that resulted in the company paying a record $550 million.

That settlement followed the “Fabulous Fab” emails that revealed a high-level Goldman broker knew he was selling his clients mortgage-related securities that were garbage.

Blankfein hurt his own case when he defended compensation practices by telling the Times of London in 2009 he’s just a banker “doing God’s work.” Rolling Stone helped crystallize the anti-Goldman sentiment in a 2010 essay that called the bank a “great vampire squid” that jams “its blood funnel into anything that smells like money.”

The latest salvo was fired by Greg Smith, who started Muppetgate by unleashing a takedown of Goldman in an op-ed that appeared in The New York Times this week and garnered widespread attention.

Calling out the firm’s leadership, Smith said Goldman is “toxic and destructive” and said he can “no longer in good conscience…identify with what it stands for.” Smith said he saw at least five instances of managing directors referring to clients as “Muppets.”

“Out of context, it looks terrible, but in context it looks like the same kind of thing you’d hear at every major trading firm,” said Charles D. Ellis, author of The Partnership: The Making of Goldman Sachs.

While Goldman has noted Smith had a mid-level position and others chalk the outburst up to “sour grapes,” it’s extremely rare in the history of Goldman to have a former employee criticize the company in such a public manner.

“I think it adds to Goldman’s tarnished reputation,” said Charles Geisst, a finance professor at Manhattan College.

Not a Popularity Contest

However, Geisst and others believe the story won’t do long-term damage to Goldman’s efforts to recruit and retain clients because it broke little new ground, and Smith admitted he has no evidence of impropriety.

“I accept the fact that most customers do not really like the firm. I accept all that and believe it’s true,” said Dick Bove, a veteran banking analyst at Rochdale Securities. “The question is then: What in hell does this firm have that gets customers to keep dealing with it?”

Bove pointed to two areas of “tremendous competitive advantage” that Goldman enjoys: superior trading technology that gives it the ability to offer clients better prices on a wide spectrum of assets than rivals, and intellectual capital that makes its investment-banking arm unmatched.

These advantages help explain why after years of bad press and a tarnished reputation, Goldman is still recognized as Wall Street’s No. 1 investment bank. According to Dealogic, the firm generated more investment-banking fees than any other last year.

“There have been other complaints about Goldman Sachs going back decades. But the clients don’t go away. The clients keep coming,” said Bove.

Goldman officials weren't available for comment. 

Cohen, who served as general counsel at Lehman Brothers in the early 1980s, notes that the individuals and businesses that seek financial advice from Goldman don’t tend to be naïve investors.

Smith “is not talking about widows and orphans. He’s talking about institutional customers. A lot of them are at least as smart and have as much talent and have as good computers as the Goldman people do,” said Cohen.

Blankfein's Future

Bove adds, “Until the clients decide that all of this garbage in the press means something, there’s not going to be an impact on the bottom line.”

Blankfein, 57, became CEO in 2006 after Henry Paulson stepped down to lead the Treasury Department in the Bush administration. Given the tumultuous years during his tenure, the native New Yorker is no stranger to hearing calls for his termination. 

While some directors may be tempted to give Blankfein the boot over the latest PR fiasco, doing so may only validate Smith’s criticisms, at least in the public’s eye.

“You just can’t give this guy and his argument credibility by firing Lloyd Blankfein. You’ve got to do the opposite,” said Bove. “I think [Smith] solidified Lloyd Blankfein in his position for another couple of years.”

Ellis seconded that opinion. “As a member of the board of directors I wouldn’t dream of touching it. I would be doing real harm to my firm,” he said.

Can Reputation Be Fixed?

None of this means that Goldman should just accept the reputational harm it has suffered over the past four years. While its competitive advantages and public perception may save Blankfein and prevent the firm from losing clients, it could still be hurt down the line.

“Do I think Goldman Sachs needs to change? Yes. Do they think so? Yes,” said Ellis, pointing to a series of recommended changes to Goldman’s business practices that were released last year.

The very decision by the Times to publish the Smith op-ed underscores the dreadful public perceptions of the firm (and perhaps the Times' agenda).

“I suspect it probably never would have been picked up if it had been any of the other major firms,” said Ellis.

Sources told FOX Business’s Charlie Gasparino that Goldman execs can’t understand how the Times could do this to Goldman because the two companies had an investment-banking relationship.

“I think that’s just a testament to Goldman’s current public relations more than anything else,” said Geisst. “If you see tomorrow in the news Goldman Sachs is taking over The New York Times via some South Korean paper, then we’ll know they were really (angry).”

Follow Matt Egan on Twitter @MattMEgan5