Bailing out Wall Street billionaires is not exactly popular with voters, so Hank Paulson, George W.’s treasury secretary, came up with this cover story: It’s not about Wall Street, it’s about your street.
He explained that putting 250 billion of our tax dollars into the nation’s largest private banks will unclog their credit flow-like Liquid-Plumr for banks. With this government input, Paulson promised, banks would again make loans to businesses and consumers, and bluebirds of economic happiness would once again twitter throughout America.
He lied. There was never any connection between the bailout and credit flow. Indeed, the bailout czar is now doling out billions with absolutely no strings attached-no requirement whatsoever that the recipient banks start making loans to “your street.” The unclogging rationale was a scam.
Instead, Paulson & Company are using the bailout funds to restructure banking in ways that’ll harm your street. Behind the scenes, the Treasury Department is actively encouraging big banks to use their taxpayer windfall to buy out our regional and local banks, eliminating these smaller competitors from the marketplace. The big banks, of course, are delighted. For example, JPMorgan Chase got $25 billion from us, and a top executive recently gushed about being able to use it “on the acquisition side or opportunistic side for [taking over] some banks who are still struggling.”
By forcing this consolidation, Paulson will reduce banking choices and services for consumers, while driving up fees. He’ll also drastically enlarge the very giants that made the mess we’re in-banks that he told us are already “too big to fail.”
This bailout has gone from scam to scandal! Where is Congress? Paulson shouldn’t just be stopped-he should be impeached.
$700 BILLION BOONDOGGLE
With his usual keen insight, George W. recently offered this comment about the Wall Street collapse: “Anyone who makes bad decisions should fail.”One wonders if he ever looks in the mirror.
His own bad decisions aside, however, he’s now stuffing the pockets of Wall Street bankers with billions of our tax dollars to keep them from failing. Sending an even worse message, Bush is attaching no strings to this reward for incompetence and malfeasance.
We’re talking about at least $700 billion here, coming out of our public treasury. Imagine if that sum were invested in public projects?
We could repair all of America’s deteriorating bridges, roads, and levees-projects that would create a million or more good jobs.
We could launch a “Green Deal” to make all of America’s homes and buildings energy efficient-all of FDR’s New Deal public works projects, for example, cost only half as much as Bush’s Wall Street bailout.
We could replace the Hubble telescope, put a new international space station into orbit, and launch a new Apollo-style exploration of our planetary system-all for less than the bailout’s cost.
You might recall that we’ve always been told that there’s no money to do big American projects. Really? Then where did they find that $700 billion they’re now handing out to Wall Street?
MOTHER KNOWS BEST
Ordinary Americans can make a big difference, even against great odds, when they dare to stand up and challenge The Powers That Be.
Cheryl Harris dared to confront two of the biggest powers: the Pentagon and its favorite corporation, Halliburton. “I’m not going to sit around quietly,” she said determinedly early this year. What prompted her defiance was the death of one of her sons in Iraq. Ryan was killed not by the enemy but by the shower in his own barracks. He was electrocuted, apparently suffering a long and painful death.
Ms. Harris asked questions. She got lies. Army officials blamed Ryan, saying he’d gone into the shower with “a small appliance.” She knew her son better than that, so she kept pushing for real answers. With the help of a lawyer, she eventually discovered that the shower was connected to an improperly wired water pump.
KBR, a Halliburton subsidiary that has been paid $24 billion by the Pentagon to do such basic work in Iraq as electrical wiring, had known 11 months prior to Ryan’s electrocution that there were severe electrical problems in that building. KBR officials scoffed at Ms. Harris, saying that their contract with the Pentagon included no responsibility to prevent such deaths.
Now, though, the corporate scoffing has subsided substantially, for Cheryl Harris’s insistent activism reached Congress, which forced the Pentagon to investigate. It turns out that Ryan is not the only victim; 18 of our soldiers have died from electrocution in Iraq. The investigation reveals a pattern of shoddy electrical work, KBR has now been found guilty of “serious contractual noncompliance” for jobs it has done in Iraq, and the Army has recently reopened its investigation into Ryan’s death.
All because one mother would not stay quiet. She dared to question authority, then she questioned authority’s answers.
For more information on Jim Hightower’s work-and to subscribe to his award-winning monthly newsletter, the Hightower Lowdown-visit www.jimhightower.com. His latest book, with Susan DeMarco, is Swim Against the Current: Even a Dead Fish Can Go With the Flow.