By Matt Taibbi, January 4, 2013, Rolling Stone
“It has been four long winters since the federal government, in the hulking, shaven-skulled, Alien Nation-esque form of then-Treasury Secretary Hank Paulson, committed $700 billion in taxpayer money to rescue Wall Street from its own chicanery and greed. To listen to the bankers and their allies in Washington tell it, you’d think the bailout was the best thing to hit the American economy since the invention of the assembly line. Not only did it prevent another Great Depression, we’ve been told, but the money has all been paid back, and the government even made a profit. No harm, no foul – right?
Wrong.
It was all a lie – one of the biggest and most elaborate falsehoods ever sold to the American people. We were told that the taxpayer was stepping in – only temporarily, mind you – to prop up the economy and save the world from financial catastrophe. What we actually ended up doing was the exact opposite: committing American taxpayers to permanent, blind support of an ungovernable, unregulatable, hyperconcentrated new financial system that exacerbates the greed and inequality that caused the crash, and forces Wall Street banks like Goldman Sachs and Citigroup to increase risk rather than reduce it. The result is one of those deals where one wrong decision early on blossoms into a lush nightmare of unintended consequences. We thought we were just letting a friend crash at the house for a few days; we ended up with a family of hillbillies who moved in forever, sleeping nine to a bed and building a meth lab on the front lawn.…”
https://www.rollingstone.com/politics/news/secret-and-lies-of-the-bailout-20130104
OK…I will be brave. (sort of)
Maybe there are no comments yet, as everyone is concerned of started an avalanche of agreement/disagreement.
At least, I would say, there are some concerns deserving attention.
I just think this is old news. Occupy Wall Street wouldn't exist if people didn't get that the banks were saved at taxpayer's expense and the financial system is a system by and for the 1%. Politics is just an extension of the financial system. There is a very large gap, and growing, between what the govt(ie: financial system and corporations) does and what the people want. Everyone feels the system is broken and corrupt. People, I think, are just stunned about what to do about it.
It's not as simplistic as all that, and the banks do NOT bear the ultimate responsibility. The gov't – specifically, Democrats – were pressuring banks because they had noticed that loan approvals depended in part on neighborhoods – and minority neighborhoods had a disproportionate share of rejections. Rather than realizing that this showed a correlation between one's neighborhood and one's income, they instead cried "racism" and pressured banks to loan these people money anyway. The banks yielded – after all, with the housing market always rising, even a bad loan can't turn toxic. Thus was born "sub-prime" mortgages, Fannie and Freddie began to accumulate them, and everyone was happy – until the housing market stalled, prices plummeted, and the houses bought by people who couldn't really afford them could no longer be sold to save the loan. And Fannie and Freddie were in it up to their eyeballs, and they were the dominoes that started the whole thing rolling. And they were bailed out with all the rest, they have never paid back a dime, and they are again making sub-prime loans to people who can't pay them back, doing their level best to create another collapse the exact, same way.
The "evil corporations" are a lie. It's isn't evil to want – to NEED – to make a profit and stay in business, and very few business – except the government – are really out to screw people.
If you want to blame someone blame the real authors of the entire debacle: Christopher Lloyd and Barnie Frank – tasked with overseeing the banking industry, even as late as a month before the crash still claimed Fannie and Freddie were solvent.
Just like Obama is this very day claiming Social Security is solvent with its "trust fund" – a cookie jar full of IOU's from the Treasury. There's no money there unless someone pays the taxes to put it in. Bankrupt, bankrupt, bankrupt, and they are still lying about it.
But, hey, you re-elected them. You're going to learn the hard, painful truth. It's just too bad we who already knew it have to suffer for YOUR lessons.
You seem to assume that there is more than one party in the US govt and that either party would do things differently. A system based on continuous growth has to get that growth from somewhere and when incomes stopped growing in the 70's and money became limited by being tied to gold, then first it was disassociated from such 'artificial' limitation and then debt became the way to keep that system growing. What you see is the ultimate collapse of that system and them the desperate attempt by the capitalist party in power to keep the party going.
We will all suffer for this illusion yes, but it makes (made) no difference who you voted for.
Yes, the system is bankrupt and unsustainable, so it is time to begin to accept it and to begin to figure out what's next, not to bandaid a broken system with the same stupid ideas.
I am suprised anonymous is not running our country. He obviously has all the answers.
Bob