Tuesday, March 24, 2009

Not Your Bailout

On Monday Treasury Secretary Timothy Geithner unveiled the Obama administration’s plan to finance the purchase of up to $1 trillion in so-called "toxic assets" from banks and other ailing financial institutions. The reaction on Wall St went from sour mumblings about the "socialist" in the White House, to jubilation--sending stocks up some 500 points. While corporate backers cheered, so too did corporate media, who hailed this move as a positive step. CNBC, fresh off its humiliation at the hands of John Stewart, called it a "game-changer." Over at the establishment blog Politico, Eamon Javers proclaimed the oft-embattled Geithner had "cleared the bar." And in the alternate-reality dimension that houses all things Rupert Murdoch, Fox-Business claimed the plan had "removed a huge cloud of uncertainty hanging over Wall Street." Isn't it amazing how the corporate world manages to find its bright, smiley happy face when you agree to evaporate their near worthless troubles with $1 trillion from the pockets of tax-payers? Go figure.

More below the fold...

Well, it seems not everyone is cheering. David Shuster who was pinch-hitting for Keith Olbermann Monday night probably put it best- "Wall Street loves what it hears—stocks up almost 500 points. But, is what‘s good for Wall Street also good for Main Street?" The answer from many economists and others either brave or not beholden to the whims of the corporate world have tragically answered with a resounding no. While fixing the dire banking institutions may be a part of rescuing a flailing economy, many are asking where is the bailout for the rest of us and when is enough of this corporate welfare *enough.*

On Amy Goodman's Democracy Now, nobel prize winning economist Paul Krugman bemoans that rather than seizing this moment for serious reformation and change of the financial sector, the Obama administration has given into what he terms "zombie ideas:"

A zombie idea is an idea that you keep on killing, because it’s a bad idea, but it just keeps on coming back. And what this is is we’ve had this idea since Henry Paulson came out with his plan six months ago, the Bush administration, that the real problem is that the market is undervaluing all of these toxic assets, and what we need to do is have taxpayers go in and buy them at a fair price, and that will solve all of our financial problems. And that’s what happened. The Geithner plan is a complicated, disguised variant on the same idea. It’s the zombie that you keep killing, and it just keeps coming back.

Listen or read transcript of interview here.

Speaking before the plan was announced, a disgusted Matt Taibbi at the Rolling Stone warned that the global economic crisis wasn't a matter of money, but a matter of ensuring that the status quo--those with power--remain in power and more firmly tighten their grip. What was worse, the man people (and the world) helped elect to bring about change, is helping them do it.

It's over - we're officially, royally fucked. No empire can survive being rendered a permanent laughingstock, which is what happened as of a few weeks ago, when the buffoons who have been running things in this country finally went one step too far. It happened when Treasury Secretary Timothy Geithner was forced to admit that he was once again going to have to stuff billions of taxpayer dollars into a dying insurance giant called AIG, itself a profound symbol of our national decline - a corporation that got rich insuring the concrete and steel of American industry in the country's heyday, only to destroy itself chasing phantom fortunes at the Wall Street card tables, like a dissolute nobleman gambling away the family estate in the waning days of the British Empire.

Read full article here.

Brad Reed at Alternet shoots back at the "brain-dead economic reporting" that neglects to find any criticism of this bailout, highlighting the troubling relationship between journalism and the corporate world:

Our press corps has discovered an important scoop: Rich people approve of using taxpayer money to help rich people....In case you haven't noticed, there's a common thread throughout all of this coverage, which is that Geithner's plan cannot be successful unless it wins the enthusiastic endorsement of the very rich people who drove the broader economy into the ground in the first place. Our press corps' primary gauge of measuring rich peoples' happiness is the Dow Jones Industrial Average, which it uses as a general substitute for actual economic statistics.

Read full article here.


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