Tuesday, September 23, 2008

The Vault Is Open: Have Some

Why not? Everyone else seems to be getting in on the game.

As the lobbying and politicking proceed on the government’s proposed bailout of banks and other lenders holding iffy paper (not necessarily related to mortgages, it now appears), one thing is perfectly obvious: if you invite people to steal from their fellows, using the government as a middleman, a great many will avail themselves of this opportunity.

The government’s proposal was originally aimed at aiding commercial and investment banks, ostensibly to relieve the so-called credit crunch. Other plutocrats resented being left out, however, and they have quickly marshalled their political forces to gain a piece of the action. As the New York Times reports, “nobody wants to be left out of Treasury’s proposal to buy up bad assets of financial institutions.”

So, the Times reports, the Financial Services Roundtable is urging that “a wide variety of institutions should be able to take advantage of the bailout, and that these companies should be able to sell off any investments linked to mortgages.” And why, pray tell, “should” they have such a privilege? Why, simply because the booty is there for the taking, and no one should get it while others go without!

Already the scope of the government’s proposal has been widened to allow the Treasury to buy not only mortgage-related paper, but “any other financial instrument.” After all, why be stingy, especially considering that it’s not the Treasury officials’ own money they’ll be spending, but yours and mine, dear taxpayer?

Small banks want the government to buy “loans they made to home builders and commercial developers.” Big banks want certain accounting rules suspended “to avoid taking big losses on the assets they sell to Treasury.” I want a maid, a gardener, a valet, and a cook, along with a few billion dollars to tide me over until my next mistake.

Other bankers are pushing to include municipal securities in the plundering free-for-all, “as part of a broader effort to restore investor confidence in money market funds”—and, by the way, to save their own rear ends.

Big financial firms are angling, too, to become the government’s agents in handling all the “securities” it is about the acquire with the $700 billion (or—don’t be surprised—more) it will spend to carry out this travesty of saving civilization.

No comments: