They came. They saw. They ran away.
The recent big global finance summit session was a far cry from the “veni, vidi, vici” of Julius Caesar. Rather than conquering the spreading problem of economic collapse, the leaders of the world’s 20 most powerful economies dithered, blathered, postured and then fled for home.
Still, a White House official who spoke for our stalwart leader, George W., insisted to reporters after the show that average Americans should “take comfort from what happened today.” Uh, why? Because the leaders showed that they understand “the depth of the economic problems,” he said. Wow, I certainly feel better now, don’t you?
But, wait — the so-called Group of 20 didn’t leave us totally empty-handed. While the Groupees didn’t actually do anything, they did issue a neat set of principles for all nations to ponder:
— Reinforce cooperation.
— Improve regulation.
— Promote market integrity.
— Reform international financial institutions.
— Strengthen transparency.
Double-wow! A high-school football coach couldn’t have done a better job of posting motivational platitudes on the locker room walls: Reinforce! Improve! Promote! Reform! Strengthen!
And if that doesn’t comfort you, be assured that the Group also agreed to meet again next spring.
Meanwhile, not only does the economic crisis rage on, but so does Washington’s unlimited bailout of those who caused the crisis. The star of this financial version of “Girls Gone Wild” is bailout chief Hank Paulson, who keeps going all-out to satisfy the wildest fantasies of financial honchos, literally hurling ever-more-billions of our tax dollars at them.
Maybe you think that the total tab for the administration’s giveaway bill will be $700 billion, since that’s what Congress authorized. If only. As one Wall Street insider put it: “Let’s be realistic, $700 billion is not enough. I think it’s the ‘T-word,” meaning a trillion bucks. Indeed, various financial institutions, such as insurance giant AIG, have received their handouts, then stepped right back in line for seconds and thirds. Their slogan seems to be: Too much is not enough.
If you’re not a bank and therefore technically ineligible to party with Paulson, don’t worry, for he will simply declare you to be a bank. That’s what he did for American Express. When the credit card giant knocked at Treasury’s door this month, Paulson redefined it as a bank-holding company, gave it the secret password and let AmEx reach in for a $3.6 billion party favor from you and me.
Now comes news that the Bushites have secretly created two additional bailouts for America’s financial barons. First, Federal Reserve Chairman Ben Bernanke has quietly slipped some $2 trillion in emergency rescue loans to bankers. Yes, trillion! Which banks? That’s a secret, says the Fed. How much did each get? A secret. What did the banks put up as collateral to protect taxpayers? A secret.
The second giveaway involves an astonishing power play by Paulson. He recently issued an executive decree to nullify Section 382 of the tax code. Passed by Congress 22 years ago, this provision makes it illegal for banks to play a shell game that uses dummy corporations to dodge taxes that they owe. Bush’s treasury secretary, however, wants big banks to be able to use these scams as a backdoor way of subsidizing their takeovers of smaller bank competitors. So — Shazam! — Paulson imperiously declared the law void.
Can he do that? No, say legal experts. But he did. Thus, when Wells Fargo took over Wachovia in October, it got about $25 billion through this tax dodge — more than the total price it paid for Wachovia. Overall, Paulson’s “veto” is expected to cost our public treasury another $140 billion.
And what has Congress done about his rank usurpation of power? Nothing. A top
congressional staffer says, “We’re all nervous about saying that this was illegal because of our fears about the
The marketplace? What about the Constitution?
Jim Hightower is a national radio commentator, columnist and author.