Photo Credit: Associated Press

By l.t. Dravis

LOS ANGELES, CA – Friday, November 14, 2008 – HEY, TREASURY SECRETARY HANK PAULSON . . . what the heck’s going on?

            Less than a month ago you said government purchases of stock in banks stuck with so-called ‘toxic assets’ (talk about an oxymoron), represented a good investment for taxpayers. You said the government (nee taxpayers) would own shares in the form of warrants issued by banks. “This is an investment,” you said, “not an expenditure, and there is no reason to expect this program will cost taxpayers anything.”

Your immediate plan was to spend $250 billion in direct stock purchases; half of those dollars would go to the nine largest banks in the country and the other half would go to buy stock in thousands of other banks. Though the big nine banks would be receiving nearly $14 billion each, you didn’t require them or any of the other thousands of banks and other financial institutions to lend any portion of any of those taxpayer billions to business and/or consumers.

You said that taxpayer cash handed out by the Troubled Asset Relief Program (TARP), would increase banks’ confidence so they will “deploy, not hoard, their capital,”

TRANSLATION: If we give banks billions of dollars, they’ll lend it!

Okay . . .

Given everything you said up to October 20, thinking taxpayers would think your plan was working . . . that business and consumer lending would begin to ‘free-up’; that the hemorrhaging of jobs would slow or even stop; that the rate of foreclosures would begin to decline; that some of us might even be able to sleep the whole night through.

Then, on Wednesday, November 12, you suddenly announced that you were abandoning the idea of purchasing bank stocks (aka ‘toxic assets’); you said, however, that you were going to continue to use (the balance of) $250 billion (36% of the $700 billion) to buy stock in banks to ‘encourage them to resume more ‘normal lending’.

And, if I was confused before Wednesday (and I was), I’m really confused now, Hank.

Does your turnabout mean the original plan, your plan, was the wrong plan?

If so, why did you present it in the first place and why did the House and Senate go along with it?

You told CNBC today that the ‘facts had changed’ which caused you to abandon your original plan.

Okay . . . does that mean the banking system that was in such bad shape less than a month ago is now in good shape?

If that’s the case, why not put our checkbook away, finish your work with the transition team, and finalize your post-January 20 vacation plans?

But, wait a minute, you are still Secretary of the Treasury and, despite the quarter of a trillion dollars you’ve doled out to banks, the economy is still in the tank (not for you, not for the big shot Wall Streeters who’ll run like rats with million dollar bonuses and golden parachutes, not for George W.

Bush or Dick Cheney or any of the rest of the Bush bunch who will ride off into the Washington, D.C. sunset with cushy pensions, book deals, and lives of privilege and ease) for the millions of hard working Americans and their children who are paying and will continue to pay with lost jobs, savings, retirement accounts, homes, and dignity for Wall Street greed and Washington incompetence.

So, what will you do with the remaining 64% of the $700 billion to protect millions more businesses, jobs, families, and homeowners who’ve been put at risk by greedy financiers and inept politicians?

At this point, Hank, you may be wondering (as I’m sure you’ve wondered thousands of times in the past several months), how did you become responsible for saving the entire economy of the United States of America?

In other words, who died and made you the big economic Sheriff of America?

Well, Sheriff Paulson, you got yourself in this spot by accepting a job with an administration too stupid, too incompetent, and too short-sighted, for too many years to build a strong, vibrant, flexible economy.

And, while we all understand that George W. Bush, Dick Cheney, Donald Rumsfeld, Alberto Gonzalez, et al, were stupid, we can’t ignore the fact that the House and Senate were even stupider.

The House and Senate allowed all those stupid people, Bush, Cheney, Rumsfeld, Gonzalez and the rest of the Bush bunch, to run the country into the ground . . . for nearly eight very long years.

So, here we are . . . relying on you and the best and the brightest in the Department of the Treasury to save the nation and what have you done?

You’ve spent more than a third of the $700 billion and the credit crisis is still in crisis, hundreds of thousands of people are losing their jobs each week, foreclosures continue to climb, bankruptcy filings continue to increase, and there is no reason to believe anything will change any time soon.

Doesn’t sound like we’re getting much for our money, does it?

Mind if I ask a question?

If I worked for you at Goldman Sachs and I handled my job like you and your group have handled this bailout mess, would I still have a job?

And, if not, why not?

           

Copyright © 2008 by LTD Associates West, Ltd. All rights reserved.

 

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