Why Keep Geithner?
A year ago it was revealed to the American people that our banking system is a legalized Ponzi scheme in which bank and insurance CEOs pay themselves billions of dollars in personal compensation to lend and insure assets with money they don't have to customers who can't pay back the loans.
In those dark days between the fall of Lehman Brothers and before the presidential election, we were often carried through that time by the small glimmer of hope that at least we would soon have a new leader who would hopefully fix this mess and punish those responsible.
Yet in the past 9 months, not only has the administration failed to fix anything, they have actually made things much worse for anyone who isn't a Wall Street banker. Therefore, we are past the point where anyone in power still gets the benefit of the doubt -- the process of taking back our country for all citizens must begin now.
This is why I think we must ask if U.S. Treasury Secretary Timothy Geithner is still the right person for the job. It has become clear recently that, back in his previous role as New York Federal Reserve Governor, he unnecessarily gave billions of dollars of US tax money to banks and insurance companies with few strings attached. And it is now becoming clear that his lack of meaningful action is helping many of these same banks steal more by legalizing their most economically dangerous, socially destructive and self-enriching practices.
Yesterday on NBC's Meet the Press, Secretary Geithner again endorsed House bank reform legislation that would allow, by my calculations, as much as 80%, or $475 trillion, of the bank's $600 trillion in crooked insurance schemes to still be held in secret. It was and is the secret risks held in this very market that led to our collapse in the first place, and that continue to pose massive future risk to the global economy.
Geithner also continued to employ the bankers' favorite and most ludicrous lie : that the taxpayer must somehow continue to pay executives at companies like AIG ungodly sums of money under the threat that, if we don't, somehow the taxpayer will never make their money back. Well let me tell you something, the taxpayer and our nation will never get back the lost wealth taken under these false circumstances and this colossal breach of fiduciary duty. The idea that we must somehow perpetuate this system with our tax money and the future wealth of our children goes against the very American ideal of failure, adaptation and innovation, not to mention of our democracy.
Also last week, the Treasury Secretary endorsed a piece of legislation that, instead of stopping a select few companies from profiting from the implicit taxpayer-guarantee of Too Big Too Fail, seeks to officially condone it. If the most prized skill in our society, economically, is the ability to lend and insure the most money without consequences, then our nation's people are doomed to lose everything in the world's largest ever betting parlor; and that is precisely the system this Treasury Secretary -- Tim Geithner -- is seeking to legalize and institutionalize in America today.
However, the smoking gun for Secretary Geithner comes from a recent Bloomberg FOIA disclosure regarding events from last November. It was then that New York Federal Reserve Governor Tim Geithner decided to deliver 100 cents on the dollar, in secret no less, to pay off the counter parties to the world's largest (and still un-investigated) insurance fraud -- AIG. This full payoff with taxpayer dollars was carried out by Geithner after AIG's bank customers, such as Goldman Sachs, Deutsche Bank and Societe Generale, had already previously agreed to taking as little as 40 cents on the dollar. Even after the GM autoworkers, bondholders and vendors all received a government-enforced haircut on their contracts, he still had the audacity to claim the "sanctity of contracts" in the dealings with these companies like AIG.
None of us were in the rooms when these decisions were made, so I don't pretend to know if Mr. Geithner was the one lone, sane voice of reason fighting against mysterious forces or the primary proponent. However, I fail to see the reasoning for why we continue to rely on those who were in the room when these horrendous decisions took place to be the same people that we choose to deal with their aftermath. There are just certain situations that are not suited for continuity. The best analogy I can think of is that it would be like asking Al Cowlings to spearhead the Nicole Brown Simpson murder investigation under the premise that he knows the layout and the "players" best.
The fact is that there are people who understand all of the intricacies of finance and policy as well as Secretary Geithner, but whose allegiances to the taxpayer are much clearer. People like Elizabeth Warren, Neil Barofsky, Rob Johnson, and Senator Maria Cantwell just to name a few.
To stop the theft from continuing, the most basic rules of capitalism need to be applied to our banks. And the future of our national wealth needs to be safeguarded by the US Government. The current custodian of America's wealth, Treasury Secretary Tim Geithner, is not doing a good job of either. The time for corrective action is now.
Follow Dylan Ratigan on Twitter: www.twitter.com/DylanRatigan
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Another terrific column by Ratigan. Is that the IRS knocking on your door?
Ok Dylan who do you suppose is a suitable alternative, besides Cramer of course?
Two words: Elizabeth Warren.
This article is a perfect example of why i come to Huffington Post for news. Thank you so much for being part of the solution instead of part of the problem. I wish others would follow suit.
I'm shocked at how much crime has gone unpunished. Shocked at how much of what happens in Business, and Washington is NOT ILLEGAL. It's as if after the biggest bank robbery in the history of the world, after catching the criminals, we were to say that because they said "thank you" as they left the bank with bags of money, it's not considered theft, and we've decided to let the criminals keep the money because they really were only doing their job. It's not their fault that their employers gave them a shot gun and told them to hold up the bank, and well... we could prosecute the leader of the gang of criminals, but we are not in the business of looking back. As a citizen of the United States of America, I feel as if my country should change it's fundamental credo to:
We the corporations of the United States of America, In order to form a more perfect profit margin, hold these truths to be self evident - That all people with money are more important and entitled to special privileges all men otherwise have the right to suck it! -That to secure these rights Corporations are instituted off shore so they may be immune to the laws of the land and may derive their powers from the consent of politicians whom they have paid to put the concerns of the powerful above the concerns and or consent of the governed.
Our government has turned into a real disappointment. It's much too hard on the wrong people. The honest hard workers are doing all the lifting for the greed few still at the wheel.
The wheel needs to be taken away.
Unfortunately, elections don't seem to be the cure they once were...
Elections are not the cure they once were because both parties are beholden to the same campaign donors and lobbyists. So they say different things on the campaign trail and act the same once in power.
CAMPAIGN FINANCE REFORM -- no more corporate funding to lawmakers! It's corruption, plain and simple, but many have no idea. Imagine having our airwaves and newspapers telling us truth, and not everything being FOR PROFIT (health care, post office, railroads, parks & recreation, police, safe food, air & water, etc.). Some things are better served by the public (the commons, i.e. the government).
Corporations are making us sick, and working us to death, and robbing us (and the Treasury) blind.
We used to have a democracy that looked after the people. Ayn Rand and her acolyte Ronald Reagan started the party of ME, ME, ME, SCREW YOU. And look where we are.
Why keep Geithner? For the same reason that, in the year since the latest financial meltdown of Oct. 2008, we don't have ANY banking reform measures passed into law yet. This also explains why Geithner was named Treasury Secretary in the first place, let alone why is Timmy kept in place. Ditto for Hank Paulson. Marcy Kaptur (D-OH) has used the term financial "coup d'etat" to describe what has happened to the American Public and the bank 'bailout'.. It is becoming more and more apparent that at the Federal level of government, there is NO ONE who will speak for and protect the interests of the average American. Sleazy.
Voelker is the only one who could steer through this mess with the interests of the COUNTRY at heart, not banks, Wall Street, and the money elite. But the administration won't listen to him, and the government keeps on stealing from the poor to give to the rich. It ain't gonna' work this time.
Timothy Franz Geithner doesn't work for Goldman Sachs, he just acts that way.
He can use his job as U.S. Treasury Secretary to pave the way to a real job of scamming the taxpayers with Goldman Sachs. He needs at least a 5 year ban on working for any firm that he has had dealings with while holding public office.
Or perhaps he has already received his reward and we just don't know it.
Congressman Mel Watt (D-NC) is trying to gut HR 1207 (audit the Federal Reserve bill). Contact him http://watt.house.gov/contactinfo.asp and your Congressperson and let them know watering down this bill will have consequences.
all our leaders are taking us down. It's all about the OnePercent and how we can best serve them. Nothing's CHANGEd.
Dylan, you are so right, and most people are so NOT listening. Geithner is just symptomatic of the real failing: no campaign law reform. Until the campaign laws ban individual contributions to specific politicians, nothing will change, PERIOD!!!! The President, God love him, would like to stand for change, but he is like a minnow trying to swim upstream against sharks. Unfortunately, though I believe that Tim Geithner is well qualified to do his job, he has been coopted by "Wall Street Think" having spent way too much time around the Street and its executives (note that they are the only bankers he talks with). He believes that they are the contractors building a highway to economic salvation for this country, and he's not listening to the discredited Greenspan, Volker, Stiglitz, Krugman, Simon Johnson, Niall Ferguson, or any of the other great economic minds, but only to (former Goldman exec) Summers. Summers is just helping his cronies, PERIOD!!!
So, nice column and all, but it is preaching to the choir and spitting into the gale. Within two years we will have some kind of violent revolution, as the unemployed arm themselves to fight those who would trample them.
It seems to me that in recent history going back through the Clinton administration, a tour at Goldman Sachs has been a de facto requirement for appointment to the post of Treasury Secretary!
Is it just me, or is it time to appoint someone who hasn't worked at Goldman or any of the other modern "robber barons"?
I say fire Geinter and nominate Elizabeth Warren - someone who clearly has the intellect, but more importantly a belief that the system should serve the masses instead of the handful of so-called "Masters of the Universe" on Wall Street!
The Bolsheviks in Russia revolted.....why can't we???????
Why keep Obama, Nancy and Harry?
Why, indeed.
It's too late to correct the Geithner mistake.
Our economy is screwed!
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