Tim Geithner told the Today Show that:
It’s “deeply unfair” that some financial institutions that got taxpayer-paid bailouts are emerging in better shape from the recession than millions of ordinary Americans.
Geithner also argued that President Barack Obama had no choice when confronted with a financial crisis.
“As the president has said, we had to do some very unpopular things,” Geithner said. “People looked at what had happened.”"It’s not fair. It’s deeply unfair,” he said. “He (Obama) had to decide whether he was going to act to fix it or stand back … and that would have been calamitous for the American economy.”
There are only a couple of minor inaccuracies in Geithner’s statements:
- The government hasn’t done anything to fix the economy
- Geithner’s entire approach is wrong, because the economy can’t recover until many of the “financial institutions that got taxpayer-paid bailouts [and] are emerging in better shape” are broken up
- The government has been anemic in addressing unemployment
Moreover, it is not like their approach fell on them and they couldn’t do anything about it. Geithner, Summers, Bernanke and the boys made a conscious decision to side with the oligarchy at the expense of the people.
As Simon Johnson and James Kwak write:
[There was a] point at which the government had to decide if it would defend the financial oligarchy from populist outrage, or whether it would reform the financial system that brought us the financial crisis and severe recession. We do not think it was an easy choice. But ultimately Obama and his advisers chose to bet on the bankers they knew. The result has been even larger banks and an even more concentrated financial sector.
Geithner also told the Today Show that he hopes skeptical voters will note legislation moving through Congress to bring reforms to the financial system.
He’s banking, of course, on the fact that many voters won’t realize that the legislation is a placebo containing no real medicine.
Geithner ended the interview with this pearl of wisdom:
“What happened in our country should never happen again,” he said. “People were paid for taking enormous risks. It was a crazy way to run a financial system.” Geithner said, “It’s the government’s job … to do a better job of restraining that kind of risk-taking.”
Indeed … too bad that Geithner and the boys are still encouraging that kind of risk-taking.
Geithner was, of course, largely responsible for much of the failure of the government to restrain risk-taking in the first place.
As William Black points out:
Mr. Geithner, as President of the Federal Reserve Bank of New York since October 2003, was one of those senior regulators who failed to take any effective regulatory action to prevent the crisis, but instead covered up its depth.
Geithner was also complicit in Lehman’s accounting fraud .
And pushed to pay AIG’s CDS counterparties at full value, and then to keep the deal secret.
And as Robert Reich notes today, Geithner was “very much in the center of the action” regarding the secret bail out of Bear Stearns without Congressional approval.
Indeed, the list of Geithner’s hinky actions grows longer by the day as new facts emerge.
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DNA & Pandora’s Box
The cartels turned the global economy into an integrated circuit, upon the advise of professors, and with the aid of many, on the assumption that ICs were cheaper and easier to replace than workers, to minimize cost, and on the assumption that they could extort ignorant and isolated consumers, to maximize revenue, creating $500T in unfunded liabilities in the process, which are now due.
Unfortunately, the workers are the consumers, revenue cannot be disassociated from cost, and producers and consumers are only separated by the fictional hinge we call capitalism, by a hat. They fried the motor. Evolution is anything, but cheap and easy.
From the perspective of the planet, there is no difference between a tree and a human. The planet was here long before humans, and will be here long after, unless the universe decides otherwise. Every sub-system has to earn its keep, by producing an evolutionary profit, by increasing diversity of action on mass.
Else, Pandora’s box.
Printing money is not bad in and of itself, but a feedback loop to reward issuers/users for doing something productive with it is necessary. Ultimately, money is like a set of training wheels. This economy is a vegetable on life support because the monetary hoarding and obfuscation feedback loop rewarded complete global integration, toward the end of cartel control, through the hoarding of non-productive assets, and its result, artificial scarcity.
Hiding all the components out of sight, all on one too-big-to-fail, black-box IC chip, failed, because of all the reasons all boards fail, and the assumption of IC boards, that they are easy and cheap to replace, doesn’t work for a global economy. It’s one thing to get every last horse out of a motor; it’s another to design, build, install, and maintain a motor.
Efficiency is at a premium in the first, and effectiveness is at a premium in the latter. To accomplish the latter, individuals need to see the system in its entirety, and have the will to act, so they can effectively deploy their talents. Efficiency, beyond fulcrum balance, crowds out effectiveness in a self-reinforcing feedback loop, creating a cancer of obsolete specialization.
DNA maintains its history because environments are recursive, but it grows as it learns, in a symbiotic relationship with a growing environment. Slicing and dicing the DNA to meet short-term objectives has its price.
The cartels that wish to survive will cut out all the middlemen and pay individuals well to learn, in quality of life, not with promises on paper. The merry-go-round is not a draw for those with the required skills. The university/healthcare root of the cancerous nexus will be a sunk cost for some time to come. It will have to be set aside.
Replacement jobs at Best Buy, Verizon, Lowes, Comcast, and the Census are not going to cut it.