George Graham

Why Do Americans Let the Banks Get Away With Robbery?

I’ve been saying for some time that the “bailout” of failed financial institutions is an elaborate scheme to plunder the American Treasury, and I’ve been wondering why President Obama has continued the policies of the Bush Administration in addressing the U.S. banking crisis.

pettiforToday I came across a Huffington Post article by Ann Pettifor (photo at right), an economist, author and analyst of the global financial system, that leaves no doubt in my mind about the absurdity of the bailout program. And I was impressed by her appeal to the American public to rise up and put a stop to it.

According to Ms. Pettifor:

The US administration has itself been hijacked, and America is now, effectively, a Bank-Owned State. Democracy has been usurped by what Abraham Lincoln called ‘the Money Power’.

She adds:

Thanks to the 2008 heist, $700 billion of ‘Troubled Asset Relief Funds’ (TARP) was siphoned out of taxpayers’ pockets and into bank coffers. The heist was pulled off in classic ‘Shock and Awe’ style, with virtually no questions asked….

Goldman Sachs took Secretary Geithner hostage, and drained down $12.9 billion of AIG bailout funds; Merrill Lynch tapped $6.8 billion, the Bank of America $5.2 billion, Citigroup $2.3 billion and Wachovia $1.5 billion. Regulators (The Financial Accounting Standards Board) surrendered, ignored the lack of provision for loan defaults, and then weakly agreed that banks could inflate the value of their assets.

In the meantime, blindfolded Treasury Secretary Tim Geithner promised to hand over $500 billion to $1 trillion in the form of a ‘Public-Private Investment Program.’ This would create a new gambling casino for hedge-fund outlaws – one in which the hedge funds win, and the FDIC loses. To pay for this effective give-away Geithner had to raid (tax) small and medium healthy banks to subsidize the gambling of their larger, more reckless – and too-big-to-fail – competition.

While the banking outlaws were roaming around administration buildings, the U.S. Treasury Secretary timidly suggested they test for fitness by jumping hurdles. They weren’t putting up with that, and so, it is rumored, Geithner has backed down, and set the bar very low. We are still waiting to know more about the stress tests, but it seems the Treasury Secretary has been silenced. 

But Ms. Pettifor reassures us that the banks “can’t get away with cooking the books forever. As with Enron, some day the sheriff will walk through the door.” And she says:

Bankers do not deal in the real economy. You and I do that, by working, caring for others and producing goods and services. They need us to keep that up, if they are to keep their grip on government, and siphon off our hard-earned surplus. But by raiding government coffers and squeezing the economy dry, the bankers may be cutting the ground that is the real economy from underneath them.

(And) the bank outlaws have failed to spot a big cloud on the horizon – Climate Change – and are not prepared for the shocks that extreme weather events will cause to their business and the economy as a whole.

Ms. Pettifor calls for “an alliance between Labor, Industry (i.e. all those engaged in productive activity by hand or brain) and the Greens – to challenge the bankers.” Here’s her plan:

It means uniting – as communities – to defend families and businesses from foreclosures. It means standing together and challenging the bankers – holding demonstrations outside banks, educating ourselves and our communities about what has happened.

It means holding elected representatives to account for their record on this issue; and throwing them out if they collude with the outlaws.

And it also means changes to our lifestyles – less borrowing, less dependence on the banks, and less consumption, to make the world more sustainable – and to remove the power of money over the way we live.

If Americans don’t organize politically to transform the bank-owned state to make it accountable to the people – then God help American democracy. But if Americans do once again organize to defend hard-won democratic gains, then in the words of Abraham Lincoln “Money will cease to be master and become servant of humanity. Democracy will rise superior to the money power.”

Amen to that! With so many elected representatives – Democrats as well as Republicans – in the pockets of the banking barons, the interests of the public don’t matter much in Washington. It seems that not even President Obama – with his charisma and popularity – can get Congress to put a brake on these thieves. It’s up to hard working, taxpaying Americans to fight for themselves.

About the author

gwgraeme

I am a Jamaican-born writer who has lived and worked in Canada and the United States. I live in Lakeland, Florida with my wife, Sandra, our three cats and two dogs. I like to play golf and enjoy our garden, even though it's a lot of work. Since retiring from newspaper reporting I've written a few books. I also write a monthly column for Jamaicans.com