by Deb Cupples | Over the weekend, Bloomberg reported that execs at some of the banks that got TARP (i.e., bailout) funds want to give those funds back to us taxpayers unless said execs are allowed to continue funneling truckloads of taxpayer (or shareholder) dollars into their personal bank accounts.
Good! And we taxpayers prefer cash: no stocks; no toxic assets; no ifs, ands, or buts.
Obviously, the executive-friendly Bush-Paulson "rescue" plan hasn't worked. The credit markets are still frozen, the housing market is still slumping (as it should be given that the bubble hasn't fully deflated), and unemployment is still going up.
Perhaps Congress could use any returned TARP money to fund an economic-rescue plan that actually does work. Here's what Bank of America's CEO said about the possible giving back of TARP funds:
"Asked why some banks spurned the funding, [Bank of America CEO Kenneth] Lewis said, 'They don’t want the government involved in their business, it’s as simple as that.'” (Bloomberg)
Oh really? If Mr. Lewis (and execs at other huge banks) didn't want the government "involved in their business," then they should have done a better job of taking care of those businesses and refrained from posing such big threats to our nation's economy.
I feel like a parent telling a 16-year-old, "If you get stoned and drive recklessly, you can't use my car."
But that seems to be what's called for, given that executives at some of our nation's largest companies have (figuratively) -- sucked on a bong, got into the family car, put the pedal to the metal, and drove into a deep ditch.
And now, those same execs seem to be saying, "Fine, if you won't let me get stoned and drive fast, then I won't borrow your car."
Again, good! The auto-insurance company will be pleased.
Another issue: if a bank can come up with the money to pay back TARP funds early, does that bank really need those billions of tax dollars? If not, then why should that bank sit on those billions?
Of course, I'm out of my depth here, but FDIC chairwoman Sheila Bair said last week that if banks are able to repay TARP funds without endangering their capital levels, “'I don’t think that’s necessarily something we should discourage.'”
I don't think we should discourage it, either. Given our huge national debt (now $11+ trillion) and the anticipated budget deficits, we taxpayers could use every billion we can get back from those banks.
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