More Bank BS from Obama
Okay, now I really AM finished with the news for tonight. A couple of the stronger New York banks--J. P. Morgan Chase and Goldman Sachs--are looking to pay back their TARP money. This should be good news, right? That would mean that the banks are strengthening, and the government gets out of the business of running them. Less hassle for the American taxpayer. Not so fast. The Financial Times is reporting that it's not so easy:
Strong banks will be allowed to repay bail-out funds they received from the US government but only if such a move passes a test to determine whether it is in the national economic interest, a senior administration official has told the Financial Times. [Emphasis mine.]
“Our general objective is going to be what is good for the system,” the senior official said. “We want the system to have enough capital.”
So one must ask: does anyone still believe that once the government gets an ownership stake in any business, they will really let it go so easily? If you do believe that, the statement from the Obama administration should give you pause. If a bank pays back the money it got from Uncle Sam, then the debt is closed, and Uncle can't boss around the bank as easily because it will no longer have the bank in a vise.
So who is Barack Obama or anyone else in his administration to say that a bank paying back the TARP money is not "in the national interest?" Shouldn't the goal be to get the economy moving again? And if a bank has enough money to pay back a government loan, it also should have enough money to start loaning to private borrowers again. They won't be able to get the whole system running again, as the administration official suggests they should do--but they can at least get their primary customers going again. And wouldn't that be the start of something--dare we say it--a rally?