WPCNR NEWS COMMENT. By John F. Bailey. September 25, 2008: In Congress’s 7 Day Drill, reminiscent of an Eli Manning Super Bowl Drive, the “Hurry-Up-and-Save-Our-Fortunes-Stop-the-Bleeding-Save the Economy-Stop-the-Madness” hearings on the Wall Street bailout Wednesday, after some 10 or more hours of hearings in two days, of all the Senators and Congresspersons wringing hands, taunting the money white knights, Ben Bernanke, the Federal Reserve Chairman and Henry Paulson, the Treasury “Czar,” one congressman showed he is by far the smartest man in Congress.
Congressman Gregory Meeks, Democrat from the 6th District in Good Old Jamaica, Queens, was the last questioner and the man who asked the last question in the Financial Services Committee Hearing Wednesday. Mr. Meeks had the business smarts to ask Ben and Hank what assurance there is that the $700 Billion would actually be used by the financial institutions to give out loans instead of using the money to reward stockholders, keeping the bailout money on their balance sheets to attract investment and raise their stock price.
Mr. Bernanke dodged “The $750 Billion Question,” saying, and, Mr. Money said, (I’m paraphrasing) well that’s what these institutions do make loans extend credit – but he did not guarantee in any way, the money received for toxic assets would be spent with asset holders with the explicit imperative it would be earmarked for credit liquidity. Mr. Bernanke did not say it would or give any assurances. He and Hank expect, hope the robber barons will get religion and start making loans with it.
This was the most important question and most intelligent question asked in two days and Mr. Meeks is to be commended for asking it. He has brains. He’s from Queens not from the Upper East Side. And, I don’t think he owns a house on the New York Riviera in the Hamps, or the Dominican Republic yet.
Considering that Barney Frank who runs the House Committee announced early in the Wednesday afternoon hearing the house had already worked up a 42-page bill to send the Senate, it became increasingly clear this is a dog and pony show with the bailout a certainty with no certitudes.
Mr. Meeks question landed at the end of the hearing like a large elephant feces in the middle of Mamaroneck Avenue in the Columbus Day Parade. It stunk up the house chamber with its aroma of truth, as Frank gaveled the hearing to a close.
Mr. Meeks’ intelligence grenade highlighted that this money is being given without restrictions, without purpose, other than to restore “confidence.”
People on Wall Street say we need to restore confidence in the markets. Who can have confidence in this stock market that makes money on failure, insider trades, and misrepresents value?
Poppycock.
It is being given to save our fortunes – maybe. We are to believe that all these firms – and how about a list of all the firms that are going to get this money? Hundeds? No one has asked that.
Magically, it is supposed to unjam the credit system with Ben and Hank’s faithful promise that they think this is the best way to do it.
It’s good for the companies getting the money, I assure you. That’s where these guys are coming from.
Congress getting hung up on restricting the salaries of these people at companies getting the money is not productive.
Could we please follow the money through the system, as Mr. Meeks so intelligently, bluntly pointed out?
Could we please say in the bill – money received for assets will be used for new loans only or at least a goodly percentage of it?
Frankly, I have no confidence these companies will be altruistic. Once they get their manicured fingertips on the money, they will consider it their money. Hire more interns.
No Wall Street firm is altruistic. Haven’t we learned that through scam after scam: The Keating Savings and Loan Debacle, (John McCain must remember that one) (going way back) Teapot Dome, the Transcontinental Railroad scam, the Dot Com Runup, the Oil Price runup, the subprime scam. They’re con men and women.
Congress is giving this money away for them to build up confidence? Why should we have confidence in them? We have confidenced ourselves into a depression believing in them.
Of course, Hank says you cannot put restrictions on the money or limit how it is used because that would restrict the market and the ability to evaluate the assets. But, supposedly these places need the money.
I say Congressman Meeks is one smart man. How did he ever get nominated to run? Must have slipped through the 6Th District Nomination Committee undected. He better watch it asking intelligent questions. The Queens County Democratic Committee may have to recall him.
Thank you Mr. Meeks for asking the $750 Billion Dollar Question: how will we be sure the money will result in more credit being opened up? And Ben and Hank would not answer it or assure it.
The Setup
With the Senate Leader Nancy Pelosi, Chuck Schumer of the Senate Joint Economic Committee and the House leader Mr. Benoit saying they’ve agreed in Principle on the bailout means this was in the works all along. After all, all those well-heeled contributors to congresspersons, the contributors who stand to lose a lot of money in their personal fortunes have to be saved.
It is a setup for another government agency that does not work: Department of Homeland Security, FEMA, TSA.
Not to mention the reams of hearings next year on regulating Wall Street to come, with a “saved” and prosperous economy bringing America back to Number 1, and our fortunes saved
Then —
One more huge patronage bureaucracy coming up. Bring on the interns. Hire press offices. Hire more hacks. Bring on the clowns. Bring on your favorite Wall Street lobbyists and give them jobs.
Remember it’s all for the American family, to save our fortunes.
We are truly grateful, congress for your oversight, piercing questions, and canny financial acumen in vetting this $750 Billion measure in a week.
I want more Gregory Meeks-es in Congress. Or at least one Gregory Meeks on the White Plains Common Council and School Board.
Thank you Mr. Meeks, keep asking that question.
We who are about to pay, salute you.
Could we please get in free to your next fundraisers, Senators and Congresspersons in the Hamptons? Or Lincoln Center.
