Posted by
billyLevine on Thursday, December 17, 2009 2:37:41 PM
Humpty Dumpty Sat On a Wall
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There is only so much reading between the lines that one can do before coming to the conclusion that America is taking socialism for a test drive. For all practical purposes, the government is now the new owner of more than 350 banking institutions across the country, and more will be added to the list as other institutions fail and request stimulus support.
By taking control of the bonus and salary structure of the banks slated to receive stimulus money, the government is the de facto owner - calling the shots previously the domain of CEO's and corporate boards of trustees. Salary caps and bonuses are now the province of the federal government, and if it makes it easier for you to swallow, call it federalization...the end result is still the same.
Is this a good thing? It depends on your perspective. Some argue that the stimulus program is simply a federalized act of philanthropy designed to boost the economy back into orbit and prevent the domino effect that is sure to follow as smaller institutions beg the royal court for help. Others, argue that every word in the stimulus package smacks of socialism, simply by virtue of the transfer of power to the government.
The plan is comprehensive and quite clear on this transfer of power; federally monitored salary and bonus caps send a mighty strong message and it goes something like this: "If we give you assistance, you are beholden to us for all of your financial decision making." If you don't think that means total control, think again because financial decisions are at the core of operations for the banking industry.
The stimulus plan is socialistic in concept and implementation; the question left un-answered is "How will this affect stockholders who hold shares in federally controlled enterprises?" The possibilities are disturbing at best and catastrophic at worst. Perhaps we need an Economic Sedative Package as well.
I do not believe that socialism is a real issue here - unbridled greed is the issue we must deal with and unfortunately, the stimulus package fails to address the enormity of white collar crime that continues to bleed and fleece the American people. The plan avoids the facts, thereby making it possible for greedy investors to capitalize on the misfortune of others. Remember, this plan was figuratively formulated overnight and as such it has loopholes...some of them big enough to accommodate the QE3 without so much as a scratch on her hull. The real test is yet to come when greed surfaces as it always does - where the money is. When the people's money supply is vulnerable to tampering, something far worse than federalized control of banking is an issue and the “trickle up” process can be identified now because it is already in motion. While the fat cats feast on our hard earned cash, history repeats itself and the signposts of economic catastrophe are evident...people are losing trust in the banking industry as a whole and more than half the country distrusts this plan and the man behind it.
If the people lose all trust and panic, the entire system (which is only a house of cards anyway) crashes, and all the King's men won't be able to put that back together again. Remember - this Stimulus “Scheme” is funded by toxic and illiquid debt...who pays for that? Right, we do. Middle class Americans will pay heavily and at the top of the Stimulus Pyramid our money will be re-distributed to the same people who got us into this mess to begin with.
Socialism? Does it matter, really? We are now witnessing Humpty Dumpty economic policy. Weren't we told long ago to stay off that wall?