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Today's Top News
Geithner’s All Ears for Debt Cartel
Months ago, a former chief economist at the IMF called it mind control. Talking to Simon Johnson of the Atlantic Monthly, he explained that one of the most alarming truths laid bare by the economic crash was that the finance industry had effectively captured the thinking of government.
“That’s going too far,” said reasonable people. “This is no Banana Republic run by crony cartels.”
That was before we read Tim Geithner’s phone records.
Thursday’s AP report shows executives at a handful of companies — Citigroup Inc., JPMorgan Chase & Co. and Goldman Sachs — had not just the ear, but both ears of the Treasury Secretary to the exclusion of other even bigger and more troubled banks, and legislators.
As AP points out, Geithner had more contacts with Citigroup than he did with Barney Frank, D-Mass., the lawmaker leading the effort to approve Geithner’s financial overhaul plan. And Geithner’s contacts with Lloyd Blankfein, the chairman and CEO at Goldman, way outnumber his contacts with Sen. Christopher Dodd, D-Conn., chairman of the Senate Banking Committee.
After the week this May when GM almost went bankrupt and the government was considering a federal takeover, the treasury secretary called Blankfein, then Jamie Dimon, the boss at JPMorgan. Then Obama called and as soon as they hung up, Geithner was back on the phone with Dimon. Poor California Democrat Xavier Becerra — who handles silly stuff like taxes and budgets. He had to leave a voice-mail message. And Geithner wasn’t talking to all bankers — mostly with people he served on nonprofit boards with, and hung out with socially.
So. . . where others have drug cartels, we have a debt cartel? It’d be clear by now if Geithner was just listening to his friends to hone his arguments against greater bank consolidation, debt securitization and finance over industry but Geithner has yet to show any sign of breaking with his Wall Street pushers.
In a Banana Republic we’d pay out protection money. Oh, but I forgot, we did that already.