Stiffed: Why Are Bailed-Out Banks Helping Pfizer Buy Wyeth?

Are U.S. taxpayers getting stiffed? Pfizer, Viagra's
daddy, is using money from taxpayer-bailed-out banks to help buy major
pharmaceutical competitor Wyeth in a $68
billion deal. That won't help taxpayers or consumers. Nor is it designed
to. It will harm the companies' workers, 20,000 of whom will likely be
laid off. It's even likely to hurt
small bio-tech companies
, drying up potential sources of capital and leaving
fewer potential major investors or purchasers.

The deal may be good for Pfizer, helping the company recover
from a $2.3 billion legal settlement over misleading marketing on the pain
reliever Bextra, and helping them amplify the clout of the $3 million they recently
lobbying against the right to import cheaper drugs from Canada. But it
won't help the rest of us.

So why are banks bailed out with taxpayer dollars furnishing
the $22.5 billion of debt financing for this deal? On NPR, a financial analyst crowed
about how wonderful it was that major banks were lending this kind of money in
the current economy. But it troubles me that among the deal's prime
financial backers--Bank of America/Merrill Lynch, Barclays, Citigroup, Goldman
Sachs and J.P. Morgan/Chase--all but the British-owned Barclays received money
from the Congressional bailout. So the funds they lent to this merger won't
be available to help smaller (or larger) companies keep their doors open
producing and selling products--ideally ones that
actually benefit
society--and not just to consolidate control over their
industry. This seems one more case of public subsidies for private gain.

I'm no economist. For all I know, maybe in some Henry
Paulson-Alan Greenspan dream world this will end up boosting America's physical
and fiscal health. Perhaps the new combined entity will come up with some
miracle drug that neither company would have created on their own. But mostly, it
seems just one more example of how a bailout without strong government control,
or even oversight, just feeds the same greed-driven abuses that have gotten us
into our current predicament. It's going to take more than Viagra to strengthen
our economy once more.

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