Is America Set To Nationalize Banks?
By Wyatt Earp | February 18, 2009
Embrace socialism, beyotches!
Long regarded in the US as a folly of Europeans, nationalisation is gaining rapid acceptance among Washington opinion-formers – and not just with Alan Greenspan, former Federal Reserve chairman. Perhaps stranger still, many of those talking about nationalising banks are Republicans.
Lindsey Graham, the Republican senator for South Carolina, says that many of his colleagues, including John McCain, the defeated presidential candidate, agree with his view that nationalisation of some banks should be “on the table”.
Oh, absolutely. Hell, while we’re at it, why not nationalize health care, the schools, the media, and fabulous babes?
Mr Graham says that people across the US accept his argument that it is untenable to keep throwing good money after bad into institutions such as Citigroup and Bank of America, which now have a lower net value than the amount of public funds they have received.
“You should not get caught up on a word [nationalisation],” he told the Financial Times in an interview. “I would argue that we cannot be ideologically a little bit pregnant. It doesn’t matter what you call it, but we can’t keep on funding these zombie banks [without gaining public control]. That’s what the Japanese did.”
Oh sure. We’ll nationalize the banks, but not use the word “nationalize.” Good plan, Lindsey. Jackass!
Barack Obama, the president, who has tried to avoid panicking lawmakers and markets by entertaining the idea, has moved more towards what he calls the “Swedish model” – an approach backed strongly by Mr Graham. In the early 1990s Sweden nationalised its banking sector then auctioned banks having cleaned up balance sheets. “In limited circumstances the Swedish model makes sense for the US,” says Mr Graham. (H/T – FT.com)
I agree. I prefer the Swedish model . . .
Swedish model Elin Grindemyr
. . . but not a Swedish model for nationalization of the banks.
Topics: Duct Tape Advisory | 7 Comments »
February 18th, 2009 at 10:23 am
Ask my SIL, who spent three years in England, about her opinion of national healthcare. And keep that in mind when considering that for any other service.
February 18th, 2009 at 2:26 pm
Again, I lost the message after seeing the Swedish model.
Were on a slippery slope to socialism.
February 18th, 2009 at 3:58 pm
I’ve always been suspicious of Lindsey Graham’s motives, even when others were talking of how level-headed and wonderful he was.
To steal a line from the younger generation- Politicians are made of fail.
February 18th, 2009 at 4:50 pm
Great idea! After all, government bureaucrats have done such a fantastic job running the government, why not put them in charge of banks?
Sounds like this might be a good time to start burying my money in coffee cans in the back yard.
February 18th, 2009 at 7:01 pm
Graham and the others are using the term ‘nationalization’ to describe the ‘Swedish Model’ in order to avoid using a more scary word for what it really is.
Its receivership.
As is ‘FDIC failing bank’ receivership or ‘Bankruptcy Court Ch.11′ receivership.
Leaving out the details, the proposals are to basically forcing these insolvent banks through the same process the failed S&L’s were forced through 20 years ago.
In other words, the government takes them over, throws out existing top management, slices out the bad assets, and then reprivatizes it.
Some proposals (which I support) would have the Feds separate the investment banking and commercial banking parts and forbid them from joining back up after the spinoff back into the private sector.
This keeps the sharks on Wall Street from using your and my FDIC insured bank deposits as a stake in the casino..err..Stock Exchange.
February 18th, 2009 at 7:10 pm
Oh, and I am kind of partial to this Japanese Model
February 19th, 2009 at 3:38 pm
Doghouse – We have friends in Canada. The wife is pregnant and her first OB-GYN appointment is a month before her due date!
Admiral – Sorry about that. I gotta stop posting those pics.
Snigs – Never been a big fan of Graham. Typical slimy politician.
John D – Or under the bed.
Glocksman – That’s all dependent upon whether or not the spinoff is allowed.