January 9, 2009
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Citigroup Our Saviors?
Yesterday with much fanfare Citigroup endorsed a bill to make fundamental changes to the bankruptcy laws to protect homeowners who are in danger of losing their homes through no fault of their own.
The reaction to this announcement has been quite instructive to understanding the way Democracy works in the United States. Citigroup is being praised as being farsighted leaders, taking real initiative to make the world a better place and save us from the impending disaster reflected in the current economic downturn. They are our Heroes! Hooray for Citigroup!
Give me a break.
Let’s have a little perspective. Citigroup and banking institutions like it got us into this mess with rampant speculation and leaving the society as a whole to cover the costs of their RISK. Then they begged for and got an enormous amount of money from bailouts from our Government without which they would likely be the ones filing for bankruptcy now right along side the homeowners they screwed.
And now they come back and say they support a perfectly reasonable bill that puts some small amount of control over banks to the benefit of the consummer. Only it’s a bill that COULD have been passed long ago and might have lessened the devastating impact of this crises on numerous home owners had it been passed. Only it didn’t. Why not? Because banks, including, you guessed it Citigroup blocked it. And now we are supposed to praise them for their benevolence and farsightedness? Ugh.
It get’s worse too if you dig a bit into the details of this story. Because Citigroup a bank in desperation suffering as much from the Financial Crises as anyone, did not come to the government and humbly ask “how can we help?” Oh no. They said “we’ll support this bill, ONLY IF this, that, and the other condition is met”. In other words they felt even in this time of crises, even when they are to blame, that they still had the RIGHT to dictate to the government exactly in what forms legislation to help the situation should take. And we complain about the heads of the Automakers being arrogant. They are, but clearly they aren’t the only industry in this nation that thinks they OWN a Government supposedly subservient to the PEOPLE.
Do you see how instructive it is? The Government and Business are not two separate entities as we sometimes erroneously assume. They are one in the same. Why else would Citigroup be able to dictate to the legislature the direction that policy must go in and must not go in whereas the people have no such powers? Surely it should be the other way around. The people by virtue of their representatives would have the power to dictate to banking institutions like Citigroup how things are going to be.
But it doesn’t work that way. Business Interests and Government Interests. They are intrinsically linked. They feed into one another. They are by and large the very same people in the one as in the other. But until we separate or at least weaken that link the people will always get the short end of the stick.
Comments (7)
Yeah.. I suspected somethin like this would happen. and I completely agree with you. Grrr… Our government needs a fucking makeover. A HUGE one.
Yes.
But you have to realize that it’s never any good to avert disaster– one needs a disaster to happen so you can save people. That’s a sure fire strategy.
Like, say (for example) someone in government or the military or finance had completely averted the 9/11 tragedy. They could stand up and say, “We believe something terrible would have happened if we hadn’t stopped these dudes.” And we would all yawn, roll over and go back to sleep. We would not remember them.
Even the Bay of Pigs crisis, which has all the historical marks of a huge national crisis (it could have wiped out Florida and much of the South with a nuclear blast), is little remembered (or not remembered with much emotion) because JFK won the chicken fight. He averted the disaster, so we move on.
Lincoln saw this day coming, when monied interests would undermine our Republican form of government:
“I see in the near future a crisis approaching that unnerves
me and causes me to tremble for the safety of my country. . . .
corporations have been enthroned and an era of corruption
in high places will follow, and the money power of the country
will endeavor to prolong its reign by working upon the prejudices
of the people until all wealth is aggregated in a few hands
and the Republic is destroyed.”
— U.S. President Abraham Lincoln, Nov. 21, 1864
(letter to Col. William F. Elkins)
Ref: The Lincoln Encyclopedia, Archer H. Shaw (Macmillan, 1950, NY)
@runaheadofme - you make very good points. It’s kinda sad though. I guess I can only hope that this disaster will be enough to force us to change our ways rather than us having to wait for the next even bigger one.
You’re right, and this slump in the economy and loss of faith in the underlying principles of market fundamentalism are a once-in-a-lifetime opportunity to work for real change. We really need to be creative and active in our efforts for change. We need to just chuck the old paradigms and come up with something truly new, because if the good times come back (even momentarily), then no one will listen and we’ll be under all the same old thumbs again.
Scott Adams (creator of Dilbert) makes some good points that if we “recover” from this, without changing our ways, it will be just another bubble, with the same inevitable results. A lot of the “prosperity” that they sell us on is a manipulation of reality, an unstable system that will eventually fail. A recent story on the French revoking their “mandatory no shopping day” on Sundays said that many opposed it because they appreciated their leisure time. But they were heard to say that the “British and Americans would probably like it because they would like to make more money, but no on will make the French work on Sunday.” And another man, a British professor of economics, said that the collapse of these hedge funds and the failure of the newfangled financial instruments was good for our health as a society, because “this capitalism is an exhausting thing and it tends to make one very tired.” So hopefully we will not repeat the same mistakes and will just appreciate a slower pace of life.
Scott Adams link: Sign of the End Time
This is kind of interesting as much as I feel bad for these home buyers I was not one of them so it doesn’t affect me that much other than killing our econ.
So to be honest I’m not happy or sad either way, I just want what’s best to bring us out of the slump because it really sucks to have my stock accounts be half of what they use to be and pinching my pennies. ^_^
Though it’s nice that you write about this so I’m at least I’m somewhat up to date what is going on. ^_^
@raindrops23 - I’m not one of them either so it doesn’t directly effect me either. I don’t own a house and probably won’t ever buy one.
Still if the crises deepens it will start to effect me indirectly I am sure. Especially if people I know and care about lose their jobs or have a hard time finding jobs or if wages stop going up and stagnate. Also opportunities to branch out and look for other different jobs in my field will reduce as people will tend to “hunker” down and not switch jobs that often. Upward mobility will similarly slow since companies won’t want to pay as much for promotions and high ranking people will be afraid to retire because their 401K’s aren’t sufficient to support their retirement. Competition for the few jobs out there will be stronger so doing a good job on your own job will be all that more important. And so on and so forth…
Generally recessions just suck all around. So like you I just want what’s best for the economy so things can turn out better.
I’m particularly worried about ensuring that my parents have enough money to retire which is looking dangerously unlikely in this economy.
Anyways, I’ll always keep writing and keeping you informed ^_^
I also find that annoying. One my co-workers was about to retire and when the stock market crashed he totally lost half his money which was half a million dollar and maybe more, he said if he worked for 10 years he couldn’t make up that money. I felt really bad for him also but yet again doesn’t really affect me… maybe i’m just a selfish person. ^_^
another interesting thing my mother has a lot of money in stock but mostly in KFC since she’s a manager there and gets some stock opintions, for some strange reason that hasn’t gone down at all. so my parents are okay even if they aren’t we are asian and eventually they will just live with me if it came down to it. ^_^
i told one of my co-workers about KFC stock and he said “sins” never go down. the tabacco stocks are all the same also, along with fast food and all those other things that are supposely bad for us. it’s actually kind of smart to put your money in that. *shrugs*