The news this morning would be amusing if it weren’t so sad.
The Obama administration is undergoing a battle between its own good instincts with those of its Treasury Secretary.
Away from Treasury, on the side of intelligence, new policies, a clean break from the Paulson/Bush plans — I believe during the campaign, it was called CHANGE — and inevitability, are prepackaged bankruptcies, clean balance sheets, and a fresh start. This is reflected in the Fed exploration of $40 billion in bankruptcy funding for GM.
On the side of more of the same, bad decision making, regulatory capture, worshiping sacred cows, and a hard-to-understand goal of saving the banks rather than the financial system, is the utterly absurd proposal to somehow spend 10X the market cap of Citigroup for a 40% stake in the apparently insolvent firm.
The fact that this discussion about the bankruptcy of GM and Chrysler and the insolvency of CITI and BofA is not surprising is the biggest surprise of all. Just months ago, the economy was sound according to our lying leaders. Just months ago, the banking system was strong according to those same leaders. Just months ago GM and Chrysler had survival plans: they were going to sell 10 million vehicles this year. They will be lucky to sell 2 million.
Peacenik wants to know the following answers: Will those who know the truth and have the facts start telling the truth? Would someone start cataloguing the lies we've been told? Is the Canadian banking system solvent? Are Canadian pension plans solvent? What happens to GM and Air Canada and countless other pensioners if their pensions go poof? It is time for citizens to be told the truth. It is time for citizens to demand the truth.
