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Monday, October 27, 2008


How you know the bailout had nothing to do with "socialism"

The bailout was sold to the public as a means to "unfreeze the credit market," although since only the tiniest fraction of the public even knows what that means, mostly what you heard about on TV was how this was all about jobs. Companies routinely borrow money to make payroll, we were told (they do? funny I never heard a single statistic backing up that claim, by the way), and so we have to give money to the banks so they can lend it to companies or jobs will be lost.

So what is the bailout money actually going for? Read it and weep:

Bankers might instead use the money to buy other banks, pay dividends, give employees a raise and executives a bonus, or just sit on it.
That "might" might lead you to believe this is all hypothetical, but it most assuredly is not:
PNC Financial Services Group Inc. was approved to receive $7.7 billion [of the "bailout" money] in return for company stock. At the same time, PNC said it was acquiring National City Corp. for $5.58 billion.
And you remember how proud the Democrats were that they rewrote the initial blank check 3-page bill into a 70-page bill filled with details? It appears they left a few things out:
Other planned uses of the bailout money have lawmakers protesting, although it is only fair to note there is nothing in the law that they just wrote to prevent those uses.
"Bailout"? "Giveaway" would have been a better title for the bill.

And, just to make your blood boil a little more:

Five straight quarters of losses and a 70 percent slide in its stock this year haven't stopped Merrill Lynch & Co. from allocating about $6.7 billion to pay bonuses.
Update: I should have pointed out that that banks buying other banks isn't just an outrageous use of taxpayer's money. It's also a guarantee of losing jobs, precisely the thing we were told the plan was designed to save.

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