The Bailout: Bush’s Final Pillage

The Bailout: Bush’s Final Pillage

by Naomi Klein
October 29th, 2008

[T]he real purpose of the bailout? [T]he Bush version of “partial nationalization” is rigged to turn the U.S. Treasury into a bottomless cash machine for the banks for years to come...because the market will now be banking on the fact that the U.S. government won’t let these particular companies fail.

This tethering of the public interest to private companies is the real purpose of the bailout plan: Paulson is handing all the companies that are admitted to the program—a number potentially in the thousands—an implicit Treasury Department guarantee...the market is being told loud and clear that Washington will not allow the country’s financial institutions to bear the consequences of their behavior, no matter how reckless. This may well be Bush’s most creative innovation: no-risk capitalism.

Meanwhile, every day it becomes clearer that the bailout was sold to the public on false pretenses. Clearly, it was never really about getting loans flowing. It was always about doing what it is doing: turning the state into a giant insurance agency for Wall Street.

This duplicity is a political opportunity. Whoever wins the election on November 4 will have enormous moral authority. It should be used to call for a freeze on the dispersal of bailout funds—not after the inauguration, but right away. All deals should be renegotiated immediately, this time with the public getting the guarantees.

for the details and complete story:

http://www.thenation.com/doc/20081117/klein

http://www.naomiklein.org/articles/2008/10/bailout-bush-s-final-pillage