Could there be trouble brewing for the leadership at America’s failbanks if they need to fall back yet again on the government teat? Tim Geithner hit “Meet the Press” this morning and said that bank CEOs should note the boot-marks on Wagoner’s ass carefully:
Treasury Secretary Timothy Geithner said the federal government might remove top bank executives or board members if “exceptional” assistance is required to keep the banks operating in the future.
“When in the future — or I would say, if in the future — banks need exceptional assistance in order to get through this, then we’ll make sure that assistance comes with conditions, not just to protect the taxpayer, but to make sure this is the kind of restructuring necessary for them to emerge stronger,” Mr. Geithner said on CBS’s “Face the Nation.” “Where that requires a change of management and the board, we will do that.”
Haha! If! (Our money is, of course, on when.) And somewhere, I am sure, Larry Kudlow is in the middle of preparing a lonely defense of Bandit and Kennay, lamenting that the best path to free-market capitalism is to give the banks massive wads of cash without mandating any leadership changes. Geithner also went on to indicate that he wasn’t done yet and that he and Obama may ask for yet another stimulus, so if you are of the goldbug mindset, tuck another bar or two under the bed.
(h/t to reader Paige L. for the image, which I could not wait to use!)
Max // Apr 5, 2009 at 1:56 pm
I haven’t heard Kudlow say or imply the words you are putting in the mouth of your man of straw.
alyx // Apr 5, 2009 at 2:10 pm
You’ve never heard Kudlow suggest the government goes too far by insisting on a leadership change at a bailed-out company? Here’s one example where he nods along with Corker’s assertion that Wagoner’s removal should “send a chill through all Americans who believe in free enterprise”:
http://article.nationalreview.com/print/?q=ZWE0MzM5ZmZlMjA2MjU4YTliOGYxNjViN2VkMDVmNzI=
My beef with Kudlow on this point, for what it’s worth, is that free enterprise died the second these institutions took government money. Expressing shock, or disgust, that government is then going to meddle with the affairs of the institution is pointless.
Jason // Apr 5, 2009 at 9:17 pm
No, I think Larry is absolutely right. Giving a company more money than it is actually worth without asking anything in return is sound – nay, moral – fiscal policy.
Sofie // Apr 6, 2009 at 12:01 pm
My money is on Bandit as the next one with a sizable boot print on his bespoke suit.