Obama’s applause line during his recent swing through recession-ravaged Ohio is a pledge to get “our money back” from the banks.
Really? Is that what we want? A few months ago the complaint was that the banks refused to lend the money we gave them! And now we want it back??
One can only guess at the chaos now unleashed in the west wing, but this takes the cake. The whole point of helping boost the banks’ balance sheet was not to pay the government back but to lend to the private sector and consumers to jump start job creation.
Has Obama never heard of the multiplier effect of bank lending? Every dollar into a bank can create 10 in new loans as it works its way through the system. Since job creation has been anemic, why are we now saying we want to take money back before it has been put to work?
If we had, of course, really wanted to solve the problem of over paid and timid bankers we would have taken the suggestion of Nobelist Joe Stiglitz and nationalized the banks.
But that is a constructive left wing approach not the kind of senseless populism that now seems to have taken hold in D.C.