Orwell Invoked in Financial Reform

Below  are selections from a piece written by Robert L. Borosage for Huffington Post but re-posted by Michael Leon at Veterans Today. Borosage accuses Republican senators of being Orwellian and explains why he thinks the accusation fits.  I’ve put asterisks where I removed text.

Senate Republicans have perfected the art of saying no. But in blocking a debate on financial reform, they have begun to imitate Goldman Sachs traders, selling positions that they are betting against.

* * *

The Dodd bill calls for the banks to ante up a $50 billion fund. This would be used by the FDIC if it were forced to take over a failing big financial institution.

* * *

Now Republicans have done us a favor. They’ve published a Republican alternative on financial reform, laying out the differences. Not surprisingly, much of it tracks the Dodd Bill, since a good portion of that was forged in bipartisan negotiations.

* * *

For all of Republican warnings about the FDIC’s incompetence, the Republican alternative essentially calls for the same procedure. The FDIC would be named receiver. It would liquidate the assets, or transfer them to a “bridge bank” and sell them. It would fire the management; operate the bank if necessary while dispersing its assets. Shareholders would be wiped out; creditors would take a hit. But in some cases, the FDIC will have to take “emergency action to stabilize” the bank, “issuing guarantees, purchasing assets, and advancing funds to creditors.” The FDIC would seek to recoup this money from creditors and shareholders in the ensuing liquidation.

Where would that initial money come from? Here’s where Republicans pay tribute to George Orwell. The money won’t come from a fund paid for by the banks. Republicans denounce that as leading to “taxpayer funded bailouts.” No, the money would come from, well, taxpayers, and thereby save us from taxpayer funded bailouts. War is peace. Black is White. Are Republicans a great party or what?

* * *

The second major Republican initiative is to protect the banks from consumer protection. No really. Instead of an independent agency which the House called for, or a strong agency lodged in the Fed as the Dodd bill calls for, Republicans would create a “Council for Consumer Financial Protection” to promulgate rules for consumer financial protection.

*  * *

Whether Borosage’s analysis is correct or not, the idea from the Republicans (for whom Frank Luntz created the “big government takeover” slogan for this fashion, I mean political, season) concerning yet another banking oversight council amuses. And the synergy between Huffington Post and Veterans Today is one I hadn’t expected.


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