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April 06, 2009
Geithner to Banks:Government Decides Your Executive Line-Up
Geithner to Banks: Get Federal Help, Government Decides Your Executive Line-Up
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WASHINGTON
The government may require new faces in executive suites at banks requiring "exceptional assistance" in the future, Treasury Secretary Timothy Geithner said Sunday.
Critics of the Obama administration's move last weekend to force out the chairman of General Motors Corp., Rick Wagoner, as a condition for possible additional federal loans say that strong government intervention contrasts with measures placed on the financial industry in return for billions in infusions.
Geithner denied there was a double standard and put banks on notice that they may need to change leadership teams in exchange for accepting more money in the future.
"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," he told "Face the Nation" on CBS. "And where that requires a change of management of the board, we'll do that."
The treasury chief said that is what has happened at some big institutions that are getting large amounts of government aid. They include the mortgage companies Fannie Mae and Freddie Mac, which were placed into conservatorship by the government last September, and insurer American International Group Inc., the recipient of more than $170 billion in help since last fall.
"We've already seen a substantial number of the largest banks in our country fail or be absorbed by other institutions, no longer existing at independent institutions. And where the government has acted, like in Fannie and Freddie or like in AIG, where we've had to do exceptional things to stabilize them, we have replaced the management and the board," Geithner said.
"And we've done that because we want to make sure that taxpayers' assistance is going to make these companies stronger, make sure there's accountability, make sure it comes with strong conditions. And we'll do that in the future if that is necessary," he added.
"It's a single standard, a single principle. And our obligation to the American people is to do what's necessary to try to bring recovery back on track as quickly as possible."
Asked if chief executives of big banks such as Citibank and Bank of America should worry about their jobs if their companies don't improve their performance, Geithner said the government would not shy from such a restructuring.
"Where that's necessary, where it meets the test, where it's necessary to do what we ... exist to do, which is to make sure that this financial system supports recovery and the banks emerge stronger," Geithner said.
As part of the new administration's overhaul of the $700 billion bailout effort, banking regulators are requiring stress tests for the 19 largest banks to see whether they will need additional support to withstand a more severe downturn than the country is experiencing now.
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Wild Thing's comment........
The most ridiculous part of this mafia scheme is that these banks literally want to GIVE the money back, but Comrade Geithner won’t take it back. He’d rather have the power.
These people are so brazen, and there’s simply nobody to hold them to account. There is NO Constitutional authority for bailouts and corporate handouts, and certainly none for the Fed to take control of any enterprise.
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....Thank you Mark for sending this to me.
Mark
3rd Mar.Div. 1st Battalion 9th Marine Regiment
1/9 Marines aka The Walking Dead
VN 66-67
Posted by Wild Thing at April 6, 2009 06:44 AM
Comments
Obama and his handlers certainly did not waste the banking crisis. They used the crisis and our future tax money to buy control of private banks. The government doesn't just oversee or regulate the banks anymore. The government controls the banking indusry.
Posted by: TomR at April 6, 2009 01:20 PM
The beginning of the end ? In any take over the press is the first thing to go, but since the press in his pocket, the banks are next. Control the press and the money and you run the country anyway you want.
Prime reason the Founding Fathers did NOT want the government involved in the private sector.
Posted by: Mark at April 6, 2009 07:06 PM
Tom,thank you, that phrasing is what I was trying to think of, how the government would oversee and regulate, not control.
Posted by: Wild Thing at April 6, 2009 07:41 PM
Mark, yes see that6 is what they have done. Just like you said, control the press and the money.
I want our Founding Fathers to come back, walk into the Oval office and turn the tables upside down like Jesus did in the Bible. The kick these dems out for good, everyone of them.
Posted by: Wild Thing at April 6, 2009 07:47 PM
