It’s not a chorus.
If you’ve been watching the “debate” over how best to con American voters into giving troubled banks $700 billion for bad loans, you might think it’s a chorus in the financial industry, especially from bank presidents.
You might assume they’re all shouting: GIVE US THE BAILOUT MONEY! NOW!
Not so. At least one banker dissents. John Allison, president of BB&T — with $136 billion in assets and 1500 branches — sent an open letter to Congress protesting the bad economics behind the bailout. He notes that his own company, though affected by the downturn, is in a much stronger position than many of BB&T’s competitors.
Why? Well, his bank did not join the orgy of bad lending, despite the enticement of the Federal Reserve’s easy credit policies and government pressure to give loans to bad-risk borrowers.
So why should the government reward the bad economic conduct of institutions that played along with the bad government policies? Why make it harder for the economy to recover by punishing sound and productive economic conduct with burdensome new government taxes?
Allison thinks the debate has suffered from domination, as he says, by those “financial institutions [that] made very poor decisions.”
Perhaps it’s because politicians have a whole lot more in common with foolish decision-makers than wise ones. . . .
This is Common Sense. I’m Paul Jacob.