Tuesday, April 7, 2009

Cloward-Piven Strategy: Keep The Banks From Returning The TARP Money, Thus Maintaining A Need For Government Takeover

Stuart Varney, business analyst.

Cloward-Piven Strategy

The communists haven't been in power for even 90 days, and we're seeing Stalin-esque maneuvers already. Cripple the banks, fire the CEO's, create a panic. It's all happening right before our eyes.

This manchurian candidate has passed three times the stimulus spending that his predecessor did. Yet Barry hides behind President Bush's mild 700 billion TARP package from last fall when you hit him between the eyes with the figures.

"Mr President, you have now increased the US debt to 9.7 trillion dollars by designing and signing these stimulus bills."

"But I inherited a 1.3 trillion dollar deficit from my predecessor's TARP package." he returns.

Does that make sense? Let's see: If you inherited credit card debt equaling 20,000 dollars when you got married to your wife, what sane person says it's only right to use those credit cards to rack up 160,000 dollars in more debt? Do the lenders accept that reasoning when they keep calling your house for lack of paymnent?

"Hey, VISA, my wife put that original 20,000 dollars on there. I HAD to increase it eight-fold, so far. By the way: there's more to come."

When you press the genius Harvard grad even further, he smugly says that we will be paying down that monstrous debt [every child being born right now in America is automatically saddled with 20,000 dollars in debt, before Barry pushes even more "stimulus" bills through congress] in a short amount of time because his OMB (office of management and budget) declares that America's GDP growth for the next four years will be at 4.7%.

Do you know what our GDP growth has been, on average, for the last 10 years--while the economy was at its best? 3%.

But now, the brilliant communist Barry claims that our economy will start growing at 4.7% by next year. After he breaks the legs of business, big and small, by regulations and taxation, this ACORN nut--who's NEVER worked a real job in his life--tries to tell working people like us that people will open up new business and bring back the tens of millions of jobs that have been lost in the past two years.

It would be hilarious if it weren't so tragic. Stuart Varney is another person who feels the tragedy coming:

I must be naive. I really thought the administration would welcome the return of bank bailout money. Some $340 million in TARP cash flowed back this week from four small banks in Louisiana, New York, Indiana and California. This isn't much when we routinely talk in trillions, but clearly that money has not been wasted or otherwise sunk down Wall Street's black hole. So why no cheering as the cash comes back?

My answer: The government wants to control the banks, just as it now controls GM and Chrysler, and will surely control the health industry in the not-too-distant future. Keeping them TARP-stuffed is the key to control. And for this intensely political president, mere influence is not enough. The White House wants to tell 'em what to do. Control. Direct. Command.

It is not for nothing that rage has been turned on those wicked financiers. The banks are at the core of the administration's thrust: By managing the money, government can steer the whole economy even more firmly down the left fork in the road.

If the banks are forced to keep TARP cash -- which was often forced on them in the first place -- the Obama team can work its will on the financial system to unprecedented degree. That's what's happening right now.

Here's a true story first reported by my Fox News colleague Andrew Napolitano (with the names and some details obscured to prevent retaliation). Under the Bush team a prominent and profitable bank, under threat of a damaging public audit, was forced to accept less than $1 billion of TARP money. The government insisted on buying a new class of preferred stock which gave it a tiny, minority position. The money flowed to the bank. Arguably, back then, the Bush administration was acting for purely economic reasons. It wanted to recapitalize the banks to halt a financial panic.

Fast forward to today, and that same bank is begging to give the money back. The chairman offers to write a check, now, with interest. He's been sitting on the cash for months and has felt the dead hand of government threatening to run his business and dictate pay scales. He sees the writing on the wall and he wants out. But the Obama team says no, since unlike the smaller banks that gave their TARP money back, this bank is far more prominent. The bank has also been threatened with "adverse" consequences if its chairman persists. That's politics talking, not economics.

Think about it: If Rick Wagoner can be fired and compact cars can be mandated, why can't a bank with a vault full of TARP money be told where to lend? And since politics drives this administration, why can't special loans and terms be offered to favored constituents, favored industries, or even favored regions? Our prosperity has never been based on the political allocation of credit -- until now.

Which brings me to the Pay for Performance Act, just passed by the House. This is an outstanding example of class warfare. I'm an Englishman. We invented class warfare, and I know it when I see it. This legislation allows the administration to dictate pay for anyone working in any company that takes a dime of TARP money. This is a whip with which to thrash the unpopular bankers, a tool to advance the Obama administration's goal of controlling the financial system.

After 35 years in America, I never thought I would see this. I still can't quite believe we will sit by as this crisis is used to hand control of our economy over to government. But here we are, on the brink. Clearly, I have been naive.(source)

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