The story by itself was sad enough. But yesterday’s papers carried a story that made Mr. O’Donnell’s predicament even sadder. And it should make any taxpaying American extremely mad. I would call it an outrage. In a nice piece of investigative reporting, the Associated Press contacted 21 banks that received at least $1 billion in the federal government’s $700 billion financial industry bailout program.
The A.P.’s reporters asked four questions: “How much has been spent? What was it spent on? How much is being held in savings, and what's the plan for the rest? None of the banks provided specific answers.” http://news.yahoo.com/s/ap/20081222/ap_on_go_ca_st_pe/meltdown_secrets
In other words, the country’s largest financial institutions, some of which helped get us in this mess in the first place through the subprime mortgage fiasco, cannot or will not account for billions of dollars in taxpayer money. As anyone who has ever applied for a mortgage or refinancing knows, that type of attitude and conduct would not fly with the bank (except, of course, during the subprime mess). The bank or lending institution wants to know your credit rating, your salary, your tax statements and more. And that’s on loans a lot smaller than $1 billion.
To make matters worse, the A.P. also reported in a separate story that banks receiving bailout money managed to award executives $1.6 billion in salaries, bonuses and other benefits last year. http://news.yahoo.com/s/ap/20081221/ap_on_bi_ge/executive_bailouts
What is there about this picture that the major banks and their leaders don’t get? America is going through the worst recession in decades, the financial system has run amok, Wall St. has imploded, millions of ordinary Americans are out of work and yet the banks won’t say what they’re doing with the government handout and have paid their executives bonuses on top of already extremely high salaries. I would say these executives should go on a retreat (using private, not public money) and reassess their conduct.
And while they’re at it, they should also ask their public relations advisers to provide them with more honest advice. The A.P. quoted many spokespeople as saying that they would have no comment on how the money was spent. One even wanted to speak to reporters anonymously about the issue. Another asked that the reporters not report that he wasn’t going to discuss the use of the bailout money. None offered any specifics about the use of the money. Now I understand that spokespeople have to reflect the will of their organizations. But why couldn’t these folks take a step back and ask their bosses to consider how absurd it looks for companies receiving $1 billion or more in taxpayer money refusing to explain how that money is being spent.
I’m pretty sure that John O’Donnell, the Air Force veteran who has applied for Food Stamps to survive, for one, would like to hear the explanation.