|Richard Shelby proved that he is far too crazy to be in the United States Senate, when this morning on "This Week," he suggested a surprising fix to the banking crisis: close down Citigroup and other major banks. Writes George Stephanopoulos:
Sen. Richard Shelby, R-Ala., the top Republican on the Senate Banking Committee, said today on "This Week" that the government should let trouble banks fail.Shelby didn't explain, nor was he asked, by the way, how pulling a Lehman Brothers on potentially dozens of megabanks would inspire investors to re-enter the markets, nor did he explain the particular free market principle behind having the federal government come in with the padlocks and shut down a private bank. George did ask Shelby if he had a particular hit list in mind:
"I don't want to nationalize them, I think we need to close them," Shelby told me this morning. "Close them down, get them out of business. If they're dead, they ought to be buried," he said. "We bury the small banks; we've got to bury some big ones and send a strong message to the market. And I believe that people will start investing [again] in banks."
I asked Sen. Shelby if he was referring specifically to Citigroup, the struggling bank that has received about $45 billion in taxpayer money.Shelby (and other Confederate GOPers) had the same prescription for Detroit's Big Three automakers: let them go out of business (the better to boost sales among non-union, Japanese and German firms who prefer the congeniality and relative worker impotency of the south.
"Well whatever. Citi's always been a problem child," said Shelby, who has long opposed giving federal TARP money to struggling banks.
But Thomas Donohue, head of the U.S. Chamber of Commerce, disagreed.
"It's not practical to talk about closing a bank that is integrated throughout the whole global economy," he said. "It is practical to talk about buying some of those assets away from those banks and holding them in an institution that would have both public and private money."
Question: is it responsible, in the middle of a recession, for a United States Senator to suggest killing off major banks, by name? If there is a run on Citi, or a major sell-off, on Monday, would Shelby be to blame?
Labels: bank failures, banking crisis, banks, Citigroup, economic crisis, Republicans, Richard Shelby, Senators, the Bush bailout, the Bush recession, the economy, The South, U.S. automakers, unions