The Public Option in Banking

August 6, 2009

How We Can Beat Wall Street at Its Own Game

The Public Option in Banking

By ELLEN BROWN

President Obama has repeated his call for a public option in health care, in order to create some competition for the insurance companies and keep them honest. We the people need to call for a public option in banking, in order to create some competition for the private banks and keep them honest.

In Wall Street’s latest affront to the public trust, the nine mega-banks graced with $125 billion in taxpayer bailout money under the Troubled Asset Relief Program (TARP) were reported last week to be paying out billions of dollars in bonuses to their executives. At least 4,793 bankers and traders received more than $1 million each in bonus payments, although it was one of Wall Street’s worst years on record. After months of investigating banker compensation, New York Attorney General Andrew Cuomo said on July 30, “The repeated explanation from bank executives that bonuses are tied to performance in a manner designed to promote (national economic) growth does not appear to be accurate.”

To say that it was an understatement would be an understatement. The bonuses paid to executives not only were not tied to national economic growth but were not even tied to some reasonable percentage of company profits. In fact they were generally greater than the net income of the banks. Morgan Stanley, for example, had $1.7 billion in earnings and paid $4.475 billion in bonuses. Goldman Sachs had $2.3 billion in earnings and paid $4.8 billion in bonuses. JP Morgan Chase had $5.6 billion in earnings and paid $8.69 billion in bonuses. JP Morgan’s largesse involved showering 1,626 of its favorite execs and traders with bonuses of $1 million or more.

http://www.counterpunch.org/brown08062009.html

If that passes, then maybe other types of consumer loans will be added.

certainly doesn't benefit the people.

http://www.youtube.com/watch?v=2UReMIrcb8E&eurl=http%3A%2F%2Fwww.itulip.com%2F&feature=player_embedded

because the government is not allowed to make money in it's business endeavors.
omfg I would love a gov loan, if you think about it.
the down side is there is N O way to default on it LOL
that aside, I think it would be FAR easier to pay off with no or fewer bullshit fees for farting or whatever.

Seriously, though, commercial banking is a public utility function, and as we can see, there is no good to come of it when these institutions can be aligned for short-term profit at the expense of long-term catastrophe. Let people speculate with their own money, not that of bank depositors'.