March 9th, 2009
04:37 AM ET
9 years ago

Some banks should be allowed to fail, say two top Republicans

'We bury the small banks -- we've got to bury some big ones,' said Shelby Sunday.

'We bury the small banks - we've got to bury some big ones,' said Shelby Sunday.

WASHINGTON (CNN) - Two top Senate Republicans said Sunday that banks shouldn't be able to count on any more bailout money - and that the federal government should let some of them fail rather than distribute further funds to keep them afloat.

"Close them down, get them out of business. If they're dead, they ought to be buried," Sen. Richard Shelby, the Ranking Republican on the banking committee, told ABC's This Week. "We bury the small banks - we've got to bury some big ones, and send a strong message to the market." He did not mention any banks by name, although he responded to a question about Citigroup by noting that "Citi's always been a problem child."

Former GOP presidential candidate John McCain told Fox News Sunday that he did not think President Obama "made the hard decision, and that is to let these banks fail." He did not call for nationalization of troubled financial institutions, which many Republicans oppose, but said their assets should be sold. "Unfortunately, the shareholders and others will take a beating," he said.

Filed under: John McCain • Richard Shelby
soundoff (417 Responses)
  1. Casey | Sebastopol, CA

    Isn't Shelby the same guy who is fighting to keep his earmarks alive in the bill to fund Congress? These Republicans are all over the place... against earmarks when it suits their political agenda; for them to stay elected... gotta bail out the banks, nah... let'em fail.

    Get some sort of original, consistent message and maybe, just maybe, someone will care to listen.

    March 8, 2009 02:57 pm at 2:57 pm |
  2. Proud American

    I agree, and they should start with the ones with Republicans money deposited in them. Then move to to the bank in the U.S. congress. Morons

    March 8, 2009 02:57 pm at 2:57 pm |
  3. The Last Patriot

    What? Let an under-performing institution fail? But that is not the Obama way!

    We must borrow more money, bankrupt our children, ruin the US economy, tax our productive citizens, and god willing we will prop up these campaign-friendly institutions for at least another 3 months!

    March 8, 2009 02:59 pm at 2:59 pm |
  4. s

    During 'Nam the Repubs mantra was "Kill a commie for Christ!" Now it's "Kill a bank for capitalism." ... and let America suffer the economic consequences?

    March 8, 2009 03:01 pm at 3:01 pm |
  5. Bill

    This is the first thing anyone in he Republican party has said that makes sense in a very long time. To bad they didn't stand up for these principles a year ago. We could have saved 700 billion dollars and be on our way out of the recession.

    March 8, 2009 03:01 pm at 3:01 pm |
  6. James

    As a Democrat I love reading these statements. I am sure that the banks that these Republicans want to fail are not in their districts, but they are in someone's district. Comments like this are the reason that the Republican party is going to be more decimated in the 2010 election. They need a true leader who can shut these guys up, and maybe then the country can start to recover. As long as the Republicans keep coming up with this stuff, their party is doomed. Lets say, for example, that Citi failed. This would lead to several things, first being that the FDIC has to absorb the losses of the bank, or find a suitable buyer (yeah right, a suitable buyer for the largest bank in the world). Second, the loans and lending of Citi would be frozen, like I said earlier, you are not going to be able to find a suitable replacement for the largest bank in the world, especially with the other ones in financial straits. This would lead to a loss of the confidence in the banking system, and we have all seen what happens to institutions when confidence is lost. Prop up the banks, nationalize them, do whatever we have to do, but get this country back on track FAST and get credit moving again. Stop grandstanding about failure, and start talking about how we are going to save things!!

    March 8, 2009 03:03 pm at 3:03 pm |
  7. norma wilkinson

    Regarding letting banks fail, the latest from the Republican partty. Why is it that they can not come up with anything helpful, always negative and complain that the Democrats are all wrong.If. they have a better plan, then let's hear it NOW.

    March 8, 2009 03:09 pm at 3:09 pm |
  8. Lilly Rose

    I certainly hope your money is in some of them. Now THAT would be fair, really fair. Even if you don't care for overpaid bankers, what about all the little people who work at banks. Oh, that's right. The Repiglicans don't care about the little people.

    March 8, 2009 03:15 pm at 3:15 pm |
  9. John G

    If a bank is already failing on it's own then why should tax payers pay to prop the bank up?

    March 8, 2009 03:16 pm at 3:16 pm |
  10. Brad, California

    The complicity of the Selby's, Dodd's, McCain's and more in our nation's capitol created the bulk of the problems that our nation is experiencing today – why would anyone trust those who have made a career of selling our country and workforce out for foreign money and unrealistic profits and growth through through lack of regulation and oversight?

    You're trying to turn the cause of the problem into the solution, and the solution is for the public to replace the white haired old men with honest Americans.

    March 8, 2009 03:20 pm at 3:20 pm |
  11. Mel of Alexandria, Virginia

    Except the banks in which he has his money and other interests.

    March 8, 2009 03:21 pm at 3:21 pm |
  12. Let the banks fail

    you know i agree with this G.O.P senator. We should't keep givjng money to some banks considering the fact that they go on a spending spree anyway. Hey the economy will get worse but hey why not???

    March 8, 2009 03:23 pm at 3:23 pm |
  13. Max

    That's the way it should be. Failing industries fail, and from their ashes are new entrepreneurs that fill the void more efficiently. It's been a long time since it happened last, but it sounds like Republicans are finally starting to talk a little bit of sense.

    March 8, 2009 03:26 pm at 3:26 pm |
  14. Tony in Maine

    Insanity is doing the same thing over and over, expecting a different outcome each time. I think we tried letting the market determine who lived and who died once before. The same crew tried the spending freeze now being touted by the tiny-brained. It led to a cataclysmic event they call the Great Depression.

    Why are there Republicans?

    March 8, 2009 03:35 pm at 3:35 pm |

    go to a free fall and see which banks fail and bail-out the ones

    still standing..why?...because they were managing their affairs as

    best as they could under the current condtions...thinking of the

    people and not themselves......Can't restock bad banks like a

    grocery store full of candy........SOMEDODY BETTER THIN....!

    March 8, 2009 03:35 pm at 3:35 pm |
  16. Irishny

    Why should tax payers be forced to bail out incompetency?

    Let them fail.It might hurt for a while,but in the long run,its for the best.

    They wont be so quick to give loans so easily next time

    March 8, 2009 03:37 pm at 3:37 pm |
  17. FreeNLovIt

    Extinction is the best remedy for some banks. God help us or being greedy!!

    March 8, 2009 03:43 pm at 3:43 pm |
  18. Mark, B'ham., Al.

    To the left, if you think John McCain got rich by serving in the Navy you are as lost as most Americans. The money is from his wife's family brewery and he does not have access to it like the average husband does, like John Kerry who used his wifes money for his run in 04. We taxpayers have put enough money in the banks that they should have recovered by now unless they are hiding more than they will admit! Maybe we should let them fail and put a bunch of executives, accountants, and managers in jail.

    March 8, 2009 03:44 pm at 3:44 pm |
  19. Griff............... on The Truth...

    AIG? Too many cracks in a Wall. But what happens if the Dam burst.
    How many more little dams go with it?

    March 8, 2009 03:45 pm at 3:45 pm |
  20. Gary

    Of course some banks should fail, but most should be propped up with strick rules (like exec pay) and supervision. What ever happened to the notion of helping home owners and stabilizing the credit markets????? Obama is skipping that whole step and going for reckless Democrat spending, huge deficit borrowing and puting our entire economic viability in jeoparady with no plan for banking or credit at all.....Fire Gietner! Hire Robert Rubin! Cut out all earmarks, reduce spending to the same level as last year. And for god sakes go back and reverse that so-called "stimulus" plan that was nothing more than wasting taxpayer money to pay for Nancy Pelosi and Harry Reid's pork projects. Lets get some fiscal responsiblity for once.

    March 8, 2009 03:50 pm at 3:50 pm |
  21. spring forward

    The republicans RUINED our banking system, yes because of the way the republicans and the last administration handled our economy, it is time to let them FAIL, BECAUSE THEY ALREADY HAVE.

    March 8, 2009 03:51 pm at 3:51 pm |
  22. Larry

    Through all the years in our history,30 to 40 banks fail a year,the government has never bailed them out -why now ???

    March 8, 2009 03:52 pm at 3:52 pm |
  23. Earl

    Yeh, there are some banks that should be allowed to fail. But what about those CEO's that left Lieghman brothers with millions of dollars, left thousands of people unemployeed and are now opening refinance institutions to manage the bail out package and rip us off on the other end. If the republicans and democrats were interested in saving main street, they should run these guys out of the country or throw them in jail. These CEO's are like bad doctors and lawyers, the republicans are always crying about, they should not be allowed to practice business in the US, period.

    March 8, 2009 03:53 pm at 3:53 pm |
  24. Tonya

    I never thought I'd say this but I AGREE with the Republicans!!! Let them go...If they can't survive on their own, too bad! If you open a store and your store fails to profit and goes out of business because of bad business decisions or poor sales, tough luck, that's the cost of doing business...Why should these banks be any different. I feel the same way about the automobile makers who are getting tons of money from the gov't to fix their problems. It's not fair. Small business owners aren't getting rescued why should these big companies catch a break!

    March 8, 2009 03:55 pm at 3:55 pm |
  25. Marty, FL

    Gee, these Republicans are actually starting to agree with President Obama, who already recognized some banks may not make it. Of course, the president does not use their misguided terms as "dead, buried, and beating." That seems to show a certain lack of statemanship from these senators IMHO.

    March 8, 2009 03:56 pm at 3:56 pm |
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