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.
At one time we had financial institutions regulated to kept them from having "casino nights" on wall street. Lets be clear though, no matter how many time we the Republicans would like to say it ain't so to make it seem true, Republicans were in charge and turning a blind eye to the lack of oversight that was taking place. shelby says we should let one of the 'largest banks in the world" fail? I wonder if it's because Citi didn't donate enough to the GOP last year? The same reason that the GOP now cowers to Rush who directs his supporters to ONLY fund candidates of his choice.
In the past election EVERYONE, Repub & Dems both were telling their constituents that they would in so many words "BRING HOME THE BACON". We need a new thinking about why we put people in office. There is no I in "We the People.
I wish the Republicans would stop mouthing off. They should remember they were the ones who got us into this mess. The people spoke and wanted Obama to lead us. Now all they do is keep harping he's going to fast, he should stay forcused. These are the same folks when we had allies and went into Aghanistan who stopped focusing on Afgjhanistan and dragged us into Iraq. What if we had been allowed to finish our mission in Afghanistan. We'd probably have Bin Ladden and have a stable Afghanistan. I suggest the people that caused our economy to crash put a sock in their mouths and let the smartest President we have ever had lead us out of this mess as he sees fit.
Bailing out the banks and bailing out the automakers are two different issues. The automakers provide a product and support millions of jobs. Banks have no product, they are leeches with excessive fees for anything you do or try to do. Yes they provide loans, but they don't produce money, just more false wealth that caused the dot.com and real estate bubbles and collapses. For all of you who harp on Obama, don't forget your president savant who gave $350b no strings attached, that no one can seem to account for. It's time to look for a solution, blame can come later.
The Rebups will stop at nothing to help this administration fail! I hope people wake up because it is going to be a bumpy ride for the next 4 years. As far as capitalism rewarding the good, give me a break! It rewards the top when it should reward the workers! The workers should be making the most money because WE are doing the labor! Why should a CEO make a million dollars? If it wasn't for the workers they would have nothing!!! Americans have nothing new to offer, we make nothing, we are a service industry only, and if the Republicans have their way the only ones left to serve will be the Million dollar CEO's why the rest are starving as we look for jobs. This is capitalism!! The Republicans today remind me of the Bolsheveks and we all know what happened to them.
I bet he wouldnt let the moonshiners in his state fail.
So do the conservatives who say "Let the banks fail" then continue to scream about the declining Dow index understand that these are mutually exclusive objectives? Bankruptcy of AIG and/or another large bank would send the market into a freefall. If you OK with a stock market nose dive to 2000-3000, then we can respectfully agree to disagree. If you want to protect taxpayers and your 401 (k) without a clear substantitive solution then that just sums up the tax-cutting, high spending, "have your cake and eat it too" matra of the Republican party.
On paper, I agree with him. I would absolutely LOVE to let them take a tumble, however, I am trying to be pragmatic. In a pure capitalistic society, institutions who made bad decisions should fall by the wayside. We do not live in a pure capitalistic society as pure capitalism counts on everyone playing by the rules and having scruples. We have to put regulations on these institutions because they can not be trusted to govern themselves. Deregulation allowed these monsters to get too big to fail.
Now everyone is complaining about socialism due to regulations that will definitely be coming down the pike. What choice do we have when people who should know better willfully made bad decisions based on greed. I say too big to fail should now be too big to exist
They all should either sink or swim on their own. NO MORE $$$.
SO THE REPUBLICANS ARE FOR KILLING JOBS NOW??
IF YOU LET A LARGE BANK FAIL, YOU HAVE NO IDEA HOW MUCH THE RIPPLES OF THAT ACTION WILL WREAK HAVOC ON THE ECONOMY. THIS IS THE REASON WHY THEY ARE NOT LETTING THEM FAIL.
PROPPING THEM UP MAY BE DISTASTEFUL, BUT THE ALTERNATIVE IS EVEN WORSE.
Yes, Let some of them fail. But I am concerned we are putting a lot of funding into this enconomic development, when as soon as we get things back on track and business is as usual congress and the house will start selling it off to corporate and special interest groups for an election. So we are only providing them with a bargining chip.
SAD Day in AMERICA
It is amazing, where were those republicans when Bush was throwing money around to the banks? I did not hear anything like the constant quarrel I am hearing now. Repubs, you lost, it is time to shut up.
The recovery will to hold by the end of this year, until then, the dow as an economic indicator will go down to between 2500 to 3000, and after that a robust economic recovery will begin.
So long as Toyota is building a plant in their state they'd love for Ford & GM to close too.
So long as their state is okay they don't care. So long as their welfare state can pay $1 in taxes and get $1.60 back they don't care.
Typical small minded Repub chanting, so long as it doesn't effect them they keep thier heads buried in the mud only coming up to yell NO! to every forward action the Dems try to do for the benefit of all.
WE can use common sense. Giving money to banks is not going to solve the problem. People need jobs....
These people have no idea what they are talking about. It's actually scary that they are in leadership positions. Letting Lehman fail was what started this mess–they have absolutely no credibility.
Unemployment numbers are brutal. The Republican solution is let banks fail, let the auto industry fail and let the small businesses that support them fail which of courses will put millions of more people out of work todefault on their mortages and their credit cards. Also small investors who have shares in these companies will get crushed as well. As ugly as it may feel to prop up those greedy and mismanaged companies, their are no better alternatives at this time. Thankfully McCain isn't President and the republicans are following te fat one into the wilderness.
I agree let some banks fail, but where were the GOP when all this was going on and they didn't seem to mind when banks were doing all these bad loans.
I say it's time to nationalize the banking system for awhile, the banks can't seem to manage themselves anyway.
As should so many of these homes with bad mortgages. Propping up these mortgages will only continue to haunt the real estate industry. Let foreclosures flood the market. Let new buyers purchase at a price they can afford to finance, get some good mortgages in the system. Why should the government be haunted by this bad debt.
If the big banks can't manage the billions they already had, what makes us think they can manage the paltry trillions of dollars the government is giving them? Obviously, AIG can't since they are back at the till for the 3rd time. It would be interesting to see how much they donated to either party during the campaign. How much did they donate to the inauguration parties? How much did they waaste on their CEO's who obviously are only doing the job for the money, not their knowledge?
Of course the GOP wants them to fail – on Obama's watch, so they can feed it up to him in four years!
You might be surprised to see what the banks would do if we tell them "No more money" you are on your own. No one wants to lose their job and I can bet you that someone with reorganization that you would find these banks making it. They are like children, if you keep giving them things they will never know what it is to work for it. It is so obvious that the money that has been given they didn't manage well, played around. Now it is what we should call "Tough Love" and if they fail, dont you think someone will come in and buy it out and make a go of it. That has always been the American way!
Senator Shelby's answer to everything is let them fail, how negative is that... Let everyone fail who is not apart of his republican group. Failure is easy it takes no brain power, which is why Senator Shelby is always in favor of it, lack of ideas for success.
And the fourth bailout for AIG in six months, with some of taxpayers dollars going to foreign financial institutions.
Instead of nationalizing banks, why not let Government directly start lending to whomever needs it rather than give it to banks to sit on?
Let capitalism play out...if these banks were destined to succeed then they will survive in spite of the toxic loans and the new government lending entity.
If they fail, too bad...they have no place in our capitalism.
We "the people" win either way because in the end we get our loans from reliable lenders that were fittest to survive. Government stimulus does not need banks or any middle person...lend us our money directly for God's sake!
I agree. Let them fail!
17 banks have failed so far this year. At that pace 100 banks will fail this year. Is that not enough for you Senator?