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

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

[cnn-photo-caption image= caption="'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. Former Republican for Obama, Columbia, TN

    These comments by such idiot Republicans is just further proof of how clueless most Republicans are about the economy.

    March 9, 2009 09:27 am at 9:27 am |
  2. Ron Wittson

    Why do the "red states" want the banks to fail?

    March 9, 2009 09:27 am at 9:27 am |
  3. linet

    For the first time i share the same sentiment. Some of this banks need to reap what they sow. Despite the many bailouts some of them are barely making good decisions to make them stay afloat. While the top CEO's live lavish lifestyles and refurnish their offices at a $1m tab and take their families on vacations on coprorate jets, many of their lower level employees lose jobs. Some banks are so corrupt they are headed by greedy slelfish CEO's who are only concerned about their own welfare. Sad to say but maybe a few bank failures might teach others a lesson or two.

    March 9, 2009 09:27 am at 9:27 am |
  4. Shelby Sucks

    By saying we've got to bury some big banks, in the middle of the worst economic crisis since the great depression, Shelby has disgraced himself and his state. For that, Shelby should resign immediately.

    March 9, 2009 09:28 am at 9:28 am |
  5. Ron Wittson

    Why do the "red states" want the banks to fail?

    March 9, 2009 09:29 am at 9:29 am |
  6. Daryn

    Too big to fail? Nothing is too big to fail and they should be allowed to die off. Yes it will be painful and yes innocent people will be hurt. But bailing out these idiots over and over is only a delaying tactic that is just as painful and also hurts innocent people and, to top it off, will FAIL. These businesses have ALREADY failed, why spend untold billions in prolonging their inevitable and unavoidable collapse. They are not good at what they do, so they should be allowed to die. If we carry their mismanagement and it takes down America, what then? Will any of the other countries decide America is too big to fail? Should America be allowed to collapse because the big three automakers are run by know-nothing caretaker CEOs? Gas was $4 per gallon and they introduced the biggest gas-wasting vehicles ever invented! Do we need to preserve that stupidity? Does anyone really think that car manufacturing in America will disappear if the three big idiots are gone? And haven't these big three already outsourced their labor as much as humanly possible to other countries? Why should America look out for them now?

    March 9, 2009 09:31 am at 9:31 am |
  7. Joe Edwards

    Why is this a hard decision? Let millions of taxpayers absorb the cost of this bank's failure or let a much smaller number of shareholders absorb the cost? There's not even a question here. The shareholders intentionally accepted the risk by buying the stock. This senator is one of only a very few who are making any sense nowadays.

    March 9, 2009 09:32 am at 9:32 am |
  8. dennis

    they are stealing our money get rid of them.......

    March 9, 2009 09:32 am at 9:32 am |
  9. carlo

    For the Hallelujah chorus on here praising Shelby and Pop McCain's suggestion-who do you think will lose the most if they are allowed to go bankrupt?

    We will. Someone has to absorb those losses. The CEO's are set for life. We will pay for their bankruptcy. BTW, do you all know that we can't even file some forms of bankruptcy if we make more than a state's median income? So, in essence, you are saying that banks should get a fresh start, but we hold their debts for them and pay them?

    March 9, 2009 09:35 am at 9:35 am |
  10. cedgar

    Why do we think that letting some companies go down will make our
    country totally tank?
    So what all the supporters of the bailouts are saying:These banks and
    insurance and auto companies are the end all of our economy?
    Well if that is true we are totally in the dump period!
    My self I find that hard to believe!
    I think these companies are pulling down stronger companies!
    If there is a bad apple in a basket do you throw out the whole basket?
    What we seem to be doing is letting the bad apple rot in the basket and
    make the good apples rot with them.

    March 9, 2009 09:35 am at 9:35 am |
  11. obama-mama

    I don't know but it's highway robbery the money that is going to these banks and auto companies. Give the taxpayers the money and they will put it back into the economy. The banks and auto companies still making it hard for people to purchase and borrow money so why give it to them.

    March 9, 2009 09:37 am at 9:37 am |
  12. Tomas E

    I hope the banks that these top GOP senators use fail and see if they like that! How can anyone say that? Sometimes I wonder if anyone has a brain in Washington.

    March 9, 2009 09:38 am at 9:38 am |
  13. Kathy S. Cloughn

    He has it the opposite: we must save the banks now but never again allow a bank to become so large that it affects the whole economy. After this crisis is over the banks should be split into its various services so that it can never again have the impact that it has had on this economy.

    For all of you who are crying about privatizing government services look at the banks, Enron, MCI WorldCom etc. We have been romanticizing the virtues of private industry and need to get back to the real world!

    March 9, 2009 09:40 am at 9:40 am |
  14. TRUTH

    The crazy liberals are out in numbers! This senator is absolutely correct. Banks that ran themselves into the ground because of poor lending habits and greedy presidents should not be bailed out by we, the taxpayers. The Liberals have made it impossible for anyone in our society to fail, as though it were a bad thing. It is not. There are winners and there are losers. Liberals think the answer is to just keep bailing out industries and throwing more money at problems. How has that worked for GM? Republicans stated that GM should declare bankruptcy in order to restructure. The Democrats decided to throw 15 billion dollars at them instead, and now GM will have to declare bankruptcy anyways. LIBERALS are ruining AMERICA!!!!

    March 9, 2009 09:40 am at 9:40 am |
  15. To : 'george bush is evil' accomplishes nothing

    it accomplishes a lot

    he inflicted 8 years of pain upon this country

    he brought the U.S. lower in the world's eyes

    he allowed torture under the U.S. name

    he did not follow up and allowed a CIA operative to be named

    he labeled anything contrary to what he said as 'unpatriotic'


    I could write on and on, he was so wrong in so many ways that to explain it would take a lot of typing and I think you well know what he did and was doing was wrong, unwarranted wiretaping of U.S. citizens, not connecting the dots on 9/11 despite warnings on his desk, taking us into two wars – the Iraq based on blatant lies put forward by himself from his own mouth

    But you subscribe to the republican do what ever we can to get elected philosophy that Rove etc subscribe to, and are the reason we are in the middle of this economic problem as well as so many other problems

    March 9, 2009 09:45 am at 9:45 am |
  16. Tyran

    Obama's been President for over a month now. Bush was President for eight years. I think we can give Obama a little time given what we tolerated from Bush. As for these Republicans, they sure talk a lot about failure these days, given the fact that it was mostly THEIR political policies and ideologies that got us into this mess. They seem to underestimate what would happen if we just let the major banks fail, along with the homeowner, while not investing in our infrastructure, education, healthcare, and energy. Basically the GOP leadership just want us to sit and just let things fall. Easy to say if you're a rich man (like most of them), but if you're like most of the nation, we face sure anarchy, lawlessness, extreme poverty and even death if things are just allowed to fail. GOP please stop political posturing and think about your countrymen.

    March 9, 2009 09:46 am at 9:46 am |
  17. Roosevelt

    If it wasn't so tragic it would be funny, but it's easy for someone that has a steady job, 700+ FICO score, and making a decent living to say just let them fail. It's not your job on the line. If that were the case,, I'm sure the sentiment would be different. For those that are being affected by others decisions are the ones we need to think about before we just "let them fail." I'm truly a capitalist at heart and believe in the survival of the fittest but these times are different and that philosophy will affect so many that had absolutely zero in the making of this mess that we are in. I could not, in good conscious, allow a bank to fail knowing that the worst case scenario could happen as a result of it. People, think carefully about what you would do as it could be your steady job, 700+ FICO score, and good paying job on the line.

    March 9, 2009 09:52 am at 9:52 am |
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