Sunday, March 8, 2009
More Sunday morning, TV News: Republicans say some big banks should be allowed to fail; Omigosh! Will kitty cats soon be sleeping with puppy dogs
In an incredible shift of traditional GOP positions, two key Republican senators told Sunday morning TV audiences that some big banks should be allowed to fail.
Yes. They actually said that.
One was Richard Shelby of Alabama and the other was John McCain. That would wipe out investors in bank common stock and a lot of executives, groups traditionally supported by the GOP.
I'm not saying that I disagree. I'm just shocked. Pleasantly so.
And the Obama administration wants to bailout all the big banks. Go figure.
Truly, the political world is turned upside down.
The New York Times reports:
John McCain and Richard Shelby, two high-profile Republican senators, said on Sunday that the government should allow a number of the biggest American banks to fail.
“Close them down, get them out of business,” Mr. Shelby, the senior Republican on the Banking Committee, told ABC’s “This Week With George Stephanopoulos.” “If they’re dead, they ought to be buried.”
While the Alabama senator did not say which banks to shutter, he suggested that Citigroup might be on that list, saying the bank has “always been a problem child.”
Mr. McCain, appearing on “Fox News Sunday,” echoed that sentiment without identifying any banks. Mr. McCain, who lost the presidential election last November, also accused the Treasury Department of avoiding the “hard decision” to let “these banks fail.”
Investor concern about the future of banks, including Citigroup, have been one issue weighing heavily on the stock market. Financial shares continue to be among the worst hit, despite the trillions that governments are spending to try and restore the system. Citigroup shares, for example, closed at $1.03 on Friday; two years ago, the stock was trading at $55 a share.