Wednesday, June 10, 2009

Sobering Up the Banks

Like unreformed drunks, American banks want to settle their rehab bills and go back to the old ways--no government curfews or sobriety pledges for the likes of JP Morgan Chase, Goldman Sachs et al as they rush to repay TARP billions and forget they were ever one step from being trampled by pink elephants.

“These repayments," says Treasury Secretary Tim Geithner in the cautious tones of an alcoholism counselor, "are an encouraging sign of financial repair, but we still have work to do.”

The "work" should involve an attitude adjustment on the part of the risk-addicted money manipulators as well as repair of the financial markets. After being on their knees only months earlier, bankers are now anxious to get back to the princely personal highs they derived from practically wrecking the system with greed and irresponsibility.

Even the Wall Street Journal wants to prevent future binges by members of the too-big-to-fail club.

"Unless we can put the kibosh on that unofficial designation for the biggest banks," it says, "their obligations ultimately remain potential taxpayer liabilities...Let them check out for sure, but make sure that they don't come back, or we'll be left with a financial system full of government-sponsored banks with an implicit guarantee should they run into trouble."

At the very least, before letting them resume their old ways, the Treasury should insist on getting bailed-out banks to subscribe to a counterpart of AA's 12 Steps, which include admitting that "our lives had become unmanageable," believing that "a power greater than ourselves could restore us to sanity" and making "a list of all persons we had harmed" and being "willing to make amends to them all."

There is no guarantee that most won't fall off the wagon again, but unless taxpayers want to continue being their enablers, the government should do everything possible to sober them up before turning them loose.

Update: In the comments section of The Moderate Voice, "Silhouette" has a nifty full 12 Steps for "Absconders Anonymous."

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