Jan 112012
 

Between August 2007 and April 2010, the U.S. Federal Reserve handed out up to $1.2 trillion in public money to banks and other companies in the form of short-term loans to help them cope with cash flow problems, according to a recent report by the Bloomberg news service. In addition to U.S. banks and speculators, big bucks went to financial institutions owned by foreign governments; domestic firms like Ford and G.E. as well as Toyota and Mitsui and a German real estate investment firm.

While American taxpayers kept big businesses all over the planet alive, no such loans are available to taxpayers to cover their own personal cash-flow problems, including not being able to pay their mortgages, monthly bills, put food on their tables or a few holiday presents under the tree.

New figures, ironically also issued by the Federal Reserve, show how much help $1.2 trillion could be – if put in the hands of Americans. According to the Fed, the total amount of all money Americans owed on their credit cards as of last September was $693 billion. All of that could be paid off – in full – leaving another $500 billion, say, to help people avoid foreclosures or give every consumer in the United States a hefty tax cut.

Imagine the “stimulus effect” on our economy of paying off every credit card in the nation.

Although the Fed has portrayed the bailouts as the only way to keep money flowing in the economy, the Money Industry has yet to open its spigot and expand lending. Instead, they’ve used our dollars mostly to inflate CEOs’ executive salaries and pay themselves even more ridiculous bonuses.

Zeroing out America’s credit cards would solve that problem instantly. The credit card companies would get the money, of course, but Americans could start fresh and begin investing in their families, their businesses and their local economies.

Unfortunately, our country’s leadership owes its allegiance to the multi-national mega-corporations that grease the system with billions of dollars in campaign contributions. Wall Street’s “investment” in Washington caused the financial depression we are in today, and its no wonder that Washington’s attention is focused so narrowly on the welfare of the wealthy and large corporations. In fact, with its infamous decision equating corporations to human beings, the United States Supreme Court has turned the corruption of our democracy by money into a principle of our Constitution. Until we change that, Americans will be second class citizens in a country controlled by wealth and power.

 

About Harvey Rosenfield

Harvey Rosenfield has been fighting to protect consumers and taxpayers against rip-offs and abuse for thirty years. He’s the author of Proposition 103, the landmark insurance reform initiative, which has saved Californians more than $63 billion in insurance premiums.

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