Time Magazine's editors got a jump on April Fools Day when they named Fed Chairman Ben Bernanke its Person of the Year. Here's what Bernanke did since he took over the Fed in 2006 to earn the laughable award. He winked and nodded at the fraudulent AIG, JPM, and Bear Stearns bailout without demanding compensation to the treasury (taxpayers) in return for the giveaway billions. He looked away as the banks and financial houses went on a free wheel orgy in trading risky and ultimately hollow derivitatives.
He winked and nodded again when Godman Sachs did its own deft shuffle and transformed itself from an investment bank into a bank holding company. The result: Goldman got FDIC coverage for a nearly $30 billion loan. Bernanke said nothing when Goldman played fast and loose speculation with the money. This obliterated any semblance of the firewall between commercial and investment banking
Bernanke winked and nodded yet again at the massive bait and switch sub prime lending scams. This was the tipping point that plunged the economy into the current faux 1930s Depression spiral. The estimate is that Bernanke's Rip Van Winkle sleep at the wheel nod off to Wall Street will cost every American family tens of thousands in lost wages, income, assets and productivity in the coming years. Bernanke has thumbed his nose at the tepid, and scattered protest from some in Congress to provide transparency on how and to whom the the Fed shelled out trillions through the Fed's special lending programs.
Bernanke's provided absolutely no hard target regulatory oversight over the failed and flawed Wall Street banks and finanical houses. Even as he faces a rough day on Capitol Hill when his confirmation hearing comes up, he still hasn't said what he'll do to end Wall Street's casino play of public monies.
Bernanke screamed wolf as loud and long as Former Bush Treasury Secretary Henry Paulson did last year that Wall Street and the big banks would collapse without an immediate dump of billions to them. He finally badgered and hectored a scared stiff Congress into plowing the cash into the coffers of Wall Street under alleged pain of financial armegeddon. And then he did not utter a peep of protest when Wall Street took the money and continued to outrageously fatten the bank accounts of their motley crew of greedy, incompetent and inept executive horse traders who brought the very banks and financial houses Bernanke shouted were to big to fail to near financial shambles. He did not breath a whisper to the big bankers after they grabbed the cash that they must open the lending spigot to at risk home owners, needy small businesses, and industry in return for their ill gotten taxpayer gain.
Time's rationale for dumping its award on Bernanke is that he was the Churchill of America's financial system. He saved it from collapse. This is Tooth Fairy tale stuff. Bernanke didn't save a system from collapse. He saved a handful of flopped banks and financial houses that engaged in Las Vegas style roulette stock spins, swaps and game playing with investor and public monies from a crisis that he and they helped create.
He did it by tossing billions of free money taxpayer dollars at them. If Time really wanted to do its Person of the Year joke right it should have given its award to swindle king Bernie Madoff. But then again maybe that wouldn't have been much of a joke either since Bernie's scams cost rooked investors billions. Bernanke's cost taxpayers trillions.
Earl Ofari Hutchinson is an author and political analyst. His forthcoming book, How Obama Governed: The Year of Crisis and Challenge (Middle Passage Press) will be released in January 2010.
