December 10, 2009
Timothy Geithner displayed a plethora of emotions at times under the scrutiny of the T.A.R.P. oversight committee. Secretary Geithner was at times confrontational, condescending and visibly frustrated in the hour and a half testimony.
Chairwoman Warren was unimpressed on a number of explanations given by Geithner specifically regarding the decision to bail out insurance giant AIG. Secretary Geithner said, “If AIG would not have met its contractual obligations to its counterparties, it would have defaulted, it would have been downgraded and the company would have been liquidated.”
Despite the fact that AIG strongly opposed government intervention in the first few days of the economic whirlwind, the government none the less, arbitrarily assumed AIG was so pivotal to the overall economic survival of the globe, the 90 cents on the dollar credit satisfaction AIG was to propose to its counterparties, was unacceptable to the government.
The problem here besides the outright interference in the capitalist system is the Nostradamus-like arrogance of a few individuals in our government that believe they knew what was best for the entire globe. Capitalism works, only if left alone. Government intervention into the economic crisis not only exacerbated the problem, it provided even greater hurdles and liability (debt to China) to the Country as a whole.
Throughout history individuals have tried to dictate to the majority their belief of what is best for all. Instead of having a tax cheat decide what’s best for the globe, we should let capitalism run its course, pay the price and rebuild.