Democracy Now--Eliot Spitzer: Geithner, Bernanke “Complicit” in Financial Crisis and Should Go

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Democracy Now--Eliot Spitzer: Geithner, Bernanke “Complicit” in Financial Crisis and Should Go

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AMY GOODMAN: Well, why don’t you start off by talking about how you think President Obama has handled the economy, the bailout? And you can’t speak in sound bites.

ELIOT SPITZER: Alright, no sound bites on this show, which is good news. And thank you for inviting me.

Let me begin by saying that I think Senator Sanders was wrong in only one respect: it wasn’t that the Fed was asleep at the switch; they were actually complicit. And by that, what I mean is that the Chairman, Ben Bernanke, and Tim Geithner, when he was the president of the New York Fed, actually built and participated in creating the structure that now has collapsed. And that, I think, is what is so problematic to so many of us. They are now claiming credit for having taken trillions of our tax dollars and given those dollars back to the banks to return them to solvency, when the initial bankruptcy and the initial illiquidity and the initial crisis was very much a consequence of the very policies they put in place.

Stepping back for a moment, we have a major crisis in this nation, and that crisis is jobs. That crisis is that we are seeing the elimination of the middle-class job foundation that permits most Americans to do better year after year after year. The reality is median family income has been stagnant for forty years, and the policies of what I call financialization, which is major banks trading assets back and forth, the Wall Street banks, such as Goldman, which is rightly a lightning rod right now for much of what’s going on, buying and selling, playing with tax dollars in proprietary trading—they make huge money, nothing is added to the economy, jobs are sent overseas. All of this going on simultaneously. That is what our economy has become.

And Ben Bernanke and Tim Geithner were the architects of this. And now they are saying, “Didn’t we do a good job six months ago giving money to the banks?” No. Go back two, three, five years. Where were they? Tim Geithner, over and over, bailed out the banks. He was, as president of the New York Fed, the overseer of the institution that collapsed. And so, it’s akin to going to a doctor who has said, “I have a great technique for you: I’m going to bleed you,” and he bleeds you, and he gets you more and more sick and sick and sick. Then when you’re about to die, he puts a tourniquet on you and says, “Gee, I’m good.” No, your prescriptions have been wrong since the beginning.

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http://www.democracynow.org/2009/12/4/eliot_spitzer_geithner_bernanke_complicit_in