DYSFUNCTIONAL DEMOCRACY. "What worries me is that we are increasingly enmeshed in incompetent systems, that is, systems that exhibit pathological behaviour but can't fix themselves. ... Even more worrying is the suspicion that liberal democracy as currently practiced around the world, itself has become an incompetent system. ...The inability — and unwillingness — of many Western governments to regulate their banks, coupled with the huge costs then unilaterally imposed on citizens to rescue commercial enterprises judged 'too big to fail' has led to a widespread loss of trust in governments, and a perception that even nominally 'representative' democracies no longer produce administrations that serve the interests of their citizens." Source: John Naughton, academic, newspaper columnist, author of "From Gutenberg to Zuckerberg: What You Really Need to Know About the Internet."
Mary Altaffer / Associated Press
If the whole sequester nonsense makes you growl as much as it does me (and if you're behind in your sequester reading, I columnized on the topic this week), you'll love what a sharp-eyed reader sent me regarding the federal government and big banks.
As you may know, the total amount of federal spending to be cut under rules of sequestration is $1.2 trillion over the next several years, $85 billion of which is supposed to happen this year.
Well, a reader sends along a a Bloomberg.com study that turned up a fun fact: the 10 biggest U.S. banks get an annual taxpayer-funded subsidy of $83 billion.
Not kidding. You can read the whole, complicated thing right here. It's actually a second bite at the subject since Bloomberg's first bite drew lots of counter arguments. But it appears Bloomberg has its ducks (or banks) in a row.
Looks like this is one of those too-big-to-fail arguments, which implies we all should be seeking bank charters, pooling our resources and creating a citizens' bank that's too big to fail.
My reader also notes the following: the amount of the bank subsidies equal about three cents of every tax dollar. She then notes this year's sequestration cuts amount to about -- ta da! -- three cents of every tax dollar.
Her conclusion (and mine and probably yours): "I think we should avoid sequestration by ending our annual subsidy to Too Big to Fail (and now Too Big to Prosecute) banks. But that's just my three cents. Make sense?"
Well, it at least makes for a growl.