Power from the banks and to the people
Populist banker. Now those are two words you rarely see linked together.
But Thomas Hoenig, president of the Federal Reserve Bank of Kansas City, truly is a rarity. Firmly rooted in small town Iowa and Kansas, he has never aspired to be part of the Wall Street-Washington power elite, and he has no hesitancy to challenge their financial orthodoxy and obsequious kowtowing to the preening barons of big banking.
In a recent New York Times op-ed piece, Hoenig laid into the claims by the political and financial establishment that the massive taxpayer bailout and subsequent regulatory “reforms” of Wall Street have fixed the banking system. Let me give it to you in his own words: “After this round of bailouts, the five largest financial institutions are 20 percent larger than they were before the crisis. They control $8.6 trillion in financial assets – the equivalent of nearly 60 percent of (America’s) gross domestic product. Like it or not, these firms remain too big to fail.”
How big are they? So enormous, says Hoenig, that “their chief executives cannot manage them, nor can their regulators provide adequate oversight.”
And, countering the contrived contention of the Washington-Wall Street axis that only huge banks can compete globally, Hoenig points out that our banking system must be structured to serve our national interest, not the insatiable self-interests of multimillionaire bankers and billionaire speculators. Again, his own words: “More financial firms – with none too big to fail – would mean less concentrated financial power, less concentrated risk and better access and service for American businesses and the public.”
How about that? A big-time banker who wants to shrink the giants of Wall Street, believing that bankers should serve us, rather than vice versa. There’s an idea we can all get behind.
And, it looks like we have another odd bedfellow in our corner. The teabag-infused Republican takeover of the U.S. House has produced one big change that is distressing GOP leaders, dismaying the tea party’s corporate funders and discombobulating the elite bankers at the Federal Reserve. The change is this: Ron Paul.
This 75-year-old ultra-libertarian from Texas has been in Congress for some 35 years, building a consistent record of contrarian views and votes, some of which are quite progressive. He’s been a vigorous opponent of U.S. military adventurism around the globe, for example, and an outspoken advocate of pulling all U.S. troops out of both Iraq and Afghanistan. This iconoclast has infuriated many in his own party, who have long dismissed him as an extremist nut.
But now, Paul has gone from an irritating pest to holding real power. He’s the new chairman of the subcommittee that oversees the Fed, America’s central bank. He views this secretive, autocratic financial agency as a tool of the Wall Street giants, and he’s even written a book titled End the Fed. Last month, prior to assuming his chairmanship, Paul caused an epidemic of apoplexy among Fed officials and big bankers by announcing that he’ll be pushing for a full, annual audit of the agency’s financial dealings with the global elites.
That seems sensible to me, not nutty. After all, the Federal Reserve is an outfit that furtively funnels trillions of our nation’s dollars to private profiteers around the world – yet its transactions are not audited or open to public scrutiny.
Excuse me, but it’s the system that’s kooky, not Paul, and he’s about to shine a bright light into the dark temple of the Fed, exposing an institutional collusion with Wall Street that enriches the few at the expense of the common good.
An unleashed Ron Paul not only scares the bejezus out of the bankers, but also the GOP political establishment, which is thoroughly marinated in Wall Street money. What fun!
To keep up with the twists and turns, and to help Paul stand firm, go to www.ronpaul.org.
Jim Hightower is a national radio commentator, columnist and author.