If there were any lingering doubts as to where the Federal Reserve’s expansive monetary policies are leading, they were dispelled by yesterday’s shocking announcement that the Fed intends to purchase more than $1 trillion in additional debt, which it will pay for by printing new money.
All of the feigned outrage in Washington over the millions that AIG has been doling out in bonus payments, and the tens of billions in bailout monies that it sent directly to major creditors, fails to impress. Beyond the smokescreen of How-dare-they’s, emanating from Republican congressmen and the Obama administration alike, loom larger questions which no one seems willing to ask: how dare our elected leaders give almost $200 billion taxpayers’ dollars to AIG in the first place? And how dare they presume to nationalize a private company like some two-bit cadre of Marxist putschists?
President Barack Obama has just recently released his $3.55 trillion fiscal 2010 budget, and already there's full employment among all the people who matter to officials in Washington, D.C. A front-page story for the March 2 Washington Post began: "President Obama's budget is so ambitious, with vast new spending on health care, energy independence, education and services for veterans, that experts say he probably will need to hire tens of thousands of new federal government workers to realize his goals."
If the talk at the G20 gathering in England is any indication, the hard-beset global economy is stuck between the devil and the deep blue sea. From the American perspective, as articulated by Treasury Secretary Timothy Geithner, what the global economy needs is the same sort of placebo the American government has been administering domestically, to the delight of the ruling classes but the muffled dismay of the middle-class tax base: more stimulus spending.
Official Washington is an a tizzy over new revelations, courtesy of the Wall Street Journal and dutifully amplified by other news outlets, that as much as $50 billion of bailout money sent to ailing mega-insurer AIG was funneled to at least two dozen U.S. and European banks.