Winners and Losers
Last Monday morning there was a fire at a home in our neighborhood, just past the park where we often go to play. I didn’t think much of it; houses do, unfortunately, catch fire for a whole host of reasons.
Yesterday I sat down to read my daily dose of The Automatic Earth and came across this passage in one of the linked articles:
Wanda Dunn told neighbors she would rather die than leave her home. On October 13th, the day she was to be evicted, the 53-year-old Pasadena, California native apparently set fire to the home “where her family had lived for generations” before shooting herself in the head. “We knew it was going to happen,” neighbor Steve Brooks told the Los Angeles Times. “It was nobody’s fault; it was everybody’s fault.”
I felt a chill as I read that passage and quickly turned up the LA Time article, “Pasadena woman facing eviction is found dead in burning home”. There was the explanation for the fire. It wasn’t caused by an electrical accident, a malfunctioning fireplace, or a careless cigarette. It was an act of tragic desparation. Ms. Dunn was being evicted from the home she and her family had lived their lives in because the owner of the home had stopped paying the mortgage and the house was in foreclosure. I didn’t know Wanda Dunn, perhaps she was one of the kindly ladies who would, smile, wave, and say “Good morning” while Thomas and I walked past her home to the grocery store or the library. I do know Wanda Dunn deserved better.
During the same reading session I came across an entirely different article, “KeyCorp, Regions Mull Federal Money as Paulson Backs Mergers“. The article describes how some large regional banks plan to apply for some of the $250 billion in funds that Secretary Paulson has decreed shall be used to recapitalize banks.
Regions, Alabama’s biggest bank, said it will raise as much as $3.5 billion by selling a stake to the government. KeyCorp, the No. 3 Ohio lender, will seek between $1.1 billion and $3.3 billion, while bigger rival National City also mulls a stock sale. Some cash may finance takeovers, the bankers said today. ”I’m telegraphing that we’re more active and more interested than we might have been before” on acquisitions, U.S. Bancorp Chief Executive Officer Richard Davis said on a conference call. Government money may be “quite attractive,” said the 50-year-old CEO of Minnesota’s biggest bank…Lenders that are approved by the government can use federal money to increase lending, acquire other banks, or raise additional capital from the private sector, said William Sweet, a partner in the Washington office of law firm Skadden, Arps, Slate, Meagher & Flom LLP. “There’s no specific limit on the actual use of the funds,” said Sweet, who focuses on financial institutions. “Those institutions that have the management and resources and inclination to leverage the government money by fixing other problems will find it easier to attract the investment than those without a plan.” [emphasis added]
And in the final paragraph of the article the kicker.
JPMorgan CEO Jamie Dimon, whose firm has already been tapped to receive a $25 billion infusion, said Oct. 15 he “would be willing to use it for anything that made sense for JPMorgan shareholders” including acquisitions. [emphasis added]
This is what your tax dollars are being used for: “anything that makes sense for JPMorgan shareholders“. This perpetual series of bailouts, rescuses, and infusions of taxpayer dollars is not being used to help you or to help me. It is not being used to help our unfortunate neighbors struggling to get by. It certainly wasn’t used to help Wanda.