Money in the bank?

November 21, 2008 2:02:46 PM PST
How would you react if you loaned a friend a bunch of money because she couldn't pay the rent, and then, a month later, you get a card from her from some tropical resort, gushing about how much fun she's having?

I suspect I know how you'd react - or at least I know how I'd react.

Which is why so many people are ticked off about the billions - make that hundreds of billions - in taxpayer bailout dollars that the nation's banks have been given.

Because many of the banks are apparently using the funds to pay dividends, for buying other struggling banks and for lucrative compensation for their executives.

That's according to Senate Banking Committee Chairman Chris Dodd from Connecticut.

Dodd today told National Public Radio that the real figure of the bailout isn't $700 billion -- "it's about $5 trillion..... If you take the guarantees, the increase in insurance and deposits, all of these things that have been done, the number is vastly in excess of $700 billion. I don't think I'm being excessive by demanding that these lending institutions show a commensurate degree of responsibility to the American taxpayer, and to be taking steps to help us relieve the clogged up, seized up credit markets in this country. So, if there's a note of anger in my voice, it's here."

It's one thing to argue that without a taxpayer bailout the financial markets would collapse. It's another to launch into this socialism-for-the-companies-that-made-bad-decisions by giving them carte blanche with our money.

We'll have the latest on the economic crisis - including a last minute surge on the stock market - tonight at 11.

Also at 11, we're following President-elect Obama's transition, which tonight may or may not include another political drama involving Hillary Clinton. Last night we reported that Obama would nominate Sen. Clinton as his Secretary of State, after both sides worked out an agreement on Bill Clinton's complicated finances, which includes fundraising for his foundation from dozens of international sources. That's a huge potential conflict for a Secretary of State Hillary Clinton.

The tick-tock of all this is fascinating. ABC News reports that on Wednesday night, Sen. Clinton told the Obama Transition Team (OTT for short) that she was "inclined to reject" the offer to become Secretary of State. But the OTT apparently encouraged her NOT to make a final decision.

Then yesterday, some Obama insiders reached out to Clinton and apparently convinced her to take the job. So by Thursday night, she accepted the offer.

So - is this a stroke of genius or a huge political gamble by Obama? The answer may be yes.

We'll have the latest tonight - because we're now being told that some "details" are still being worked out. Oh the drama of it all.

There were other movements to fill Cabinet posts - including Treasury. The expected nominee is a New Yorker - Tim Geithner, President of the Fed here in New York. He is known as "Obama-esque" because he's young, went to elementary school in New Delhi and high school in Bangkok, and he likes to play pickup basketball. And New Mexico Gov. Bill Richardson is seen as the likely nominee for Secretary of Commerce. (Read more)

One more political note -- did you see Gov. Sarah Palin pardoning a Thanksgiving turkey in Alaska yesterday? It's quite a spectacle, because the woman who wanted to be a heartbeat away from the Presidency allowed herself to be interviewed at a turkey slaughter house where, just feet behind her, a man was literally killing turkeys. It was a bloody mess - so ugly that dangling turkey heads were fuzzed out of the video shot by the local Alaska TV station.

The scene was straight out of a Saturday Night Live skit, with a Governor trying to give a serious interview, complete with run-on sentences, while behind her there was bloody butchery - totally disconnected from what she was saying.

Also at 11, and speaking of Thanksgiving dinner (and doesn't a turkey butcher house make you hunger for a bird on the table?), Tappy Phillips and 7 On Your Side tonight have some money-saving ideas for shopping for the big meal. And by money-saving I mean buying the whole dinner for less than half the normal price.

We'll also have any breaking news of the night, plus Lee Goldberg's AccuWeather forecast, and Scott Clark with the night's sports. I hope you can join Liz Cho and me, tonight at 11, right after 20/20, and Diane Sawyer's interview with Ashley Dupree, the prostitute at the center of the Eliot Spitzer sex scandal.