You're currently reading an archived version of Jim Hightower's work.
The latest (and greatest?) observations from Jim Hightower are only now available at our Substack website. Join us there!
When Henry Paulson was plucked out of Goldman Sachs last year by George W to be treasury secretary, he had amassed a multimillion-dollar personal fortune as a Wall Street banker and was hailed by Bush as a no-nonsense, straight-shooting “genius” of high finance.
Then came this year’s subprime mortgage collapse, in which thousands of lower-income American homeowners began to lose their homes, thanks to an unregulated home-financing system heavily promoted by Wall Streeters like Paulson. Oh, not to worry, the genius treasury secretary said reassuringly in March – the subprime mess is “largely contained.”
Enjoying Hightower's work? Join us over at our new home on Substack:
By August, however, the mess was reaching up to drain some big Wall Street financiers and spreading even into foreign markets. Yet again, though, the genius put on his not-to-worry mask, insisting that the free market would correct everything. “We’re going to work through this problem just fine,” cooed the banker.
At last, however, Paulson has had to shed his mask and face a little reality. Homeloan troubles have now spread into the middle and upper-income markets, millions are in danger of losing their homes, new home sales are down 20 percent from last year, and other sectors of our economy are being sucked down by the mess. Suddenly, the genius is wailing that the housing downturn is a risk to our whole economy and that emergency steps are needed, PDQ.
In a bitter twist for those who’ve already lost their homes, Paulson now complains that they could have been helped if only bankers and government had acted sooner. Hello… Henry… weren’t you the one telling everyone to keep their hands off the problem, to let the market work its magic?
Yet the guy who stalled needed reforms earlier this year continues to oppose strong measures to deal with the crisis. Paulson is showing more concern about protecting Wall Street than helping the hard hit people in our country.
“Only One Word For Subprime Mess,” The New York Times, July 1, 2007
“Housing turmoil a ‘risk’ to economy,” USA Today, October 17, 2007
“Treasury chief: Housing is biggest risk to economy,” Austin American Statesman, October 17, 2007
“As Defaults Rise, Washington Worries,” The New York Times, October 16, 2007
“Paulson Says Housing Woes to Worsen,” The New York Times, October 17, 2007