THE Mayor of New York, on BBC News ‘Hardtalk’ programme dropped a bombshell: “Governor of California, Arnold Schwarzenegger will need US$7 billion dollars to rescue the State of California from going bankrupt! He has applied to the Federal Reserve for a bailout!”The “credit crunch” which bit the financial institutions could well be biting US states, and in the next few days (or weeks) could hit countries. Iceland has been the first country to admit that it could ‘go bankrupt’.
Both US presidential candidates are still talking tax cuts. This is interesting capitalism. How can you talk tax cuts when you are going bankrupt?
The Lehman Brothers Chief Executive Richard S. Fuld revealed to a Congressional Committee this week that he had earned over US$250 million from the organisation during the boom times. Never mind the meagre salaries of the lower level staff in Lehman Brothers who are victims of the sub prime mortgage market, but mind the losses that Lehman Brothers suffered that are now being nationalised.
Fuld used his big paychecks to fund political campaigns by Democrats and a few Republicans, he admitted.
Los Angeles Times reported: “The biggest recipient of his largess has been the Democratic Senatorial Campaign Committee at $47,000, including $10,000 last year. He gave another $10,000 to the Republican Senatorial Campaign Committee. Party leaders use donations to the committees to help fund races around the country.”
The newspaper went on: “His most recent federal donation, $5,000 in May, went to a political action committee funded by Wall Street firms -- some of which no longer exist -- that gave to an array of politicians. Fuld also gave directly to politicians, including $2,300 to Barack Obama in May 2007, and $2,300 to John McCain in March 2007.”
Still more details were revealed: “New York Sen. Charles Schumer has taken $6,000 from Fuld. Joseph Lieberman has taken $7,000.”
Democratic presidential hopeful Hillary Clinton was also implicated in the scandal. Clinton disclosed the amounts paid in Federal Election Commission filings made last month, shortly after Lehman's Sept. 15 declaration of bankruptcy.
In Africa, this would have been simply called “corruption,” but not in America.
So would Clinton have disclosed these if Lehman Brothers had not folded? Would we have known about this level of corruption in a country low on the index of corruption if the international crisis had not unfolded? Should we keep looking up to these governments as our saviors in times of trouble? Should we keep making apologies for systems that are clearly crumbling, yet spending billions killing people?
Africans should now devise methods of dealing with, and charting their road to, the future without seeking the stewardship of individuals and governments that are themselves highly flawed.
If California is folding and needs a bailout, is Zimbabwe well poised to receive a bailout? Would America bail out Zimbabwe before it bails out California or some other state in the U.S.? Or possibly, it will keep making excuses about the inadequacy of the power-sharing deal to evade the huge promises made previously.
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