The ol’ male bankers may call it the “Bair Bitch Project,” but Main Street investors will see it as a call to arms.
The former chair of the FDIC Sheila Bair was at the table — when the males told her about the meeting — during the financial crisis as it exploded on the scene in 2007.
In her new tell-all book, “Bull by the Horns,” Bair lays it out in her straightforward, take-no-prisoners fashion that has won her so many fans on both sides of the aisle.
In her book, Bair takes Treasury head Tim Geithner to task for his zeal in bailing out Wall Street to the detriment of Main Street; she refers to Geithner as the “bailouter in chief.”
She felt Geithner’s selection as Treasury secretary was like “a punch in the gut” and knew he would never fill Hank Paulson’s shoes. (Bair pushed hard for President Obama to select Paul Volcker.) Geithner was, after all, the chief of the New York Fed, responsible for overseeing the very banks that had just crashed and burned.
In Bair’s account, it is clear that the White House said one thing and did another. Bair writes that the use of TARP/taxpayer money solely to prop up banks and coddle political pals like Citigroup’s Vikram Pandit was viewed by her as a complete misuse of the money — especially in light of the fact that Main Street was shut out.
In fact, the bank bailout itself was a ruse; it was all really for the politically connected and protected Citigroup, writes Bair.
Bair strongly opposed Pandit being made CEO of Citi. Bair wanted someone with commercial banking experience and a strong reputation. Pandit’s reputation was weak, and he had never run a commercial bank.
Geithner even went so far as to hold talks about Citi’s takeover of Wachovia in what would have been a sweetheart deal, behind the FDIC’s and Bair’s back.
Meanwhile, Bair explains, the administration’s approach to helping struggling homeowners was so narrowly crafted that few could ever qualify. Geithner and Summers made it tough under the guise of “moral hazard” — when the same principles were not applied to their politically favorite bank.
So Main Street’s money really went to bail out Citigroup — the administration’s bank of choice.