I am not necessarily bashing Citibank here. After all, when the federal government drops $45 billion in your lap with no regard for how you spend it, why not live a little at the taxpayer's expense? Who's going to call you out on it?
Beleaguered Citigroup is upgrading its mile-high club with a brand-new $50 million corporate jet - only this time, it's the taxpayers who are getting screwed.
Even though the bank's stock is as cheap as a gallon of gas and it's burning through a $45 billion taxpayer-funded rescue, the airhead execs pushed through the purchase of a new Dassault Falcon 7X, according to a source familiar with the deal.
The French-made luxury jet seats up to 12 in a plush interior with leather seats, sofas and a customizable entertainment center, according to Dassault's sales literature. It can cruise 5,950 miles before refueling and has a top speed of 559 mph.
There are just nine of these top-of-the-line models in the United States, with Dassault's European factory churning out three to four 7Xs a month.
Giving away free money is one thing. Not caring how it's spent is quite another. The more I read about this banking crisis - and it's far from over - the more I understand the necessity of some kind of government intervention. The feds came in way too late in 1929 and 9,000 banks went under.
Obviously, we can't have that happen today. It would indeed lead to a depression - especially if huge banks like Citibank went under suddenly. But there are alternatives to throwing free money at huge corporations without regard for where it is applied. And there is absolutely no excuse - crisis or no crisis - for the slapdash manner in which the government is keeping track of how this money is spent.
The liquidity crisis has not abated much at all despite the trillions of dollars pumped into the banking system. Word now is that Citigroup and Bank of America will need additional monies in the very near future to avoid catastrophe. The public should demand accountability, transparency, and perhaps even a schedule for when these monies will be returned to the people. The temptation to use funds for purposes other than generating liquidity is just too great when these packages come with no strings attached.
Time to put the big boys on a very short, very tight leash.
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