Thursday, February 26, 2009

Remember The House Bank Scandal

From The American:

Banks that are owned by governments will be run to benefit politicians.

As the federal government moves closer to nationalizing more of America’s largest financial institutions, including Citigroup, it’s time to recall the history of federal ownership of commercial banks.
Certainly, the record of the Second Bank of the United States (1816–41) should give us pause. The bank was 80 percent privately owned but effectively controlled by the president and Congress. It was riddled with fraud and corruption and eventually went bankrupt.

The most recent admonitory example is the House Bank. I know it well. In September 1991, when I was editor of the newspaper Roll Call, our reporter Timothy Burger, now at Bloomberg News, broke the story that led to the exposure by the Ethics Committee of 269 House members who had abused the bank with significant overdrafts. In the end, many of them, including Rep. Stephen Solarz of New York, were defeated in 1992 re-election bids.

Read more ....

My Comment: I forgot about this scandal. Stephen Solarz was a rising star in the Democratic Party, his loss and others paved the way for the Gingrich revolution in 1994.

Politicians and money is like oil and water .... they do not mix.

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