Joe Biden Won’t Get Credit For Stopping The SVB Meltdown
Joe Biden Won’t Get Credit For Stopping The SVB Meltdown
As usual, the media ignores when Democratic presidents prevent catastrophes.
As usual, a Democratic president is cleaning up a mess caused by his Republican predecessor. Thanks to the GOP’s reckless regulatory cuts, Silicon Valley Bank was allowed to profit from bad lending decisions without backing up enough of their depositors’ money to prevent bankruptcy, and is now essentially getting bailed out by the government to protect their customers’ money.
And, as usual, no one in conservative media will give Joe Biden any credit for stopping a potential bank catastrophe that could have precipitated other bank runs, bankruptcies, and possibly even a massive financial meltdown like 2008.
Critics are bemoaning the fact that the Biden Administration is guaranteeing all depositors in SVB, which means that all banks and their customers will have to pay more for the FDIC insurance payments, but the reality is that we discovered it was pretty stupid that so many new tech companies and startups had all their money in just one bank.
However, it is not good for our society to have all of these companies lose their money, fail to make payroll payments to their employees, and follow SVP into bankruptcy. March 15 was a payday for hundreds of thousands of workers who might not have been paid had the Biden Administration, Treasury, and Federal Reserve not so quickly reacted to stop further economic implosion.
This brings up an obvious problem with conservatives throwing out the term “moral hazard” to refer to bailing out the bank to protect the depositors. Conservatives never bitch about “moral hazards” when Republican administrations and legislators pass their trademark policies of deregulation. But, when the inevitable financial blowback of laissez-faire banking policies occur a year or two later, Republicans are the first to both bitch about government intervention and oppose any and all potential future regulations that would make future bank failures less likely.
To add liberal insult to injury, conservatives are blaming the SVB failure on Wokeism… as if all the uber-rich tech bros behind the bank and many of its top customers, such as Peter Thiel, aren’t libertarians obsessed with decentralizing finance every chance they get to weaken the US Dollar, prop up the value of their various cryptocurrency competitors to the Dollar, promote their blockchain alternatives to centralized banks, and cause chaos to embarrass and belittle the government.
Had the bank run contagion spread to other banks, millions of Americans would have lost their money, which makes it so incredibly annoying that there are hundreds of thousands of Republican and libertarian voters who DIDN’T lose their money this week in further bank failures, DIDN’T fail to make payroll payments to their employees, and DIDN’T have to endure another potential Great Recession thanks to Joe Biden’s policies they have no doubt spent the past two years calling “communism.”
Thanks, Joe Biden, and thanks also to the Federal Reserve and the US Treasury. The last two weeks prove why the government is a good force for promoting national and economic stability, and why all the decentralized finance tech bros who hate the government but immediately called for SVB bailouts are hypocrites.
Thanks for your eyeballs!
—Dash MacIntyre
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