The documents-chasers at Judicial Watch have unearthed some late-Bush-era memos and e-mail strings showing, among other things, just how non-existent was the nine major U.S. banks' choice when Uncle Sam came knocking on the door last fall. From some Hank Paulson/Ben Bernanke talking points [pdf] for that fateful meeting:
We plan to announce the program tomorrow--and--that your nine firms will be the initial participants.... This is a combined program (bank liability guarantee and capital purchase). Your firms need to agree to both. We don't believe it is tenable to opt out because doing so would leave you vulnerable and exposed. If a capital infusion is not appealing, you should be aware that your regulator will require it in any circumstance.
This is always worth remembering whenever some politician or commentator gets on a high horse about such and such "ungrateful" bank engaging or threatening to engage in unapproved behavior, whether in employee perks or in the course of doing business with, say, auto companies. Comments Judicial Watch:
"These documents show our government exercising unrestrained power over the private sector. Despite promises of transparency, the Obama administration tried to cover up the very existence of these smoking-gun documents. And the cover-up continues, as the Obama administration protects Timothy Geithner by withholding a key document about his role in this infamous bankers meeting," stated Judicial Watch President Tom Fitton.
There's also a telling e-mail string [pdf] about efforts to get both major presidential campaigns on board. This bit in particular, about efforts to engage McCain econ guy Douglas Holtz-Eakin, makes one pine for an alternative history in which the Republican Party in 2008 offered a clear alternative to open-ended bailouts:
I briefed H-E. He seemed to know most already; said he had succeeded in backing down the 'they are nationalizing the banks' crowd...for now.
Nice to be reminded how the GOP establishment thought of its own members' principled objections to a dubious and never-popular policy.