Felix Rohatyn Promotes a Domestic IMF
Posted by Larry Doyle on April 13, 2010 8:53 AM |
Given the massive budget gaps and pension shortfalls encompassing a large swath of our municipal landscape, should our nation think about launching a domestic version of the IMF (International Monetary Fund)? If we were to listen to the wise old Wall Street veteran and Washington confidante Felix Rohatyn, we should do just that.
Rohatyn, a senior investment banker at Lazard Freres, was heavily involved in the restructuring and recapitalizing of New York City during its fiscal nightmare back in the 1970s. He is not bashful in stating that a domestic IMF may very well be necessary to address our current municipal deficits.
The Wall Street Journal highlights Rohatyn’s outlook this morning in writing, Lazard’s Statesman, A Game-Changer:
It should make you queasy. But investment banker Felix Rohatyn doesn’t flinch when he says it: A “domestic IMF” is necessary to help American cities and states stave off budget crises.
Here we go, boys and girls. To borrow the title of Barry Ritholtz’s outstanding book, welcome to Bailout Nation.
Still, in his first full interview since his return to Lazard, the 81-year-old showed plenty of bite, especially over how to confront the budget crises coming to America’s cities and states.
The natural provider of this relief would be the U.S. government. Mr. Rohatyn invokes the Depression-era program Reconstruction Finance Corp.—which largely financed private businesses—as a potential model for injecting relief into local governments. “A lot of capital can be generated. Its objective is logical. There is no other ultimate source.”
Felix, have you looked at our debt/GDP ratios lately? How much is enough? I do not expect your big government wealth transfer crowd to ever understand the crippling and corrupting nature of spending other people’s money. How has this style worked in Detroit for you?
Mr. Rohatyn holds a deep belief that big government projects can do good. He recently published a book called “Bold Endeavors” that lauded a series of government interventions, from the Louisiana Purchase to the G.I. Bill. Such an intervention should have been used to save Lehman Brothers Holdings Inc., says Mr. Rohatyn, who served as a senior adviser to Lehman chief Richard Fuld from 2006 until the Wall Street firm’s failure in 2008.
Are you kidding me? Rohatyn has the balls to equate the funding of the Louisiana Purchase and the GI Bill to bailing out Lehman Brothers? If Rohatyn were, in fact, a senior adviser to Dick Fuld, perhaps we can get his opinion on Repo 105 and the cooking of Lehman’s books.
Mortgaging my children’s future and that of all America’s children so that Rohatyn and his cronies can bail out their failed social policies and programs embedded in decades of an unchecked liberal agenda is anything but ‘sense on cents.’