It's Time to Pull Tim Geithner's Over-Limit Credit Card

Secretary of the Treasury Tim Geithner, the financial genius who admitted he couldn't use TurboTax properly, believes that the solution to a chronic over-limit condition on our national credit card and an admitted inability to pay our debts as they come due is… to raise the limits. I think the Secretary is confusing tactics for winning at blackjack with those needed for spending addiction and political fraud. Mr. Geithner is doubling down, using money borrowed from loan sharks.

Mr. Geithner is playing the old game, now discredited, of mouthing promises that are emptier than the Social Security Trust Fund.

Remember Charles Keating, the man at the center of the Lincoln Savings scandal? He served 4.5 years based on losses of a mere $250 million to 23,000 elderly investors based on shaky securities, and costs to the Resolution Trust and FDIC of only $3 billion.

Pennies. Not even pennies.

How about Bernie Madoff, who built a ponzi scheme of rewarding one generation of investors with the investments of another. To keep the ponzi monster fed ended up costing his victims almost $50 billion spread over a number of years. The losers can draw some comfort, I suppose, that most of the money went to deserving others, people just like themselves. That's the nature of the Ponzi party, rake it from some, give it to others, while the crook(s) at the center rake in the reputational, or political!, benefits of miracle working.

Just as Washington does today, Mr. Madoff  took steps every year to skim off a few dollars to keep himself going, to pay the bills. He fiddled a few more dollars out as necessary to reward particular friends and allies, his supporters, again just like Washington.

Still, $50 billion measured on Mr. Geithner's scale isn't even up to nickels and dimes. Not even a rounding error. Before Mr. Geithner is through, before his boss has completed even a single term, they will have run up more than $6 trillion of new debt.

$6 trillion is 6000 billions of dollars. 120 times larger than Madoff's crime, 2000 times larger than the total cost of the Keating Five.

$6 trillion is a lot of money. It is more than we can repay. It has all been borrowed based on phony numbers and false promises. It has been borrowed from nearly every corner of the world, from billions of people who will never see their investments returned.

Any executive who does the same should end up in jail, serving a sentence in proportion to the size of the fraud and the number of victims. On that scale, Mr. Geithner and his boss, should serve an eternity at hard labor in a hot climate.

It is a crime.