Government Bailout

I cannot even express how apalling I think it is that the government is about to hand over $700 billion in yours and my hard earned dollars to these banks which have been completely irresponsible. I completely don't understand it. I will grant that I am completely clouded by my experience at Citi, but I will tell you my experience... (And they will be one of the banks to benefit from this bailout).

They are the most bloated and irresponsible company I have EVER seen. CitifinancialAuto had layoffs, but no other area has had any substantial amount of layoffs. I have heard this might change, but I tell you this. There were TONS of people sitting around doing nothing all day every day. I know this was true of my experience and yet supposedly the company is struggling to make ends meet. The CEO Vikram Pandit has done nothing to stop the insanity and cut down the bloat after having been there almost a year. I would sit there and see people literally twiddling their thumbs while I would be working 80 hour weeks. I would voice my frustration and because management is so incompetent and does not care about the good of the company but making sure they are not seen as a non-team player nothing productive ever got done about these situations. They have matrixed every function and what this means is people are matrixed away from you and so they no longer have any accountability. They report to a manager in a different office who has no idea what they are doing and doesn't do anything when you escalate an issue to them. Your management will not escalate b/c if they do, they fear they will not be seen as a team player. So you end up with a small core team that does all the work and a ton of matrix functions that literally do nothing. You will even ask these people, what do you do and they will tell you that they are looking for work to do. It is a classic b-school case study of how NOT to run an organization but apparently no one in management went to b-school.

Financially all these functions are also matrixed away, but they then send an allocation back to the core business group with no explanation or accountability of those numbers. They have no obligation to keep their numbers to what was budgeted and when you ask for some transparency you are literally told, oh well I have to allocate all these costs out so sorry. If you try to get detail it is like pulling teeth and again when you try to escalate, nothing happens because management doesn't want to be seen as rocking the boat and so the incompetence continues.

Last year when Citi was struggling and cut their dividends to shareholders, we were handing out bonuses equal to 10-20% of employee's salaries. What company have you ever been at that has functioned like that? How irresponsible is that to their shareholders?

And now they want us to give them money? When are they going to pony up and suffer? That is my question b/c they have yet to suffer. And I have seen my boss at the CIO level talk about how the government should bail them out despite them being the ones who were completely unethical and aggressive in their lending practices. Before ANY of my tax dollars should go to these companies, I want to see a reduction in expenses of nothing less than 20%. Right?

These banks AND their employees have been reaping the benefits of their risky lending for how many years now? And we are supposed to feel bad for them now? Oh no, they might be out of a job for 6 months. Where was your and my paycheck when the internet bubble burst? I don't remember us getting 700 billion for all the startups that were over bloated and over valued. You know why? Because we are a free market economy.

I truly believe Paulson coming from Wall Street is trying to help out his buddies there. He and Pandit probably go to the same dinner parties. This is robbing you and me. I encourage everyone to write their congressmen and tell them there is no way they should spend your dollars to support these incompetent companies. It is WAY too early for any talk of such a bailout. I cannot even believe this is what he is proposing. Let everyone tighten their belt for a year or two and let these companies suffer! Let them sell some of their many assets for a loss to survive? The BofA purchase proves that.

And just like I don't think the banks deserve a bailout, I don't think the people who lived beyond their means and got into mortgages they could not afford deserve it either.

It makes me so mad when I have always lived way beneath my means to ensure I was always able to meet my financial obligations. And to have these people who think they are entitled to a house they could never afford and cars they couldn't afford whine to me is ridiculous. You bail them out, you penalize honest hard working people who lived their lives right. Why should we have to pay the price for their risk? We shouldn't.

That said, I think the #1 lesson from this entire mess is that we really need real financial education in our schools. I have always been a big proponent of Junior Achievement because they provide the type of education that every child needs and that a lot of children do not get from their parents. Teach children about credit cards and interest payments and what that means. Teach them about loans and the different ways they are structured. Why is this missing from our schools? I am even okay with mandating education whenever people enter loans. Banks can whine about it, but they put themselves into this position.

Okay, that's my rant for the day. If my taxes go up to pay for these dumb banks, I am going to be so angry. Get Bush out of there. He is the most liberal President ever.