By Barry Grey

Excerpts from the full article located at: http://www.informationclearinghouse.info/article21116.htm

 

WSWS” — In an unusually frank article published in Saturday’s New York Times, the newspaper’s economic columnist, Joe Nocera, reveals what he calls “the dirty little secret of the banking industry”–namely, that “it has no intention of using the [government bailout] money to make new loans.” 

”27 October 2008 “

Early this month, he explains, “in a nearly unnoticed move,” Paulson, the former CEO of Goldman Sachs, put in place a new tax break worth billions of dollars that is designed to encourage bank mergers. It allows the acquiring bank to immediately deduct any losses on the books of the acquired bank.

Paulson and other Treasury officials have made public statements calling on the banks that receive public funds to use them to increase their lending activities. That, however, is for public consumption. The bailout program imposes no lending requirements on the banks in return for government cash.”