Bank Of Fearica

Sen. Barney Frank is more afraid of the Big Bad Banks than of you.

Otherwise, his financial reform proposal would have called for Bank of America, for instance, to be atomized into billions of harmless, tiny nothings.

Instead, the Chairman of the House Finance Committee has opted to give the Federal Reserve more power over the financial sector.

That’s about it.

That power, however, was never earned through a review process aimed to get to the bottom of how the financial sector nearly collapsed into a black hole of its own making last fall.

After all, that would require the Federal Reserve and its private banking cadre to go against its nearly 100-year reputation of secrecy.

Moreover, since the wall between investment and commercial banking services has yet to be reconstructed in America, Goldman Sachs has free reign to abuse taxpayer dollars guaranteed by the Federal Deposit Insurance Corporation.

Frank’s tax on the Big Bad Banks — his so-called “pre-paying bailout fund” — won’t solve anything either; if anything, it’ll make things worse.

The next time Citigroup huffs, puffs, and dares to collapse, the federal government will collect its fee and look the other way as supposedly “healthy” banks fork over capital to save their unholy breatheren.

Actually, the Big Bad Banks are still very sick; GMAC, General Motors’ late financial arm, is preparing for a third round of government handouts, though it has already received $12.5 billion, and 35 percent of it is owned by the U.S. government.

Citigroup held out its hand last fall and got $45 billion in bailout cash; now it has stockpiled $244.2 billion in cash.

You think stockpiling that kind of cash instills confidence in creditors? Its stockholders didn’t think so, and Citigroup’s stock plummeted last week.

No one has confidence in the U.S. financial zone because Wall Street operates like the Afghanistan Election Commission; it takes our taxpayer money and assures us those billions of dollars went to a good place.

To Wall Street, that good place was the pockets of its lobbyists hell-bent on instilling fear in the heart of Frank.

As such, Frank’s plan will open the check ledger for Congress’ eyes only, not the American public-at-large.

House Democrats don’t like his plan. As Rep. Brad Sherman put it, “This is TARP on steroids.”

And House Republicans don’t like it either. Said Republican Rep. Randy Neugebauer, “The legislation keeps the names of the ‘too big to fail’ firms secret. It allows the picking of winners and losers behind closed doors.”

Even former Federal Reserve Board chairmen Paul Volcker and Alan Greenspan want to see the Big Bad Banks break up.

And good luck trying to get the Senate onboard. There isn’t a Senate version to speak of.

Until then, count on Goldman Sach to make money hand over fist as it dumps homeowners out of their mortgaged homes.

And it’s not like you haven’t seen it before.

It’s what the Big Bad Wolf would do.

— Nathan Diebenow