Refunds at the Casino, Courtesy of TaxpayersIn my favorite scene in one of my favorite movies, "Lost in America," a distraught couple makes an impassioned plea to the casino manager to return all the money that the gambling-addict wife has just lost.
The LA-based couple, played by Albert Brooks and Julie Hagerty, had just decided to drop out of the rat race, sell all their belongings, and use the proceeds to travel cross country (in a mobile home, yet).
They make it as far as Las Vegas before Hagerty's' character blows their (sizable) nest egg playing craps.
Broke and desperate, Brooks' character, a marketing guy, has a brainstorm: the casino should give them all their money back as a public relations stunt!
He pitches the casino manager:
What about a billboard with my wife and I on it and we would be smiling and there would be a saying, something like, "These people . . . lost their nest egg at The Desert Inn, but The Desert Inn gave it back." And maybe there could be some kind of a visual with you handing us an egg or something. Now I mean, I'm just formulating this now, as I'm talking, but you can imagine, when it's worked out how effective it could be.
Picture this: maybe, my wife and I will do a television commercial for you and there could be a jingle and it could go: (begins to sing) "The Desert Inn has heart! The Desert Inn has heart! The Desert Inn has heart!" Something like that. See what I mean?
Here's how the casino manager, played by a pitch-perfect Gary Marshall, responds:
I gotta tell you, this is one of the best things I've ever heard. What's the board gonna say again? "Gamblers, come and get your money back." Great. That's great.
He continues:
Let's assume you're serious here. What if this caught on? Could you imagine what would happen? Why, we would have to return everybody's losses. The casino would just crumble. We couldn't pay our bills. You know the casino accounts for a great deal of our profits.
Albert Brooks then tries to explain that the casino wouldn't make everyone whole:
I understand. Of course, you don't pay back everybody's losses. You make a distinct division between the bold, who are out there searching, and all the other schmucks, who come here to see Wayne Newton.
No go (it turns out Gary Marshall's character is a Newton fan).
Here's how things conclude:
Brooks: And just so I understand, we can't get any of our money back, right?
Marshall: Well, not today, no. But if the policy ever changes, we'll write you. (still chuckling as he goes back into his office) That's wonderful. Very good.
If only this scenario had played out in real life.
Imagine, when Henry Paulson had gone to Congress with his request for $700 billion in TARP money, he'd been told: 'good luck to you and stay away from the tables next time.'
Instead, when Wall Street asked government for its money back, it -- us -- gave it to them!
Lost, indeed.
P.S.: guess who the "schmucks" are?
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4 comments:
I don't disagree that the banks haven't been as "grateful" and repentent as we might have liked, but what would have been the alternative to TARP? Would the country be in better shape had the investors, individual and pension funds, been wiped out? Same question for the auto industry; would the country be better off with 1/6th of jobs in country gone?
Not sure that we've really "saved" all those auto industry jobs; more like, just delayed the inevitable --- at a huge cost (like the now bankrupt CIT, plus a few zeroes).
As far as the financial system, I think the goal should have been to save the system, not specific actors. Looks to me like we've done the reverse: wrecked the system, saved the likes of Goldman Sachs, etc.
And I think it's far from clear that all the emergency measures to date have cured the patient.
I agree that the patient is now stable, which is a huge improvement. However, it's still suffering from the same cancer as before . .
Had you been Secretary of Treasury instead of Henry Paulson, what would you have done?
Had been Secretary of Treasury, with TARP in place, instead of Timothy Geitner, what would you have don?
When you're experiencing a financial 9/11 -- which is what Sept., '08 was -- you respond the same way: temporarily shut down the system; assess what has failed (and what hasn't); and bring it back online once you've addressed the most egregious problems.
FDR did that by declaring a "Bank Holiday" (nice name for a full-blown emergency) in 1933.
Yeah, the pain would have been extreme. But it would have been short-term.
Instead, we're going down the path Japan took.
P.S.: longer-term, you change the culture: no more Geithner's, Paulson's, etc.
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