France responds to economic crisis with General Strike

[Sol Invictus]

CBC News
January 29, 2009

People everywhere talk about the economic crisis, but the French, in their way, are doing something about it. France has come to a near standstill for a one-day general strike, the CBC’s David Common reports from Paris.

Hundreds of thousands of people are taking to the streets, protesting that banks, not people, are being bailed out and decrying President Nicolas Sarkozy’s cost-cutting moves as unemployment creeps toward 10 per cent.

“Today is being called Black Thursday here in France, and with good reason,” Common reports. “Here’s just a partial list of the things that are closed or in limited service: the metro, buses, trains, airports, hospitals, schools, government offices, post offices — the list goes on and on.”

Thierry Dedieu, a leader of one of country’s major labour groups, the Confédération Française Démocratique du Travail, put the protesters’ view this way: “We want to show that people are dissatisfied at the moment. We don’t want to have to pay for a crisis that we’re not responsible for.”

Although general strikes are no novelty in France, this one seems to have unnerved Sarkozy, who has been uncharacteristically quiet.

That may be partly because the general population, for the first time in a long time, seems to support it, and partly because Sarkozy sees parallels with the May 1968 street protests that helped to push longtime president Charles de Gaulle from office, Common says.

In Paris, commuters braved freezing temperatures and biked, walked and even took boats to work, but a 2007 law ensuring minimal transport service meant that some subways, buses and suburban rail lines were operating, and they were stuffed with passengers, the Associated Press reported.

"I'm not against the fact that people demonstrate to defend their interest and their benefits, as they say, but is this really the best time to do it, considering what is going on right now with the economic crisis?" Pierre Rattier, a commuter, told APTN.

"So I really don't think it's the best time to have done this, but, well, this is typically French."

Source (http://www.cbc.ca/world/story/2009/01/29/france-strike.html)

[SwordoftheVistula]

What exactly is this supposed to accomplish? Screwing the economy up more than it already is?

[Pino]

What exactly is this supposed to accomplish? Screwing the economy up more than it already is?

They have no choice, most people when the economy is doing well or rarther they are told it is doing well get themselfs in a bubble of living in a perfect existence and they dont want to get involved in any form of protest.

It isn't untill people are affected directly that they want to do somthing about it, the time for action is now.

[Sol Invictus]

French strikes: Violence erupts as thousands gather to protest on ‘Black Thursday’

UK Telegraph (http://www.telegraph.co.uk/news/worldnews/europe/france/4394671/French-strikes-Violence-erupts-as-thousands-gather-to-protest-on-Black-Thursday.html)
January 30, 2009


TLTOrgHvO7Q

The streets filled with flag-waving protesters and in Paris protesters clashed with police, throwing bottles, overturning cars and starting a fire in the street.

Labour leaders hailed the strikes and rallies, which marked the first time France’s eight union federations had joined forces against the government since Sarkozy took office in 2007.

“This is one of the biggest days of worker action in the past 20 years,” said Francois Chereque, head of the large, moderate CFDT group.

Unions said 2.5 million people took part in dozens of rallies across France, including 300,000 in Paris. Police put the figure at just over a million nationwide.

Full-blooded chants echoed out across the Place de la Bastille in Paris, with the symbol of the French Revolution at the centre of a day of anti-government demonstrations.

Although the interior ministry said that the protesters numbered just over one million, they were the biggest since Mr Sarkozy came to power in 2007 and on a par with the last huge demonstration, in March 2006, which hastened the exit of the prime minister of the time, Dominique de Villepin.

In the Place de la Bastille, booming megaphones mingled with French rock music and barbecue smoke as an ocean of protesters from the public and private sector marched to call on President Sarkozy to do more to protect jobs and wages, and change tack in fighting the economic crisis.

"Sarkozy gives money to the people who created this crisis, but what about the man in the street?" shouted Antoine Laurent, 20, a history student at the Sorbonne University.

Behind him a group chanted: "Stop the sackings, it's not up to workers to pay for bankers."

One banner read: "360 billion euros for banks, and we are keeling over."

Another read: "Hey Sarkozy, now can you see the strike!" This was an allusion to the French president's famous claim last year: "Now when people go on strike, nobody notices."

After a day of peaceful protests, violence erupted on the fringes of the Paris protest. Dozens of young men wearing scarves across their face were charged down by riot police after throwing stones and bottles, tearing up manhole covers and lighting fires in the Opera district.

[Aemma]

What exactly is this supposed to accomplish? Screwing the economy up more than it already is?

Though I understand your sentiment here Sword, I think that it's important that people don't succumb to 'economic blackmail'. Protesters have a greater impact now during these times to be heard above the din of people wailing over the world's economic woes. France has a long history of 'sticking it to the man' without fear. I quite admire that about its people perhaps because we Canadians are so damn complacent. It's refreshing, it's active, it's energetic. It's what the world needs right now imho to make people wake up to the realities of today.

A modern-day storming of the Bastille might not be such a bad thing in the end. ;)

Cheers!...Aemma

[Grumpy Cat]

These folks are right. The regular people should not have to pay for the deeds of the corrupt bankers who caused this.

I saw one of them holding up a sign "Non aux parachutes dorés". I agree with that, the bank execs are getting let go with large packages (golder parachutes) sometimes in the millions and then some people who still worked for AIG (and other institutions who got that $700 billion from the US) got Christmas bonuses in the millions. Yes, that was the money of the American taxpayer, regular people, who in this economic crisis are being laid off and thrown out on the streets with nothing.

I've never advocated killing people before, but I think these bankers should be publicly executed.

[Treffie]

I've never advocated killing people before, but I think these bankers should be publicly executed.


Amen!!!:thumb001:

[SwordoftheVistula]

Sure, the bankers should be strung up instead of being bailed out. But these guys in their state-protected jobs are part of the problem as well. The country has depended on subsidized export industries, and apparently financial markets as well, to prop up the economy in wealthier times, and that money simply isn't there anymore.

[Revenant]

The protests will not change anything. It might actually accelerate their next pay cut.

[Loki]

These folks are right. The regular people should not have to pay for the deeds of the corrupt bankers who caused this.


Agreed. Vive le France! The French have a talent to stand up to oppression.

It is absolutely outrageous that the banks were bailed out with taxpayers' money ... effectively keeping ordinary folks indebted, and increasing the tax burden even more. Who's to benefit? Large corporations and those who want to enslave the populace. :mad:

What the governments don't want, is to bail out individuals, and have a country of debt-free citizens at the expense of multinational banks.

[stormlord]

I'm not a fan of this somewhat reductionist and populist "screw the evil bankers" stuff that is spouted by a bunch of people who frankly understand very little of how the markets operate or even the fundamentals of international finance. Should the banks that have received public money pay bonuses? No Should they be chased around by ignorant plebs? No.

The way capitalism works, the way it's been accepted by people who were unquestioning when they could have all their consumer goodies and endless credit but now disingenuosly cry foul ( cough..see above..cough) when things blow up, is that companies seek profit. You can't blame companies for acting precisely as they always have, they don't have a duty to be "responsible", that duty lies with the government and the regulators they put in place; both groups have failed profoundly. When you attack "greedy bankers" you're playing right into the hands of men like Obama and Brown, who voted through piece after piece of legislation that let this happen, and sat blithely ignoring warnings for years, but who now try to shift the blame from themselves (people responsible for protecting the people) on to bankers (who are responsible only for themselves). It's not fair and it's not right, and anyone who can think with more subtlety than a twelve year old can see that.

[Sol Invictus]

So the banks are not a pack of criminal control freaks who engineered this crisis with the government in order to take away more of our freedoms and destroy our sovereignty? Oh those poor bankers.. We've just misunderstood them..! Nevermind the fact their grabbing trillions from the people and bailouts sucking the treasuries dry from all of this.. pfff.. Get real.

[Revenant]

Corporate ethics are the laws of the land nothing more. Who ever writes the laws takes responsibility for larger social consequences at the end of the day.

Those laws should be stretched and tested to the nth degree to bleed all's worth out of them for the Corporation. If they aren't, then Senior Management isn't doing their job.

[Sol Invictus]

Corporate ethics are the laws of the land nothing more. Who ever writes the laws takes responsibility for larger social consequences at the end of the day.

Those laws should be stretched and tested to the nth degree to bleed all's worth out of them for the Corporation. If they aren't, then Senior Management isn't doing their job.

Oh jeez! Excuse me..! I guess that somehow makes it 'ethical' in the non-corporate world, while the rest of us line up at soup kitchens and bread-lines, attending work/labour camps relying completely on the government, and not on our own labour .. But that's ok, because the Banks are just doing their jobs, right?

[stormlord]

So the banks are not a pack of criminal control freaks who engineered this crisis with the government in order to take away more of our freedoms and destroy our sovereignty? Oh those poor bankers.. We've just misunderstood them..! Nevermind the fact their grabbing trillions from the people and bailouts sucking the treasuries dry from all of this.. pfff.. Get real.

ooh! ! Genuine hoi polloi! You get the pitchforks, I'll get the torches.

[Sol Invictus]

You get the pitchforks, I'll get the torches.

Now you're talking.. Sure beats your previous sheepish passivity passing this off as 'buisness as usual'.. Though I'm sure you've been told to beat your swords into ploughsheers, and you're just being a good boy doing as you're told.. This isn't the reality of present circumstances brother..

Have some rep..

[Revenant]

Oh jeez! Excuse me..!

Why, what'd you do?:D


I guess that somehow makes it 'ethical' in the non-corporate world,

It makes it legal. In a Liberal Democracy the Government and Big Business have their hands in each others pockets and on the way down to the wallet pocket scratch each others backs.


while the rest of us line up at soup kitchens and bread-lines, attending work/labour camps relying completely on the government, and not on our own labour .. But that's ok, because the Banks are just doing their jobs, right?

You're blaming the system the Banks are taking advantage of on them, they didn't technically create it they just take advantage of it. Maximize value/profit for shareholders and keep it in the black is the bottom line. It isn't about charity, social conscience or anything else like that.

[Sol Invictus]

It makes it legal. In a Liberal Democracy the Government and Big Business have their hands in each others pockets and on the way down to the wallet pocket scratch each others backs.

Exactly.. But you seem to be supporting all this by somehow justifying it as 'legal', so it's alright? I guess you think it's not OK to go out and film public property with a camera because it's 'illegal'... Just because they pass laws that make things ok for them, at the expense of us, doesn't mean we should sit around like morons and let them rape us and drive our countries into the dirt..




You're blaming the system the Banks are taking advantage of on them, they didn't technically create it they just take advantage of it. Maximize value/profit for shareholders and keep it in the black is the bottom line. It isn't about charity, social conscience or anything else like that.


The Banks MADE the system to justify their actions .. This isn't about maximizing profit, it's about destroying buisnesses and leaving you broke as a pile of shit and leaving you at their mercy.. Do some research on the Bilderbergs, Rockafellers, the IMF, and World Bank... Have fun..

[Revenant]

Exactly.. But you seem to be supporting all this by somehow justifying it as 'legal', so it's alright?

For the Banks, yes it is. Government lets them get away with it, so until they change things status quo remains. Apart from those who do not carry out their job descriptions and those who under perform I have no problems with Bankers.


I guess you think it's not OK to go out and film public property with a camera because it's 'illegal'... Just because they pass laws that make things ok for them, at the expense of us, doesn't mean we should sit around like morons and let them rape us and drive our countries into the dirt..

You're being a bit melodramatic here, I think you're onto it though. We sit round like morons. WE.

The Government is the problem (also the morons who love our Govts) not corporations that owe no allegiance to nation states over and above the law. I've explained what they're about already. You could look into Corporate law in the country you are interested in, if you like.


The Banks MADE the system to justify their actions .

No they didn't, they had interests for sure, but they didn't sign the laws in.

[Sol Invictus]

For the Banks, yes it is. Government lets them get away with it, so until they change things status quo remains. Apart from those who do not carry out their job descriptions and those who under perform I have no problems with Bankers. .

Oh yeah, their just doing their jobs, creating money out of nothing that has no tangible existance outside the banks that exist as nothing but data. Meanwhile not one person in a hundred grasps the fact that our governments have all permitted private banks to create over 95 percent of our money supply bringing huge profits to them and endless debt to us.. But this is ok, because they say it's legal so we should do what we're told, right?

"It is well that the people of the nations do not understand our banking and monetary system, for
if they did, I believe there would be a revolution before tomorrow morning."

-Henry Ford, Founder & President of Ford Motor Company




You're being a bit melodramatic here, I think you're onto it though. We sit round like morons. WE.

If speaking realistically is melodramatic than I would have to agree with that..

Seriously, do some research before you're so quick to accept what you see on the nightly news..

You'll quickly change your way of thinking when they issue you IOUs instead of a paycheck..

[Grumpy Cat]

I guess to get the point across to some people on this forum who think that the banks and Big Business should not be blamed for this.

You know it was big business who pushed the whole multiculturalism and immigration. For years we were lead to believe that we needed immigrants to fill jobs when the Baby Boomers retired because they didn't have as many kids, but that is not true. Big Business were shitting themselves because the population was slated to drop, meaning fewer people to buy their products and take out loans from them (in case of the banks). To prevent this big loss of money they sent their lobby groups to push high rates of immigration on government. Immigration = more consumers = more money. These businesses even hire anthropologists to help them more successfully market their products to immigrant groups.

We could have handled an economic slowdown caused by a drop in the population. Japan fared pretty well in this regard. The slowdown would have been less painful than this current economic crisis.

[Atlas]

Global strike are pretty common in France, as the article says : typical frenchness. I haven't had much trouble going to work with the train so it was not the bigger strike in France since 20 years as they told to the medias.

[Æmeric]

We could have handled an economic slowdown caused by a drop in the population. Japan fared pretty well in this regard. The slowdown would have been less painful than this current economic crisis.


What matters to the individual is PCI (Per Capital Income) & as long as it is stable or increasing, taking into account inflation, there should be no problem for the individual. GNP (Gross National Product) is something else & this is where the national debt comes into play. You need people to continue paying the interest on the national debt, which is perpetual & is never intended to be paid off. This is what the immigrants are for. They pay the obligations the Western goverments have accumalated for social welfare promises over the decades & to maintain the market value of the treasury notes held by the various banks.

[Sol Invictus]

It's on record the elite w/ the Bilderbergs were planning to pop the sub-prime mortgage bubble to consolidate power.. When you read deeper into their publications they admit the super banks and the private shareholders in the private central banks are going to consolidate the majority of the thousands of independant banks and insurance companies that the central banks themselves loaned money to, but the money the central banks had to loan had supposed value.. those zeros and ones on a computer.. Because they're backed up by the credit and faith of the American people, for instance, and the huge imperial military, as well as the people in Europe.. New Zealand, Japan, and now China, and Saudi Arabia.. etc..

This is a massive war.. This is a massive economic war.. A war between mega elites, and through the crisis they create they scare the public into submission in saying 'Oh ok, we'll do whatever you say just fix the problem.. Just get me some jobs..Make sure the Terrorists don't get me.. just keep me safe.. And that's it..

This needs to be understood that this is completely and totally contrived, and the families that own the large foundations (you know who they are) that made their money tax-free for the last hundred years to protect their own wealth so they can have investments, land, real-estate, land-grabbing.. etc.. And now they are going to leave us holding the bag, and now we have to pay back all the fiat currency, and the fiat investments with the credit that was given to the private bankers and we don't only have to pay that back, taking it out of our hide, as if we ever could anyway, we have to pay them interest to give them our own money..

This is a Banker take over.. A criminal, brutal heist..

[Sol Invictus]

Every single year people have been talking about this and it is slowly starting to come out of the "conspiracy theory" phase and into what we call reality.. They are getting closer and closer to fullfilling their plan, they're tightening up the screws and we continue to fight back, as the French are, maybe they're giving ground a little bit and maybe we do, but I gotta tell you, to me, the perception is that they are slowly taking the high ground.. It's like a boa constrictor, when it wraps around it's prey and the prey breathes out before they get another breath in and it tightens up.. The people are waking up to their secret government, their shadow government and they are starting to question the propoganda more than ever, but unfortunatley the New World Order is accelerating their program of de-humanization and their 'endgame'.. Non of this is conspiracy theory, it is fact.. The globalist elite openly state in thousands of their documents, United Nations, biological diversity assessments, top professors at every major university say that they want a world government in place so they can forcibly have one-child policies, use global carbon taxes to regulate with social workers and over how big your home is, how you live your life etc.

They want to control even your thermostat in California electronically, you can't even touch it.. They've introduced the bill where they remote control it, and that's all well and good but once they set that precedent for total control then they are in there....

[Freomæg]

a) Debating whether it was the government's fault or the bankers' fault betrays a common naivety. The world's governments are bought and paid for by the elite banking families. The two are inextricable... once you take off that blindfold and take a peek behind the scenes that is ;).

b) Of course 'we have no choice but to bail out the banks'. The situation was orchestrated for precisely that reason - a heist which we can not only refuse, but one whose roots are so deeply ingrained that very few of us are even able to get our heads around why it is wrong.

c) The bailout does not represent 'Capitalism'. It represents a perverse form of Socialism. In a purely Capitalist system, the banks - as private corporations - should have been allowed to fail. What we've had is a Capitalist system while the going was good and there was profit to be made, and a Socialist approach as soon as the sh*t hits the fan. The corruption in that is glaringly obvious and such a situation requires that the government be under secret banker ownership, no less.

d) I don't want to hear rubbish along the lines of: "Sure, it's wrong but we have no choice but to bail out the banks. If we don't, our worldwide economic system is going to implode". Has the bailout helped so far? I'd rather have seen the system implode than the horrific future the bailout has set in place. Our children's children's children are going to be in debt up to their eyeballs because of this. Personally I'd rather rip the plaster (band-aid) off than suffer over the long term. Not to mention the justice seen in not handing trillions of dollars to a few wealthy families. By the way, do you really believe all of the bailout money is going to be put to legitimate use?

[Sol Invictus]

Exactly Cythraul.. Good to know everyone isn't a complete idiot around here..

[Sol Invictus]

I'm sorry, it just makes me so mad that all of this information is PUBLIC, and it's not like it's even hidden.. I just get so frustrated.. I don't mean to call any one an idiot but alot of people are just so happy believing what the news tells them on TV that they go on and call people ignorant for speaking out in favour of truth.. I don't think anyone here are idiots, except the one's who have the audacity to tell me that I am an ignorant fuck...

Seriously people.. Investigate Rockerfeller, Bliderberg IMF.. This is serious stuff and it's unfolding right before our eyes..

Please see this thread.. And WAKE UP
http://www.theapricity.com/forum/showthread.php?t=1939

[Treffie]

I'm sorry, it just makes me so mad that all of this information is PUBLIC, and it's not like it's even hidden.. I just get so frustrated.. I don't mean to call any one an idiot but alot of people are just so happy believing what the news tells them on TV that they go on and call people ignorant for speaking out in favour of truth.. I don't think anyone here are idiots, except the one's who have the audacity to tell me that I am an ignorant fuck...

Seriously people.. Investigate Rockerfeller, Bliderberg IMF.. This is serious stuff and it's unfolding right before our eyes..



Don't worry VA, I'm with you on this one. It's nice to know that there are other cynics out there who don't believe all the drivel that we're forced to swallow. :mad:

[SwordoftheVistula]

http://baltimorechronicle.com/2009/020109Lindorff.shtml

Key members of Congress were stunned to hear Federal Reserve Board Chairman Ben Bernanke and Treasury Secretary Hank Paulson say on Sept. 18 in a closed-door meeting on Capitol Hill that the country was “days away” from a complete financial meltdown-one that could lead to Depression-like runs on banks, widespread violence and ultimately even to a possible declaration of martial law. It was a vision of Armageddon, but, of course, 10 days later, the House rejected a Wall Street bailout package sent over by Paulson, only to pass one in a more limited form-the Emergency Economic Stabilization Act-a week later that gave Paulson less power and only half the money he wanted.

Meanwhile, the financial system did not collapse and while a few banks were failing, there were no runs on them, and martial law wasn't invoked. One reason things didn't fall apart when Congress didn't immediately act as Paulson and Bernanke demanded, may be that there wasn't any danger of a meltdown in the first place. So say three senior economists working at the Federal Reserve Bank of Minneapolis, who in October examined the Fed's own data, and concluded in an article titled Facts and Myths About the Financial Crisis of 2008 that the claims that interbank lending and commercial lending had seized up were simply not true. “Bank lending to consumers and to non-financial companies had not ceased, and banks were lending to each other at record levels,” says V.V. Charri, an economist at the Minneapolis Fed. “Maybe Bernanke and Paulson had information that they were not making public, but the available data simply did not support what they were saying.” Charri and his colleagues and co-authors Lawrence Christiano and Patrick Kehoe agree that with companies like Lehman Brothers, AIG and Citigroup foundering because of toxic debt instruments, there was a sense of a financial crisis brewing, but they say it wasn't a credit freeze. “This was a lot like the run-up to the Iraq invasion in 2003,” says Charri. “You had people in government saying: 'We're smart guys, trust us.' But they were either wrong or they were lying.”

Adds Kehoe: “Normally, when you're going to spend a lot of money, you present the data and the economic theory to support it, yet here's the biggest non-military government intervention in history since the Great Depression, and there was no evidence presented to support it, and no detailed economic argument made about what market failures this $700 billion was going to fix.”

Supporting that view, Octavio Marenzi, founder of financial technology research and consulting firm Celent, says more bluntly: “There was no credit crisis. What was happening was much more arcane: A few big institutions that had made bad bets were at risk of going bust, and that's it. And if they had gone bankrupt, it wouldn't have been the end of the world. In fact, there is huge excess capacity in financial services and there's a need to focus on the healthy ones and let others fail. Meanwhile, business lending and consumer lending were still strong in September and October, and it's still okay.”

Even in the corporate realm, there are some indications that all may not be as it appeared as the $700 billion Wall Street bailout was hammered out, followed by trillions of dollars more in government backing pledged for everything from corporate paper to money market funds to the Big Three auto companies. Bill Dunkleberg, chief economist with the National Federation of Independent Businesses (NFIB), says that over the years of routine business condition surveys conducted among members by his organization, which primarily consists of companies with sales of under $1 billion, only about 3% of financial officers have cited access to credit as their biggest problem. This November, the latest survey, which covered the period of the credit crunch and bailout, the figure was still 3%. Dunkleberg adds: “We also asked people who borrow every quarter if things had gotten harder for them or not; 11% said it had, but then that's about what happened in 1991, when the percentage saying that loans had gotten harder to obtain in that recession was 12%. So the situation is really pretty typical for a period when an expansion runs out and P&Ls get worse.”

No doubt things have gotten tougher for businesses, and obtaining credit has become more challenging. The question is whether it was necessary or even a good idea for the government to put taxpayers on the hook for hundreds of billions of dollars for a crisis that may have been overblown or mischaracterized, or whether all that money has been spent in the best way so as to address the crisis at hand.

“We haven't seen a freeze,” says the treasurer of a leading A-rated global international consumer goods company, who asked to remain unidentified. “Credit has consistently been available, but at a price. And I do imagine if you were a new credit customer going to a bank, or if you didn't have a good credit rating, you might have problems.”

Another treasurer at a global management consulting company based in New York City, who also asked to not be named, says his firm raised $500 million in debt last year. “But now things are tight. The kind of funds we could raise last year, we cannot raise now,” he says. “Even if funds were available, the credit spreads have widened significantly and the 'covenant-lite' era is a thing of the past.”

But that, argues Robert Higgs, an economist and senior fellow at the Independent Institute, a libertarian think tank, is just the point. In recessionary times, companies should be improving their balance sheets, not adding debt. “For the last five or six years, financial institutions have been lending irresponsibly, and companies and individuals have been making borrowing decisions based upon easy credit,” he says. “In a recessionary period, companies should not be trying to borrow; they should be de-leveraging.”

Higgs worries that by injecting staggering and unprecedented amounts of capital into the nation's banks, the government is encouraging a continuation of irresponsible lending practices, and is deferring an overdue correction that would adjust corporate balance sheets. “The Fed can print money and it can throw trillions of dollars around, but it just puts off the day of reckoning, and makes the inevitable adjustment in the future that much worse,” he says. Higgs was one of a group of 200 prominent economists who wrote Congress to oppose the Wall Street bailout.

Critics of the bailout are not just on the right. Liberal economist James Galbraith, a professor at the University of Texas, calls the credit crisis “more hype than real math.” He adds: “Calling the problems on Wall Street a credit freeze was a mischaracterization.”In Galbraith's view, Secretary Paulson's original proposal to have the Treasury Department buy up the banks' toxic securities, which was not implemented, was a bad plan. “Like trying to fill the Pacific Ocean with basketballs,” he says. And the actual action-the government's injecting capital into troubled banks by buying preferred shares-was only marginally better. He thinks backing the commercial paper market and extending deposit insurance to cover $250,000 per depositor made more sense, which the government also eventually did, though not with the bailout money. “I think belatedly they did some things right,” he argues.

So did the government bailout work? If keeping companies from going belly up, or preventing massive layoffs, or rescuing the mortgage markets, was the goal, as the Treasury Department, the Fed and backers of a bailout in Congress were arguing before passage, the answer is clearly “No.” Housing markets have continued to slump, even at an accelerated rate, unemployment has continued to rise, and more to the point, credit is still tight for all but the most credit-worthy borrowers.

Indeed, while corporate treasurers differ on whether they think there was a crisis that required a big bailout of Wall Street, most of those contacted, along with many economists, agree that borrowing money has not gotten appreciably easier for them following the injection of all that cash in financial institutions.

“Credit is still tight after the bailout for companies at the low end,” says Joanna Oliva, vice president and treasurer of Fluor Corp., an A-rated Dallas-based global construction firm. She says the tight credit situation, which she would not characterize as a freeze, did not really impact Fluor Corp., because her company had decided more than a year ago to reduce leverage. “We felt that the banks had been too loose about credit, and we were saying that a tightening was due, though I must say I never saw tightening accelerate so quickly.” While Fluor did not access credit markets this year, Oliva says: “We do have to be bonded on all our projects so we have been speaking with our banks about providing letters of credit and bank guarantees, so we have a sense of what's going on.”

That the recession may be more about contracting markets than about frozen credit was underscored by comments from the assistant manager at an auto dealership outside of Philadelphia, part of a regional family-owned multi-dealership chain. He said that the chain would probably be closing a few of its dealerships soon, as many dealerships are doing, but when asked if this was because of the credit crisis and potential car buyers' difficulty in obtaining credit, he laughed. “No. The local banks are happy to lend to customers who want a car loan, and to back our lending program,” he said. “But who is going to buy a new car when everyone's worried about whether they’ll have a job six months from now?”

Yves Smith, an economist and management consultant who operates a blogsite called “Naked Capitalism,” is skeptical about the Minneapolis Fed trio's thesis on the nature of the credit crunch, noting that the data it reviews is only what is on bank balance sheets. “A lot of lending, including bank lending, is off balance sheet.” she says, adding, “commercial lending and corporate paper are just part of the picture.” Noting that banks have been canceling unused consumer and small business credit lines and cards for the past year, she says, “It seems clear to me that there was a serious credit crunch.”

Charri and Kehoe don't deny that they were only looking at the 20% of lending that is reported to the Fed monthly, but Charri adds, “All we're saying is that based upon the data that is available there was no justification for the actions that were taken, and if there were really a freeze of other credit, the officials who were concerned should have shown the data to justify what was done.”

Adds Kehoe, “If what we're experiencing is a generic recession, all that money spent investing in the banks would be wasted, and that may be what this is: a generic recession.”

Smith though expresses concern that the bailout of the Wall Street's big financial institutions, using the so-called Troubled Assets Relief Program (TARP), which she argues was a bad strategy, may have “precluded other remedies” that the government needs to take. “With all the money that's already been committed, it is going to be hard to get the stimulus money that is needed now,” she says. “Deficits are already so massive that at some point interest rates on long bonds are going to jump from 3% to 5%, and that will be good-bye mortgage markets.”

Looking ahead, Smith offers some advice to corporate treasurers and financial officers. “Be very conservative and loss averse,” she says. “Financial crises take a long time to resolve, and this is a period when customers will be really slow to pay. Receivables will be bad. In general, even if the risks seem low, the downside these days could be catastrophic.”