(This is an Op-Ed)

Why does the federal government always do favors for multi-millionaires with connections, but next to nothing for everyone else?

Proposing legislation to strengthen banking regulations, Senator Richard Blumenthal, D-Connecticut, stated, "It's not a bailout as happened in 2008"

That was one of the worst years average American citizens were stuck for highly unpopular bailouts of large financial institutions, not to mention how those failures tanked the economy.

Blumenthal further stated, "It is [and here is the key point] in effect, protection of depositors and a preventive measure to stop a run on other banks all around the country."

The Collin's dictionary defines the word bailout to mean "banks use money from depositors to help avoid failure and bankruptcy."

Can you smell bailout?

While in the short term taxpayers may not bear any direct costs for the failure of Silicon Valley Bank and Signature Bank, which happen to be the second and third largest bank failures in US history, in the long run the higher costs banks that help defray the expenses of covering uninsured deposits of these two failed banks will inevitably be passed on to those helper banks' customers. This will force the average American citizens to pay more for those banks' services.

Sugar-coat the wording any way Blumenthal wishes, the end result is once again "can you smell bailout?"

According to the Federal Reserve, helper banks have already borrowed more than $300 billion in emergency funds. Half of that has gone to holding companies of Silicon Valley Bank and Signature Bank to pay their depositors. This is money the helper banks are required to repay the Federal Reserve.

Though it could take several months to be fully felt, the average American citizens' bailout of these two failed banks has already commenced.

According to the FDIC, the Federal Reserve, and the Department of the Treasury, "The insurance fund [that reimburses depositors for up to $250,000 per account with fees paid by other banks] will be replenished by a "special assessment".

The costs associated with that assessment will ultimately be borne by those helper banks' customers. It is not clear at the moment how much money could be involved.

Let's all say the word together, "bailout."

The FDIC, the Federal Reserve, and the Department of the Treasury issued this joint statement, "No losses associated with the resolution of Silicon Valley Bank will be borne by the taxpayers."

Conspicuously absent was any statement about those losses associated with Signature Bank's failure.

Just where do the FDIC, the Federal Reserve, and the Department of the Treasury think this money for these bailouts will eventually come from? Perhaps magically grow on trees? Santy Clause? No, do not fool yourself, it will come from where it always does, the pockets of the average American citizens.

Isn't good financial management of banking institutions about doing whatever is required to stop the kinds of pestilences that sank Silicon Valley Bank and Signature Bank before the average American citizens are forced to bail them out?

You didn't ask...but.