Hank, Let Me Help You Help This Great Country: Michael Lewis

Nov. 17 (Bloomberg) --

To: Henry Paulson

From: Michael Lewis

Re: My TARP Funding

Dear Secretary Paulson:

First, allow me to explain that unfortunate incident the other morning in the Treasury men’s room. I failed to observe best practices.

Faced with a dozen empty urinals one should always put some space between oneself and a lone urinator. I took my place right beside you only because I hold you and everything you do in such high regard. If my whispered praise and steady gaze made you as uncomfortable as you appeared to be, I take full responsibility.

Also, please pass along my apologies to your colleague Mr. Kashkari for our recent encounter inside the Palm restaurant’s toilet stalls. My wide stance was inappropriate. I see now that my hand signal may not have been the best way to express my admiration for him -- a feeling I harbor for all those handing out bailout money. It was also wrong of me, as Neel flushed and fled, to refer to him as “Paulson’s Mini Me.” I spoke in frustration.

Now, on to the business at hand. In our brief exchange you asked a very good question: Who do I think I am, sneaking into the Treasury and asking you for $5 billion?

Other People’s Money

The short answer: an American businessman. Obviously, I’m not unique. Looking around I see many of my former fellow champions of laissez-faire -- everyone from boat dealers to bond insurers -- traveling to Washington to ask for their government’s assistance. Most of these people aren’t worthy of other people’s money, much less your precious time.

A former chief executive officer of Goldman Sachs Group Inc. does not mingle with boat dealers; he mingles with investment bankers; and the first rule, before handing out taxpayer money, is to have mingled with the people you want to hand it to.(That way they know whom they owe). I admire your ability to recognize your “circle of competence” and live within it.

Still, I do feel that in me, and my little literary business, there is opportunity for you, and your $700 billion. Allow me to explain why.

Be Fair

1) By giving the money to me, instead of someone less deserving, you will make the world a fairer place.

As much as I admire all of your decisions I can’t help but notice that the main qualification of the bankers to whom you have been giving money, so that they might make smart loans, is that they have gone almost bankrupt by making stupid loans.

As your mind is subtle, I can only assume that you secretly believe that the American economy right now needs not smart loans, but more stupid ones -- and thus that you have targeted the bankers who have proven they can make them.

I, unfortunately, have not flirted with bankruptcy, or made any stupid loans. But here’s my point: I haven’t been given the chance! Allow me to prove my financial ineptitude to you. I swear to you that when I return for my second round of assistance I will have proven myself fully qualified to receive it.

2) Unlike most of those vying for your affection, my business will do nothing to stifle growth or innovation.

Output Figures

By giving money to bankers who have made many stupid loans you have made life harder for bankers who have never made stupid loans. By aiding the dumb banks you prevent the smart ones from replacing them. It may be that just now smart bankers are the last thing we need -- but one day they may come in handy, and so we should do what we can to keep them from getting discouraged.

Here’s where I come in: I’m not a banker of any kind, but a mere writer. My little literary enterprise can absorb many billions of taxpayer dollars without consequence to the banking industry, or even to U.S. gross domestic literary output. If anything, other writers would have an opportunity to write more, as I, busy managing my new pile of cash, will naturally have no time to write.

3) Any funds you make available to me I pledge to put into circulation.

You have been disturbed, rightly, that the first $200 billion you handed out to the banks has seemingly vanished. The bankers who promised you they’d re-lend it have deceived you; I will not.

Eliminating Middlemen

If nothing else, giving the TARP money to me removes the unreliable middleman from the equation. Whatever of the first $5 billion I cannot spend myself, I will give to my wife and children, and maybe also to a dissolute uncle. You’ll be happy to know that we Lewises consume avidly but seldom shrewdly. When it comes to finding a bad deal -- good for the seller, good for America -- there’s really no one on the planet better than my wife.

4) I can help you in ways that even Goldman Sachs cannot.

You may think that you don’t need any more publicity than you have already received, but let me remind you that there’s more than one kind of publicity. There’s the article about you in the New York Times by some ungrateful journalist with no financial connection to you, over which you have no control. Then there’s the article by me about anything you want it to be about, anywhere you want it to appear.

You will be amazed by how little trouble it will be for you to come out looking “good” in one of my pieces. For a man of your stature, for instance, it can be hard finding the time to think up your own “quotes.” Not a problem! I can think up some for you. Any article I write would also be accompanied by photos of yourself looking many years younger than you currently do. You could have hair again, for instance, and an expression of total certainty.

So finally let me say my request to you comes not out of greed but patriotism. I ask not what my country can do for me, but for what my country can lend to me.

(Michael Lewis, author of “Liar’s Poker,” “Moneyball,” and “The Blind Side,” is a columnist for Bloomberg News. The opinions he expresses are his own.)

To contact the writer of this column: Michael Lewis at mlewis1@bloomberg.net