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Why the Bank Bailout was, is,and will continue to be - a fucking joke:

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Political Heretic Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jul-20-09 04:42 PM
Original message
Why the Bank Bailout was, is,and will continue to be - a fucking joke:
Try to remember this if you can - I know it was a long time ago, but the entire point of the 700 billion dollar bank bailout known as TARP was to increase bank lending to thaw the freeze in credit.

It was designed on Bush's watch, but funds have continued to be deployed without any changes to the basic provisions of TARP under Obama, who supported the bailout and voted for it (instead of, for example, arguing for a real solution that would actually fix broader economic ills rather than simply re-inflate our bubble economy and make banks filthy rich.)

Again, TARP was created with the goal of unfreezing credit and getting banks lending again. That's what our taxpayer money was supposedly for. Instead, here's how it actually works:

From Propublica, one of the best (and possibly last) serious independent investigative journalism organizations around, who pay special attention to tracking stimulus spending and TARP money:


How Banks Are Using Bailout Money
by Karen Weise, ProPublica - July 20, 2009 10:56 am EDT

TARP funds <1> were supposed to help banks increase lending, but many bailed-out banks used federal funds for other purposes <2> says the special inspector general for overseeing TARP <3> in a report <4>(PDF) released today.

According to the inspector general, of the 360 banks surveyed, 156 said theyd used some of the funds to boost their capital cushion, 110 invested some of the money, 52 repaid debts, and 15 bought other banks with the funds. (A total of 611 banks have received bailout funds.)

Three hundred banks, or 83 percent of those surveyed, reported that some of the money had gone to support lending, but fewer than a third said their lending levels would have been lower <5> without the federal money.

Neil Barofsky <6>, the special inspector general, said the Treasury Department should require banks to report how they use TARP funds. Currently, Treasury

does not require banks to track TARP spending,

nor do banks need to keep TARP funds in separate accounts.

There are also no consequences for using funds for purposes other than spurring lending.



http://www.propublica.org/ion/bailout/item/how-banks-ar...


There is no reason - none - not to include any sort of regulation or accountability for the money, unless your goal is to simply transfer wealth upward to the financial elite. Whether Obama was aware of this or just too incompetent to understand the failures of TARP and do something about it, the effect is the same: this giant give away of tax payers money continues, and much of the money is being misused and mishanded.

What is the effect of this? Part of the effect is Unemployment breaking 10% when the administration was only predicting 8%. With credit still not flowing as freely as it should, and banks under no obligation to use TARP money in the way was intended, small businesses aren't able to get their businesses back in the black or hire.

I said all of this clear back before TARP passed. And exactly what I expected has turned out to be true.
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RUMMYisFROSTED Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jul-20-09 04:46 PM
Response to Original message
1. Regulation?
:rofl:


Pithy but true.
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wtmusic Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jul-20-09 04:51 PM
Response to Original message
2. Kudos, PH
But to all the Chicken Littles the sky was falling, and as usual fear ruled the day.
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groovedaddy Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jul-20-09 04:55 PM
Response to Reply #2
3. But many on both sides of the aisle questioned it. n.t
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wtmusic Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jul-20-09 04:57 PM
Response to Reply #3
4. More Republicans questioned it and we should be ashamed
to his credit my rep (Brad Sherman) finally took a strong stand on something and spoke out against it.

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truedelphi Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jul-20-09 06:53 PM
Response to Reply #4
8. Grayson (D) from Florida has been amazing
Edited on Mon Jul-20-09 06:53 PM by truedelphi
And the ususal suspects - Kucinich, Maxine Waters, Issa, (Though he is Republican.) Plus Lynn Woolsey is coming around. (You can do it, Liz - if you could stand off RW hatred in order to object to the IWR, when almost no one else would, you can certainly take on this financial menace.)

Bernie Sanders has been amazing also.


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Kid Dynamite Donating Member (307 posts) Send PM | Profile | Ignore Mon Jul-20-09 07:30 PM
Response to Reply #8
12. Grayson is more consumed
with the financial scam he was a "victim" of..although the money "lost" was actually insanely unrealistic interest not earned. Somehow I think there are crocodile tears involved when one "loses" half of their net worth -- 30 some odd million dollars -- in this way.
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truedelphi Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jul-20-09 08:21 PM
Response to Reply #12
14. Did not know that. But it is a bit irrelevant why someone is
Upset - what we need are a whole lot of people equally outraged and who will work to put this corrupt system out of its miserable parasitic life.

JFK was upset with the CIA and military because they dicked with him and cost him a small portion of his reputation over the Bay of Pigs.

Thankfully, because of that outrage - he refused to indulge in nuclear war at the Generals' suggestion during the Cuban Missile Crisis.

I am someone more interested in outcome than the purity of someone's motives.

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Kid Dynamite Donating Member (307 posts) Send PM | Profile | Ignore Mon Jul-20-09 08:42 PM
Response to Reply #14
15. Having that much money tends to be like having Viceroy in front of your name
doesn't tend to generate much "motivation" when it comes to putting the system out of business and you can guess the outcome

Not sure what the Kennedy example gets at it
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bvar22 Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jul-20-09 05:41 PM
Response to Original message
5. Be very afraid.
These same people are now in charge of Health Care Reform.
They are going to give us something they call a "Public Option".

Here are some of things you should know about the recent House Bill (HR 32000):

*ONLY 10 Million Americans will be covered by the Public Plan by 2019.
Big Insurance should be very happy.
With the MANDATE for ALL Americans to purchase Health Insurance, and only 10 Million in the Public Plan after 10 years, they will be raking in the money.

If the Public Plan only enrolls 3% of Americans, will they have any negotiating power to "drive down Health Care Costs"?


"Most importantly, the CBO coverage tables undermine the conservative claim that a public option would eliminate private insurance and erode employer-sponsored coverage. The House bill actually increases the number of people who receive coverage through their employer by 2 million (in 2019) and shifts most of the uninsured into private coverage. By 2019, 30 million individuals would also purchase coverage from the Exchange, but only 9-10 million Americans would enroll in the public option, the rest would enroll in private coverage."

http://wonkroom.thinkprogress.org/2009/07/14/house-bill... /




*Health Insurance will be mandated for all Americans, but Providers will be able to refuse Public Plan Participants.


Provider participation is voluntary Medicare providers are presumed to be participating unless they opt out."


*The Public Option "should" be about 10% cheaper than Private Insurance.
I guess that is something, but a Publicly Owned Government Administered Plan that is open to ALL Americans could cut costs by at least 25%. (Difference between Medicare and Private Insurance administration).



*Many that are receiving Employer Based Insurance will be locked out of the "Exchange" and forced to keep their more expensive insurance.

"Under the main health bills being debated in Congress, many people with job-based insurance could find it difficult to impossible to switch to health plans on a new insurance exchange, even if the plans there were cheaper or offered better coverage. The restrictions extend to any government-run plan, which would be offered on the exchange.

<snip>

But critics argue that the rules run counter to suggestions from health care reform advocates that an overhaul could provide people with a broader choice of insurance options. The rules, they say, could be especially unfair to some lower-income workers who are enrolled in costly job-based insurance. Also, they argue, the restrictions would hurt the proposed public plan by limiting enrollment."

http://www.newjerseynewsroom.com/healthquest/for-many-w...


There are many other details that need to be examined, but the one MOST glaring is the prediction that ONLY 10 Million will be enrolled in the Public Option by 2019. That is minuscule compared to what America is demanding.

Do you believe that the 72% of Americans who are calling for a "Public Option" will be satisfied with this?
OR is this just more "3 Card Monty" that they played so well with the Bank Bailouts?

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Greyhound Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jul-20-09 07:43 PM
Response to Reply #5
13. I'm dealing with our so-called health care system right now, and I am.
I am have two relatives being put through this fucking meat grinder and it is all I can do to avoid violence in dealing with these unconscionable assholes.

Oh and BTW, both of these relatives have what is described as top-of-the-line insurance and both of them have unquestioned need.
:grr:

The very idea that there is even one republik-in-Democratic-clothing fighting real reform just makes me want to :puke:


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inna Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Jul-21-09 03:19 PM
Response to Reply #5
22. O_M_G. this SO deserves its own thread. please, please post this as a separate thread.

and thank you so much for the info. i'm somewhat shocked, but... your post clarified a lot. :(
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glitch Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-22-09 09:57 PM
Response to Reply #22
29. What inna said. Do it bvar22! nt
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slipslidingaway Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-22-09 01:50 PM
Response to Reply #5
27. kick n/t
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maryf Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-22-09 02:01 PM
Response to Reply #5
28. Yes please post this as your own OP!
Thanks so much!
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blindpig Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jul-20-09 05:56 PM
Response to Original message
6. It has been nothing but a giant scam.

Social Security next, I wonder if people will notice?

k&r
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truedelphi Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jul-20-09 06:50 PM
Response to Original message
7. Don't forget - one hundred thirty five BILLION is missing
Not that anyone anywhere should get cncerned about that or anything.

Especially not if they are powerfully placed inside government and might have a way to bring TARP to some oversight.

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chill_wind Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jul-20-09 07:14 PM
Response to Original message
9. Indictments can serve as great deterrents. (Barofsky, April 2009)
Ultimately, if all we did was sit back, wait for fraud and then try to address it there would be a tsunami of fraud, he said. The most drastic weapon is clearly primed for use:

Mr Barofsky said he was investigating whether banks had cooked their books to get some of the $700bn (540bn, 475bn) in Tarp fund bailout money. He declined to go into specifics but said possible criminal offences included securities fraud, wire fraud, false statement.

http://dailybail.com/home/tarp-inspector-neil-barofsky-...


I really, really wish these two were switched around in their authorities:


Earl Devaney:

IG of Abramoff Fame
Oversees Stimulus Spending

http://www.propublica.org/article/ig-of-abramoff-fame-t...
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Kid Dynamite Donating Member (307 posts) Send PM | Profile | Ignore Mon Jul-20-09 07:19 PM
Response to Original message
10. What is the total exposure?
How many trillions will this end up being? That question does not seem to have an answer (unbounded?)
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waiting for hope Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jul-20-09 07:21 PM
Response to Original message
11. K&R - and the fact that
a third stimulus package is being talked about is downright scary and a slap in the face to everyone else not involved with Wall Street. And it's not just getting the business back in the black or having them hire, how do they account for the ones that have gone under with no chance of reviving?


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KakistocracyHater Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Jul-20-09 08:51 PM
Response to Original message
16. they bailed out the wrong end, should have stopped foreclosures
communities would have a better time just trying to create jobs, now so many are homeless & mayors no where are providing porta-pottys, think about the health implications of this. No access to clean water, bathing/shower facilities, the homes being stripped of copper, vandalized, prostitutes working in these foreclosed houses.....It's a madman's paradise.
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NoUsername Donating Member (265 posts) Send PM | Profile | Ignore Mon Jul-20-09 08:59 PM
Response to Original message
17. Thank God it passed!
:evilgrin:
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chill_wind Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Jul-21-09 10:44 AM
Response to Original message
18. kicking.
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Political Heretic Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Jul-21-09 12:15 PM
Response to Original message
19. kick.
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mullard12ax7 Donating Member (500 posts) Send PM | Profile | Ignore Tue Jul-21-09 02:37 PM
Response to Original message
20. I hate reality, let's just go join the cheerleaders! Accomplishments!
Just like "Mission Accomplished"! He bought a puppy! So what if Americans are now tools for a criminal banking system which guarantees there will be no recovery, let's just pretend it's all so wonderful in happy-land!
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maryf Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Jul-21-09 03:06 PM
Response to Original message
21. K&R
good job, ph.
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inna Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Jul-21-09 03:27 PM
Response to Original message
23. IN-SANE in the membrane. it makes me want to pound my head against a wall.

:banghead:


:grr:



:mad:



HOW and WHY are we letting them get away with this crap??? are we totally sheeple??


:banghead:
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tbyg52 Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Jul-21-09 05:46 PM
Response to Original message
24. >>TARP was created with the goal of unfreezing credit and getting banks lending again
So they *say*. I don't think BushCo ever had that intention at all. I think it was just a money grab, for them.
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Union Yes Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Jul-21-09 06:09 PM
Response to Original message
25. It's quite simple. We'll regret squandering the opportunity to nationalize banking.
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Political Heretic Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-22-09 12:28 PM
Response to Original message
26. one last kick, then I have it out of my system. Thanks for all the thread support on this.
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