Five Things: Taxpayers Screwed Again; Nation Shrugs
The Treasury seriously overpaid for bank stocks. What else is new?
Here's an unsurprising surprise. It turns out the Treasury Department under former Treasury Secretary Henry Paulson overpaid for bank stocks under the Troubled Asset Relief Program (TARP).
Elizabeth Warren, a Harvard law professor and head of an oversight panel for the bailout, told Congress on Thursday that the Treasury paid $254 billion in 2008 to financial institutions through the TARP program but received only $176 billion worth of stocks and warrants.
Back in December, the oversight panel asked Paulson to value taxpayers' return on the "investments." Paulson told the panel the "investments" were made "at or near par," according to Warren. That would mean taxpayers received about a $1 stake for every $1 "invested" in the banks. However, the oversight panel "found otherwise," Warren told Congress. Far from being $1 for $1, the actual value $0.66 on the dollar, the panel discovered.
Ok, so what does all this mean? The doleful truth: It means absolutely nothing.
2. Flashback I
Shrug away, friends. Still, it takes an awful lot of whiskey to chase away the foul taste of a politician's bald-faced lie. On October 20, 2008, then-Treasury Secretary Paulson had this to say about the TARP:
"This is an investment, not an expenditure, and there is no reason to expect this program will cost taxpayers anything."
3. Flashback II
Here's another flashback. It's 2004, and you're sitting in a film producer's office pitching a screenplay. The Manchurian Candidate and The Parallax View meet The Stepford Wives, with a little Soylent Green thrown in. The producer leans forward. "I'm intrigued. Go on." So you deliver the full pitch:
In the not-so-distant future, a cabal of economic elites who control the nation's banking and credit systems conspire to destroy the structure of the financial system, so they can transfer vast amounts of taxpayer funds to themselves through government assistance programs set up to "rescue" the very financial system they destroyed.
The producer interrupts. "Let me stop you right there," he says. "It's too conspiratorial. Too farfetched."
Yes, fast forward to February 2009, and -- other than the fact it's precisely what's happening right now while we sit around watching -- it is a bit conspiratorial and far-fetched, I suppose.
P.S. If anyone wants to option the screenplay, just drop me a line.
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