June 5, 2009
Linda Beale over at ataxingmatter recently posted a report she calls TARP Lifting? transparency, not secrecy, needed. In her post she points out something that I have reported on at least four times this year, the first being in early March. It concerns the TARP money, and banks receiving other money from the Federal Reserve. (Although not mentioned by Beale, banks are also getting back-door money from the FDIC.) In my posts (listed at bottom) I addressed the reason why banks want to pay back TARP, and how their public relation organization(s) are waving the “Let Me Pay Back TARP” flag for them.
During the House Budget Committee meeting this week, Federal Reserve Chairman Ben Bernanke read his usual long report then answered some questions from the committee (If you missed it, you can read a transcript of the meeting here). One of those questions came from Representative Lloyd Doggett. Leading into his question, Doggett, as most committee members do, gave his comments, which pertained to the “back-door” money being handed out to banks. (I find it ironic that Doggett used the term “back-door” which I’ve used in all my related post.) The following is part of Doggett’s lead-in comments, which I’ve “borrowed” from Beale’s post, which she obtained from a Doggett press release.
- Ø While the $700 billion financial bailout that congress approved last September has been the subject of public scrutiny and debate, the Federal Reserve is apparently committing three times as much public money [bold added] through its emergency lending powers. This use of expansive emergency powers relying on a vague statutory provision that hasn’t been used in almost 70 years is not normal.We need to shine a light of transparency on this process, and we must do it now because the confidence of the American taxpayer, our public debt, and our economy are at stake. While independence and secrecy may be important to the Fed’s normal operations, we need a canary in the coal mine. (Watch the video of Doggett’s question and Bernanke’s answer, where Doggett uses the term “back-door”)
In case you have not stayed close to this issue, several banks have stated they have petitioned the government (Treasury Secretary Tim Geithner) to pay back some, if not all, of the TARP money. This has been the topic of many discussions on news shows and business talk shows. Inevitably, these people, including the banks, have lambasted the government for not letting them pay back the TARP money — “all we want to do is return the money to the taxpayer”, they say. But that is far from the truth. The real truth lies right before our eyes, and is as obvious as fireworks on a 4th of July night if we are willing to open our wide shut eyes.
Although not part of the original conditions attached to TARP funds (there were none — just ‘take the money and run’), our lawmakers, responding to public outrage, started attacking banks that were still handing out un-godly and undeserved salaries and bonuses to CEO’s and other high-ranking employees, of which most, if not all, were responsible for the financial travesty. And the public pressure has remained high enough to keep government officials from letting up on that. So these bankers, not willing to permanently give up their acts of thievery, started devising a way to divorce themselves from any sort of government control. They accomplished this by soliciting their friends, Federal Reserve chairman Ben Bernanke and FDIC chairman Shelia Bair (among others), and got them to open up the back door to their respective house of horrors. Now that enough unconditional money has been hauled out, these bankers no longer need the TARP funds. Therefore, they want to use part of their 2nd and 3rd sources of money to pay back the 1st source so they can return to the ‘good ol’ days’ of pillaging while still being supported with taxpayer money. Period, dammit!!
Simply by being a Democrat, Representative Doggett is (and will be) considered by many to be a member of ‘the most evil club on earth’. But we common folks should be blind to his party membership, most especially on this matter. Doggett has been a lead spokesperson for us regular folks on this bailout matter, without using it for a self-serving purpose. From the very beginning, he’s been asking the tough (and right) questions concerning the proper use of our money. You can watch this video this one where he questioned Bernanke in past committee meetings.