So much for administration spin about the effectiveness of TARP. Neil Barofsky, TARP’s special inspector general, deals the administration narrative a shot to the head. In effect, he tells Americans angry about the program they have a right to be:
…[M]any Americans to continue to view TARP with anger, cynicism, and mistrust. While some of that hostility may be misplaced, much of it is based on entirely legitimate concerns about the lack of transparency, program mismanagement and flawed decision-making processes that continue to plague the program.
“When Treasury refuses for more than a year to require TARP recipients to account for the use of TARP funds, or claims that Capital Purchase Program participants were “healthy, viable” institutions knowing full well that some are not, or when it provides hundreds of billions of dollars in TARP assistance to institutions, and then relies on those same institutions to self-report any violations of their obligations to TARP, it damages the public’s trust to a degree that is difficult to repair.”
Ya think? And you remember all the rhetoric about forestalling foreclosure? Uh, FAIL:
[T]he most specific of TARP’s Main Street goals, “preserving homeownership,” has so far fallen woefully short, with TARP’s portion of the Administration’s mortgage modification program yielding only approximately 207,000 (out of a total of 467,000) ongoing permanent modifications since TARP’s inception, a number that stands in stark contrast to the 5.5 million homes receiving foreclosure filings and more than 1.7 million homes that have been lost to foreclosure since January 2009.
Now, I’m not agreeing that any of that should have been done – this is about claims the administration and Democrats made for spending the money.
Question: where has the money really gone?
Oh, and you remember “spurring lending” as a key reason for TARP? Not so much. In fact, not much at all:
“TARP has failed to ‘increase lending,’ with small businesses in particular unable to secure badly needed credit. Indeed, even now, overall lending continues to contract, despite the hundreds of billions of TARP dollars provided to banks with the express purpose to increase lending.”
Meanwhile in the "moral hazard" department – success:
“…[I]ncreased moral hazard and concentration in the financial industry continue to be a TARP legacy. The biggest banks are bigger than ever, fueled by Government support and taxpayer-assisted mergers and acquisitions. And the repeated statements that the Government would stand by these banks during the financial crisis has given a significant advantage to the larger “too big to fail” banks, as reflected in their enhanced credit ratings borne from a market perception that the Government will still not let these institutions fail, although the impact of this cost may be blunted by recently enacted regulatory reform.”
Almost a trillion dollars and they really don’t know where it has gone. Additionally, they’ve not at all achieved the goals for which they tried to tell the public this money was so damned important.
Lack of transparency? Mismanagement? Flawed decision-making? Why weren’t those things included in the administration’s spin.
And we just let them take health care from us as well.
Some conversation starters:
- For new readers, the title is what the shortened “QandO” means.
- I’m constantly amused by the anecdotal evidence I gather while on the road that says if you’re over 65 you have to drive a Buick.
- One thing to keep in mind as you listen to all of these proponents tell you that government can do health care better than the private sector – The private sector is a net producer of wealth. The government sector is a net consumer of wealth. That’s why the more of the economy a government takes over the less wealth is produced and thus available within the economy.
- Interesting chart showing the level of spending in the last 12 months compared to the spending over the last 206 years in inflation adjusted dollars. How do people believe that such a massive increase in spending doesnt have to be paid for at some point?
- Is Obama’s honeymoon over? Is enough resistance building to derail some of these economy killing policies and programs now on the table?
- Former President Bush speaks out, apparently tired of a president 150 days into his own administration continuing to blame the previous administration. Appropriate or should he remain silent? And interestingly, since the left excused Jimmy Carter’s criticism of the Bush administration, does that mean they’re fine with Bush speaking out?
- Is it “IGgate”? What’s up with this story about the Americorps IG and are there more IGs with whom the administration has messed? Wasn’t this the administration which was going to “return” us to the “rule of law”? Why aren’t they following it?