Someone’s Lying About the Bailouts
From a 23 Dec Treasury press release “Taxpayers have already received over $16 billion in profits from all TARP programs and that profit could be considerably higher as Treasury sells additional warrants in the weeks ahead.” The text is a bit scrambled in the Treasury link, but the quote is there.
From a Reuters article covering new fees being considered for banks “The fee could be included in Obama's budget proposal for fiscal 2011 to help recover some of the taxpayer money used to bail out banks during the financial crisis, a senior administration official said on Monday.”
Emphasis added to both quotes.
Which begs the question, if taxpayers have received $16 billion in profits, hasn’t the taxpayer money used to bail out banks already been recovered and then some?* Which is it Sec. Geithner and President Obama? Did TARP make a profit on the banks or not? Which one of the statements above is untrue? Or did the reporters get the story wrong?
Unfortunately, none of the journalists covering the story for Reuters, the Wall St. Journal, New York Times, et. al. saw fit to follow-up on the contradiction.
Just in case there isn’t enough inconsistency yet, according to the Reuters article the administration is considering exempting AIG and the automakers from this fee. Yep, the companies most likely to cause a big loss to TARP might get excused from the fees intended to make up for those losses.
Once again, some pigs are more equal than others.
*I'm pretty sure the TARP legislation allows the gov't to look into and assess fees to recover TARP losses, but I don't think that authority extends to losses from other pieces of the bailout like Fed rate subsidies or FDIC loan guarantee programs.