I know many of you have seen these two diaries featuring a rant about the $3.7 Trillion we are spending on TARP
http://www.dailykos.com/...
And
http://www.dailykos.com/...
I would normally let the rants go, but the overly simplistic interpretation of 1 page of the report which is over 280 pages is just too much for me not to correct the record...
http://www.sigtarp.gov/...
The referenced quote is on page 5...I would encourage all Kossacks who like to get to the whole truth to read past page 5 of this very interesting and informatonal report...(BTW when I cite page numbers it is the page number on the report not the PDF page number on your screen)
So before I begin, I do want to make sure everyone understands, that other pieces of the above referenced diaries may be completely true but the assertion that we are somehow hampering our spending because of some $3.7 Trillion dollar committment is just not based in reality...
So that is the focus of this diary...
So lets start out with what is the Special Inspector General Troubled Asset Relief Program (SIGTARP) report really is...and again for the record, I will be referencing page numbers and paraphrasing sections since the PDF is protected from copying text...
Well we should start with SIGTARP's mission: (Page 2)
...to advance economic stability...through transparency...coordinated oversight...and enforcement against....waste, fraud or abuse of TARP funds.
Essentially they are internal auditors and investigators to make sure TARP is being spent wisely and without waste fraud or abuse...in essence their job is to find stuff that is wrong, bring it to the attention of the appropriate authorities and report to Congress on their findings and recommnendations...
For June 30th, 2010, they compiled a 282 page report which has a lot of information about what SIGTARP monitored, found and recomend as well as TARP and the related programs status...and they are critical of some areas of TARP...as they should be...but the vast majority of this report as you will see is really quite positive in nature...
So lets start where the $3.7 Trillion figure comes from (Page 5 2nd paragraph)...
The actual expenditures and garauntees...increased from $3.0 Trillion to $3.7 Trillion over the past year...
Sounds really bad, right...well if you stop reading on page 5...that could be your conclusion, but lets keep on reading...
Well on page 6 there is a handy table which breaks down the changes...$0.2 Trillion of the change is due to an accounting change not an actual increase in authority...
The vast majority of the remainder of the increase was in mortgage garauntees, which we can go into detail later on...
Now lets move on to page 8 that begins to explain about the 13 programs and their respective statuses...
So this is where the report talks about actual dollars appropriated and spent on the programs...
Here are the highlights on page 8
- TARP implemented 13 programs of which 7 are already ended or closed
- TARP has actually expended only $386.2 Billion through June 30th ($498.3 Billion committed)
- 87 TARP recipients have paid back $201.5 Billion and released TARP from $5 Billion in liabilities
- TARP has received $15.7 Billion in interest/dividends and other income
- TARP has received $7 Billion from the sale of warrants
- As of June 30th, the TARP recipients were behind on a total of $157.7 Million in dividend payments (about 1% deliquency on $15.7 Billion collected)
Not too bad so far...lets continue reading to dig into the $3.7 Trillion number...
Page 13 has a summary of the recommendatons to TARP, which are good recommendations and should be followed...
Page 18 & 19 details a fraud investigation that is leading the "banksters" to trial...because of the great oversight of SIGTARP...
Now we get to the fun part starting on page 35...SIGTARP's evaluation of how TARP is doing...
Overall, great! The original estimate of the cost of TARP was $341 Billion and now the current estimate is $105 Billion!...simply amazing and this makes this bailout even if no more improvements and profits are realized the lowest cost bailout in modern history...
On page 37 the report talks about the 7 programs that have been ended in record time...
- Capital Purchase Program (CPP) - Buying Stock or Debt in Financial Institutions to boost their capital (Page 39)
- Capital Assistance Program (CAP) - Part of CPP
- Targeted Investment Program (TIP) - TIP was primarily the Citigroup deal (Page 40)
- Asset Garauntee Program (AGP) - Primarily garauntees on CDOs (mortgage backed securities) to provide liquidity in the markets(Page 40)
- Term Asset Backed Loan Facility (TALF) - Primarily to provide liquidity to credit markets for smaller loans (Page 41)
- Auto Supplier Support Program (ASSP)
- Auto Warranty Committment Program (AWCP) - To save 2 of the 3 US automakers from bankruptcy (pp 42 - 43)
Figure 2.3 on page 48 is a wonderful graphic that shows the progress that this successful program is having about winding down its participation in the capital markets in this country...
It shows we peaked our expenditures in November 2009 and have been winding down ever since in an orderly fashion...
From Page 54 to Page 96 there are detailed descriptions of the programs and what funds they have expended and their status...I think you would find there is a lot of money going to people other than banksters...
Finally on page 118 Table 3.1...remember when everyone was worried about the $23.9 Trillion in liabilities the US government was taking on...well lets say for a minute that $23.9 Trillion was a theoretically real number...if that is the case, then going from a high of $23.9 Trillion to $3.7 Trillion in less than a year whoever figured that one out should not be villified...they should be thrown a ticker-tape parade...at this rate by next year the total liability will be near zero!!!
(Page 118)
Thanks President Obama and Secy Geithner for your great leadership on this terrible problem you inherited and keep up the good work!!!