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It's an inconceivable idea. After years of Republican bashing of the scheme that George W. Bush cooked up, and Obama had to reinterpret to put some curbs on a Wall Street Giveaway, the Troubled Asset Relief Program (TARP), with the Obama amendments, has worked.

74% of the money has been returned to the Treasury, along with billions in interest and billions more in stock options that the Government still can cash in on. With AIG's stock sale coming up shortly the returned amount will be closer to 80%.  Considering that institutions under TARP had until 2017 to repay, the program is well ahead of schedule.

Democrats should be touting TARP. Mr. Obama saved the economy by putting the limits on the program and requiring serious change in the boardrooms of places like GM and Citigroup.  The media, which blew the numbers way out of proportion back in 2008, also owe a few features, if not an apology, for blowing it that badly. For my complete take, see my personal blog by clicking on the graphic for "Sorry, Republicans. TARP Worked."

Sorry, Republicans. TARP Worked

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Comment Preferences

  •  Tip Jar (6+ / 0-)

    Stop totalitarianism in the United States before it's too late. Speak truth to power! - Join me at truth-2-power.com

    by Brian Ross on Sun May 29, 2011 at 08:52:44 AM PDT

    •  And the (5+ / 0-)

      GM/Chysler salvation programs worked also.

      I know a lot of folks on here would have preferred to let the banks go down,or be nationalized,but can you imagine the outcome if we had let a dozen Lehman Bros. go ahead and nosedive?

      I agree with folks that it sucks that we have yet to really expose and punish those who caused the near-meltdown of the world economies,but in crisis management you have to first save as many of the masses as you can,then start sorting out the guilty parties.

      Call me a centrist,whatever, but I remember the pain of my aunt when a good chunk of her retirement savings from a lifetime of farming with my deceased uncle disapeared with Lehman Bros. Multiply that time 100 million and you have the alternative option that some seem to embrace.

      The economy is still not good,but the alternative was far worse,like 25-30% umemployment,and middle class retirees savings wiped out completely.

      The 2012 campaign for the President  and the dems needs to distill all the info down to a simple theme,which should include reinforcing how his cool,steady leadership guided the USA thru the worst of times,with intelligence and compassion.

      •  "We have yet to really expose and punish (1+ / 0-)
        Recommended by:
        Gary Norton

        those who caused the near-meltdown of the world economies"? More like, we've rewarded them and put them back in business....there's no hint of any willingness to ever "punish" them. In fact, we're even continuing to cut their taxes.

        While it's true that some kind of bailout was necessary in the short run, the handling of this crisis is nothing to be proud of. Unemployment is disastrously high and the system remains vulnerable to bubbles.

        "All governments lie, but disaster lies in wait for countries whose officials smoke the same hashish they give out." --I.F. Stone

        by Alice in Florida on Sun May 29, 2011 at 11:52:37 AM PDT

        [ Parent ]

        •  Mixed bag (0+ / 0-)

          In some cases, the people who ran those corporate boards are gone. In others, such as Goldman, they are not.  The GM corporate culture got a clean sweep. Citigroup did not.

          Unemployment is high, but not "disastrously" so. It would have been far worse without TARP, that is certain.

          Stop totalitarianism in the United States before it's too late. Speak truth to power! - Join me at truth-2-power.com

          by Brian Ross on Sun May 29, 2011 at 11:57:27 AM PDT

          [ Parent ]

          •  Of course it would have been worse (0+ / 0-)

            without TARP...but that's not saying much. As for what makes unemployment "disastrous"....a lot depends on one's individual situation (always easier to bear if you're still employed). But what makes it "disastrous" for me is that it's not going down significantly, and is not expected to go down significantly. For young people struggling to get their first job and middle aged people who lost jobs and are struggling to hold on until they can get Social Security, it's a disaster.

            Of course for those with substantial stock portfolios, TARP an unmitigated success....not that they'd ever admit it. The fact is, TARP has worked best for those least in need. And as for those who ran corporate boards being "gone"....they are essentially interchangable. Some of the f###ups have gone onto a very comfortable retirement, but the f###up business goes on, and the bonuses are as big as ever.

            "All governments lie, but disaster lies in wait for countries whose officials smoke the same hashish they give out." --I.F. Stone

            by Alice in Florida on Sun May 29, 2011 at 02:20:09 PM PDT

            [ Parent ]

            •  Uh, Alice... (0+ / 0-)

              Everything works best for those least in need.  Did you not do well in history in school?  Rome. Feudal Europe. The early Industrial Age.  The Reagan/Bush Era.   The meek may inherit the Earth, but only when the spoiled rich f**cks are done with it, darlin'... Oh, and they ain't done. Nossir.  Just ask the Koch Brothers.

              Stop totalitarianism in the United States before it's too late. Speak truth to power! - Join me at truth-2-power.com

              by Brian Ross on Sun May 29, 2011 at 08:55:04 PM PDT

              [ Parent ]

  •  You can't be serious. (1+ / 0-)
    Recommended by:
    nippersdad

    Worked in what way?

    Better yet: what is your interpretation of what TARP was meant to accomplish?

    Perhaps that's a starting point for a more accurate discussion of the matter, which this diary seems to completely avoid...

    More and Better Democrats

    by SJerseyIndy on Sun May 29, 2011 at 09:19:43 AM PDT

    •  TARP, along with the Fed and SCAP provided (2+ / 0-)
      Recommended by:
      Actuary4Change, Gary Norton

      liquidity when the credit markets were frozen.  Even McDonalds has to borrow to make payroll and needs credit to do so.  This country runs on credit.

      "The way to see by faith is to shut the eye of reason." - Thomas Paine

      by shrike on Sun May 29, 2011 at 09:34:15 AM PDT

      [ Parent ]

      •  It may have provided liquidity... maybe... (1+ / 0-)
        Recommended by:
        nippersdad

        but it did not provide for a return to levels of lending prior to the collapse, as was the stated intention.

        In fact, multiple reports show that lending did not at al increase.

        TARP was a fail.

        But it sure succeeded in allowing bigger banks to get bigger by buying competitors.... which sure made for record bonuses for CEOs.

        It worked in that regard.

        By way of helping the average consumer access lending?

        FAIL!

        Maybe it had something to do with a blank check and practically no requirements.

        Job well done for the Bushies, Dems.

        More and Better Democrats

        by SJerseyIndy on Sun May 29, 2011 at 09:48:15 AM PDT

        [ Parent ]

        •  Not True (1+ / 0-)
          Recommended by:
          Actuary4Change

          In the short-term, it did not result in immediate loans being made.  The rest of the global banking system did a partial freeze as well, so it was a more complicated process back to the road of liquid lending, but within the 12-14 month term, it did allow the banks to get healthier, and begin repackaging loans to businesses, which needed the liquidity first and foremost. It is just now beginning to trickle down to the residential consumer.  Should that have been faster?  Perhaps. If it happened in a vacuum, you'd have that self-satisfying "gotcha" moment. Otherwise, when everywhere from England to Australia was hitting that speed-bump, it would not have been possible for our banks to unilaterally put their lending into high gear without tripping over all of the crud that had to be accounted for globally prior to moving forward.

          Stop totalitarianism in the United States before it's too late. Speak truth to power! - Join me at truth-2-power.com

          by Brian Ross on Sun May 29, 2011 at 10:26:32 AM PDT

          [ Parent ]

    •  What TARP Accomplished (3+ / 0-)
      Recommended by:
      ybruti, Actuary4Change, Gary Norton

      1. Gave the system enough liquidity to avoid complete melt-down and take the globe into a decade-long recesssion;
      2. Kept millions more people from being unemployed by forcing a hard reset on both management and the unions at the Big Three and coming up with a solution that would allow millions more to be able to keep their autos (GMAC and Chrysler both were big auto lenders as well. Hitting Chapter 11 would have caused several million people to lose their financing for autos as well as the millions more losing jobs not just from the Big Three but all of the collateral industries that support them.

      If you want a more detailed "discussion of the matter" see my blog posting on it at:

      http://truth-2-power.com/...

      Stop totalitarianism in the United States before it's too late. Speak truth to power! - Join me at truth-2-power.com

      by Brian Ross on Sun May 29, 2011 at 10:22:57 AM PDT

      [ Parent ]

  •  People have forgotten where we were (3+ / 0-)
    Recommended by:
    ybruti, Actuary4Change, Gary Norton
    On Thursday, Sept. 18, 2008, the astonished leadership of the U.S. Congress was told in a private session by the chairman of the Federal Reserve that the American economy was in grave danger of a complete meltdown within a matter of days. "There was literally a pause in that room where the oxygen left," says Sen. Christopher Dodd (D-Conn.).

    As the housing bubble burst and trillions of dollars' worth of toxic mortgages began to go bad in 2007, fear spread through the massive firms that form the heart of Wall Street. By the spring of 2008, burdened by billions of dollars of bad mortgages, the investment bank Bear Stearns was the subject of rumors that it would soon fail.

    "Rumors are such that they can just plain put you out of business," Bear Stearns' former CEO Alan "Ace" Greenberg tells FRONTLINE.

    The company's stock had dropped from $171 to $57 a share, and it was hours from declaring bankruptcy....

    Within months, however, Paulson would witness the virtual collapse of the giant mortgage companies Fannie Mae and Freddie Mac and preside over their takeover by the federal government.

    The episode sent shockwaves through the economy as confidence in Wall Street began to evaporate. Within days, in September 2008, another investment bank, Lehman Brothers, was on the brink of collapse. Once again, there were calls for Bernanke and Paulson to bail out the Wall Street giant. But Paulson was under intense political pressure from conservative Republicans in Washington to invoke moral hazard and let the company fail.

    "You had a conservative secretary of the Treasury and conservative administration. There was right-wing criticism over Bear Stearns," says Congressman Barney Frank (D-Mass.), chairman of the House Financial Services Committee.

    Paulson pushed Lehman's CEO Dick Fuld to find a buyer for his ailing company. But no company would buy Lehman unless the government offered a deal similar to the one Bear Stearns had received. Paulson refused, and Lehman Brothers declared bankruptcy.

    http://www.pbs.org/...

    Retirement Savings Lose $2 Trillion in 15 Months

    http://www.washingtonpost.com/...

    Rising suicide rate worldwide linked to economic crisis, experts say

    Local mental health professionals say many of the people calling them have reached their breaking point.  Its keeping hotlines jammed and the voices on the other end are increasingly desperate.

    With nowhere else to turn many people are calling suicide-prevention hotlines.  “It’s very scary,” explained Margie Wright, the Executive Director of Suicide & Crisis Center of North Texas.  “People pick up the newspaper, watch the television and all they hear is bad news and people are afraid and when they are afraid they go into crisis.” According to Wright, the center’s calls have increased by up to 15-percent.
    Mental health experts say the sour economy has turned what usually manifests as seasonal blues into a full-blown crisis.

    http://economiccrisis.us/...

    Humans don't tend to give you credit for a catastrophe you've prevented. But I am glad that were are not where we were and the role that TARP played in getting us here.

    •  Fuld did not get it (0+ / 0-)

      He underestimated the scope of the crisis. He turned away capital white knights twice. Lehman deserved to die off. Merrill Lynch grabbed their deal and that was that.

      Stop totalitarianism in the United States before it's too late. Speak truth to power! - Join me at truth-2-power.com

      by Brian Ross on Sun May 29, 2011 at 10:28:41 AM PDT

      [ Parent ]

  •  I was reading just the other day (2+ / 0-)
    Recommended by:
    Alice in Florida, pickandshovel

    about a FED program which led to hundreds of billions lent out to both Wall Street and European banks at 0.0078% interest just after the Lehman collapse; pre-TARP. Point being, we already knew that Wall Street was repaying TARP using off the books government loans. TARP was not the only giveaway.

    The surprise would be if they had failed to pay those loans off. With as much money as has been thrown at them, one could conceivably make the argument that such a track record with regard to repayment of TARP funds could fall within the realm of accountancy error, or PR.

    I'm just not as impressed as you appear to be.

    •  Hundreds of billions that weren't TARP Money? (0+ / 0-)

      Too much money. Cite the source. Sounds fishy.

      B.

      Stop totalitarianism in the United States before it's too late. Speak truth to power! - Join me at truth-2-power.com

      by Brian Ross on Sun May 29, 2011 at 10:29:55 AM PDT

      [ Parent ]

      •  I first read of it in a column (1+ / 0-)
        Recommended by:
        pickandshovel

        on HuffPo entitled "Fed loses cred". I thought that was clever.

        The current incarnation of the story is by William Alden, entitled "Federal Reserve lending revelations intensify criticism of central bank's secrecy".

        3.3 trillion dollars pre-TARP might have been something you would have noticed, not to mention all of the Maiden Lane transactions......

      •  ST OMO, QE1, QE2... (0+ / 0-)

        I think what sounds fishy is a lack of prosecution on anything at that level. What prevents the show from happening again?

        "We can't solve problems by using the same kind of thinking we used when we created them." - Albert Einstein

        by pickandshovel on Sun May 29, 2011 at 02:17:32 PM PDT

        [ Parent ]

      •  Ah, the Bush gift set... (0+ / 0-)

        Yes.  That was fun. Not TARP. Not Obama's watch.  Consider it W.'s parting gifts.  Nixon wanted the silverware. Bush cleared out the treasury.  All Republican presidents leave their stain, er, mark.

        Stop totalitarianism in the United States before it's too late. Speak truth to power! - Join me at truth-2-power.com

        by Brian Ross on Sun May 29, 2011 at 08:52:26 PM PDT

        [ Parent ]

  •  amendments (0+ / 0-)
    (TARP), with the Obama amendments, has worked

    What are the "Obama amendments" to TARP to which you are referring?

    •  Amendments (0+ / 0-)

      Compensation restrictions, deals to acquire preferred shares which yield 8-9% interest on the government's money, deals to hold some level of sway on the really damaged companies boards, as in GM, and sway to tie things like developing a high-mileage car to repayment terms (Chrysler).  It's all there and more if you read the main article.

      Thanks!

      Stop totalitarianism in the United States before it's too late. Speak truth to power! - Join me at truth-2-power.com

      by Brian Ross on Sun May 29, 2011 at 12:00:00 PM PDT

      [ Parent ]

  •  If you're thinking 2012 Presidential Cycle (0+ / 0-)

    Then it would be nice if Unemployment, the foreclosure rate, and real estate prices would get back to pre-crisis levels ahead of schedule. Sure, on the numbers the program may have worked -- for the banks. But the story doesn't end there.

    "We are stardust, we are golden, we are caught in the devil's bargain, and we got to get ourselves back to the garden." - Joni Mitchell

    by shaggies2009 on Sun May 29, 2011 at 12:20:16 PM PDT

    •  Like the bitters... (0+ / 0-)

      Jobs: Talk to our Republican friends who had billions in their coffers in corporate America and held it back because driving the demon black guy who holds them accountable out of office was priority one.  

      Foreclosure rate:  There is a part of the problem that was banks making loans to people with cherry noses and big shoes for $300,000 when they couldn't afford a can of tuna. On the other hand, there were also a lot of greedy a**holes who figured they could outrun their balloon payments, or flip houses to millions.  For them, I have dick for sympathy.

      What I do know, though, is that there are people who took sensible mortgages, paid their bills and lived their lives off of a bread line because we didn't send a tidal wave of pain their way by drying up credit for 4 years and collapsing some of our biggest employers. Just the ripple of GM's bankruptcy sent dozens of otherwise profitable companies into the toilet and cost thousands of jobs.  Millions of jobs?  I don't think that you, shag, or anyone else would be able to stand there in front of the American people and account for yourself for that.

      But your liberal piety is duly noted.

      Stop totalitarianism in the United States before it's too late. Speak truth to power! - Join me at truth-2-power.com

      by Brian Ross on Sun May 29, 2011 at 08:50:52 PM PDT

      [ Parent ]

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