
week, Republicans and Democrats in Washington, D.C. are patting
themselves on the back for a job well done. Not only are they claiming
to have saved the nation from a “Second Great Depression,” this
so-called economic miracle was apparently purchased at a bargain
basement price.
taxpayers “only” $66 billion. The White House puts the figure even lower
— at $50 billion.
liquidating its ownership stake in hundreds of “private” corporations —
including a 92 percent stake in the American International Group (AIG)
and a 61 percent stake in General Motors (GM).
will have to sell 1.66 billion shares of common stock at an average
price of $29 per share. At GM, the government must sell 304 million
shares of common stock at an average price of nearly $134 per share.
Hitting these targets would be a daunting task in any economic climate —
and may prove insurmountable in our ongoing malaise.
$25 billion?” an investment research publication recently asked. “The
follow on question is: why would investors buy AIG shares while the
government’s AIG stock sale could last 18-24 months?”
in recent weeks — a sign that the company will be forced to continue
operating under the “Government Motors” banner for the foreseeable
future.
final TARP tab and assessing its risk versus reward — it’s about
honestly assessing the problems that come with government picking
winners and losers in the marketplace in the first place. Even if
government’s taxpayer-funded investments yielded better than average
returns (or huge cash windfalls), that doesn’t make them right — nor
does it mean taxpayers will ever see one red cent of their money back.
all over the world to make out like bandits (as bureaucrats across the
country did in the wake of the “stimulus”), what about the people who
were forced to pick up the tab? What about the 15 million Americans who
are currently unemployed? Or the millions of American households that
have seen their income levels decline in each of the last two years?
What about the small business owners whose taxes are about to skyrocket
as government begins making interest payments on its massive new debt?
Washington told the rest of America that it was “too small to succeed.”
“doom and gloom” pronouncements that preceded TARP — which would
obviously negate much of its supposed efficacy in avoiding a global
economic meltdown.
Bernanke appeared before the Joint Economic Committee of the U.S.
Congress and made an impassioned plea for taxpayer-funded intervention,
saying that emergency action was required immediately in order to
“address the grave threats to financial stability that we currently
face.”
was on the verge of shutting down. This sent major shock waves through
Congress, as many companies use the sale of this short-term debt to pay
their bills and make payroll. A week after Congress passed TARP,
however, Bernanke announced the creation of a special commercial paper
funding facility — thus arbitrarily alleviating one of the key pressures
he had used as leverage to help get the bailout passed.
the sky would fall in October 2008 absent government intervention is the
fact that government intervened — and the sky fell anyway. Economists
in their taxpayer-funded ivory towers will no doubt continue to do
battle over hypothetical contingencies, but that doesn’t change the fact
that 8 million jobs vanished in just over a year’s time — and those
jobs aren’t coming back anytime soon.
government thus far is actually being returned to taxpayers. Nor is it
being used to pay down America’s ballooning debt. Instead, it’s being
spent on new bailouts, more borrowing and additional deficit spending.
remember that its initial $700 billion outlay represents only a small
sliver of the money government has spent, lent, pledged and printed
since the recession began in December 2007.
little grandmother
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By Howard Rich
As the infamous Troubled Asset Relief Program (TARP) winds down this
According to the Congressional Budget Office, TARP will cost
Of course these rosy, election-year estimates are based on government
For taxpayers to recoup their “investment” in AIG, the government
“How does one get $49 billion out of a company that’s currently worth
Short answer? They wouldn’t — and likely won’t.
Meanwhile GM has dramatically scaled back its initial public offering
But this debate isn’t about getting an accurate accounting of the
And while TARP has enabled union bosses in Detroit and AIG executives
Certainly interest rates are low for the time being, but the threat of rising rates is a ticking time bomb.
In designating the wealthiest Wall Street banks as “too big to fail”
Also, there is also considerable debate as to the accuracy of the
For example, a week before TARP passed Federal Reserve Chairman Ben
At this hearing, Bernanke testified that the commercial paper market
Perhaps the most effective argument against those who claimed that
Meanwhile, none of the TARP money that’s been repaid to the U.S.
Also, in confronting the “toxic” realities of TARP it’s important to
That’s a tab taxpayers will still be picking up decades from now.
The author is chairman of Americans for Limited Government.
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Rachel Corrie / Courtesy Rachel Corrie Foundation |
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Before 9/11 guess what 2 countries DID NOT have a Rothschild owned and started Central Bank; Afghanistan and Iraq. |
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I hope there is justice for Rachel but I fear there will not be. |



