One Year After the Bail-Outs, Two Investigative Reporters Attempt to Find Out Where All the Money Went

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xraymike79's picture
xraymike79
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Joined: Aug 24 2008
Posts: 2040
One Year After the Bail-Outs, Two Investigative Reporters Attempt to Find Out Where All the Money Went

 

This story came to me as highly recommended. I haven't read it yet, but I'm posting a snippet of the article and link for my future reference and for others.

Good Billions After Bad

As the Bush administration waned, the Treasury shoveled more than a quarter of a trillion dollars in tarp funds into the financial system—without restrictions, accountability, or even common sense. The authors reveal how much of it ended up in the wrong hands, doing the opposite of what was needed.

October 2009

 

James Steele and Donald Barlett, contributing editors at Vanity Fair. Barlett and Steele have won virtually every major national journalism award, including two Pulitzer Prizes and two National Magazine Awards.
 
It’s been exactly one year since the onset of the financial crisis and the passage of the Bush administration’s $700 billion bailout of Wall Street. But what were the factors in deciding who received bailout funds? And what happened to all the money? The answer to those two simple questions is: We don’t know. In a new article in Vanity Fair, the Pulitzer Prize-winning investigative team Donald Barlett and James Steele try to find an answer. The problem is, they write, “once the money left the building, the government lost all track of it.”
 "...
Last October, Congress passed the Emergency Economic Stabilization Act of 2008, putting $700 billion into the hands of the Treasury Department to bail out the nation’s banks at a moment of vanishing credit and peak financial panic. Over the next three months, Treasury poured nearly $239 billion into 296 of the nation’s 8,000 banks. The money went to big banks. It went to small banks. It went to banks that desperately wanted the money. It went to banks that didn’t want the money at all but had been ordered by Treasury to take it anyway. It went to banks that were quite happy to accept the windfall, and used the money simply to buy other banks. Some banks received as much as $45 billion, others as little as $1.5 million. Sixty-seven percent went to eight institutions; 33 percent went to the rest. And that was just the money that went to banks. Tens of billions more went to other companies, all before Barack Obama took office. It was the largest single financial intervention by Treasury into the banking system in U.S. history.
But once the money left the building, the government lost all track of it. The Treasury Department knew where it had sent the money, but nothing about what was done with it. Did the money aid the recovery? Was it spent for the purposes Congress intended? Did it save banks from collapse? Paulson’s Treasury Department had no idea, and didn’t seem to care. It never required the banks to explain what they did with this unprecedented infusion of capital.
Exactly one year has elapsed since the onset of the financial crisis and the passage of the bailout bill. Some measure of scrutiny and control has since been imposed by the Obama administration, but even today it’s hard to walk back the cat and trace the money. Up to a point, though, it’s possible to reconstruct some of what happened in the first chaotic and crucial three months of the bailout, when Treasury was still in the hands of Henry Paulson and most of the money was disbursed. Needless to say, there is no central clearinghouse for information about the tarp money. To get details of any kind means starting with the hundreds of individual recipients, then poring over S.E.C. filings, annual reports, and other documentation—in other words, performing the standard due diligence that the government itself failed to perform. In the report that follows, we have no more than dipped a toe into the morass, but one fact emerges clearly: a lot of the money wound up in the coffers of some very surprising institutions— institutions that should have been seen as “troubling” as much as “troubled.”....

October 2009: Donald L. Barlett and James B. Steele on the U.S. ...

 

DrKrbyLuv's picture
DrKrbyLuv
Status: Diamond Member (Offline)
Joined: Aug 10 2008
Posts: 1995
Re: One Year After the Bail-Outs, Two Investigative ...

I don't think we should be surprised that there is no transparency in the bail-out - it's not our right to chart the course of the U.S. financial future.  We gave away this right in 1913 with the non-Federal Reserve Act.  They control our economy and money through a special monopoly. 

They won't tell us where the money went because it was stolen.

Larry

xraymike79's picture
xraymike79
Status: Diamond Member (Offline)
Joined: Aug 24 2008
Posts: 2040
Re: One Year After the Bail-Outs, Two Investigative ...

I don't think we should be surprised that there is no transparency in the bail-out - it's not our right to chart the course of the U.S. financial future.  We gave away this right in 1913 with the non-Federal Reserve Act.  They control our economy and money through a special monopoly. 

They won't tell us where the money went because it was stolen.

Larry

 

As Stan Lee always says...'Nuff said!

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