On October. third, the controversial TARP (Troubled Asset Relief Program ) , after being more successful and costing less than expected . In a poisonous political climate, TARP became a symbol of government waste and an opportunity for Republicans to co-opt the word “bailout” as a weapon to inflict damage on the opposition . As banks bailed out by Troubled Asset Relief Program continue to generate obscene profits, a majority of Americans continue to struggle, which has backed Democrats into a corner for supporting a strategy first implemented while George W. Bush was still president.
That which we pay for TARP
TARP will stop extending loans Sunday, however it will continue to collect dividends and repayments. Fortune at CNN reports that it is been two years since Congress gave $700 billion to the Treasury Department to prevent an economic collapse. Troubled Asset Relief Program’s bill is less than everyone thought it would be when Wall Street is working on getting back into shape and the economy is working at healing. The Treasury states that only $386 billion of the fund was really given from the government. That cash is coming back to the government at a much higher rate than expected. This week Treasury secretary Tim Geithner said he expected the total cost of TARP to come in under $50 billion.
The toxic backlash of TARP
The financial system needed saving from the government that came only partly via the Troubled Asset Relief Program , reports the Washington Post. The mortgage and housing market was something that the Treasury and Federal Reserve thought needed saving. They spent over $1.5 trillion trying to help this. The bailouts have also helped the government get a little more control. It is part of the private sectors with this. As a result, political extremists are painting economic rescue as a socialist takeover. Political figures that had a yes vote for TARP will end up having significant consequences within the November elections due to the resentment many feel towards the government right now.
Behind Troubled Asset Relief Program are issues
TARP, despite meeting its intended results at a discount, has put Democrats on the spot for defending a program that was the product of the Bush administration. ABC News explains that Republicans are excited that Troubled Asset Relief Program is not something the country likes. That means that those associated with the term bailout, President Obama and Democrats, aren’t liked because of the bad connotation. For example, at an press conference Aug. 10, House Republicans used the word at least seven times while badmouthing a $26 billion state fiscal aid package moving through Congress. Republicans made a “Pledge to America” where this was mentioned. The program, although already expired, is something they plan to stop forever.
Citations
CNN
finance.fortune.cnn.com/2010/10/01/tarp-ends-thrifty-but-unloved/
PMS Money Blog
personalmoneystore.com/moneyblog/2010/07/15/banks-and-bailouts/
Washington Post
washingtonpost.com/wp-dyn/content/article/2010/09/30/AR2010093006621.html
ABC News
abcnews.go.com/Politics/tarp-government-bailout-ends-sunday-started-bush-gop/story?id=11765955
