Everyone (well, everyone not in Washington) knew TARP I would turn out to be a pork-fest. And Congress just gave $350 billion more in pork for TARP II. But for those who thought Bush was the problem, and hope-n-change will be completely accountable and transparent, consider what the Wall Street Journal just discovered about the criteria for TARP funds — lobbying Congress and the Democratic majority.
Troubled OneUnited Bank in Boston didn’t look much like a candidate for aid from the Treasury Department’s bank bailout fund last fall.
The Treasury had said it would give money only to healthy banks, to jump-start lending. But OneUnited had seen most of its capital evaporate. Moreover, it was under attack from its regulators for allegations of poor lending practices and executive-pay abuses, including owning a Porsche for its executives’ use.
Nonetheless, in December OneUnited got a $12 million injection from the Treasury’s Troubled Asset Relief Program, or TARP. One apparent factor: the intercession of Rep. Barney Frank, the powerful head of the House Financial Services Committee.
Mr. Frank, by his own account, wrote into the TARP bill a provision specifically aimed at helping this particular home-state bank. And later, he acknowledges, he spoke to regulators urging that OneUnited be considered for a cash injection.
Barney Frank … you know, the same one who was supposed to regulate Fannie and Freddie, took their lobbying money, told you how safe and sound they were …. right up until they collapsed.
THAT Barney Frank.
So how will hope-n-change monitor those of his own party? He won’t (and can’t even if he tried). TARP II (and the soon-to-come stimulus, also known as the Generational Theft Act of 2009) is and will be pork-fests for Congress as they seek to return favors and institute social policy. If you’re connected, you can get bailout/TARP/Stimulus money so you can keep driving your Porsche — courtesy of Barney Frank and majority members of Congress — while everyone else (well, the 50% left of the country paying income taxes) pays for it.
Thanks guys — this is yet another demonstration of why gridlock in Congress is good — the less these guys do the better it’s for everyone.
The country has a hangover from the drunken spending spree of Congress. And like any hangover, it won’t go away with any magic cures — you’ve just got to suffer through it and come out the other side (and hopefully learn your previous binges don’t produce good results). The country got into this mess by Congress deficit spending and expansion of easy credit (sub-prime mortgages given to people who everyone knew couldn’t pay via NINJA loans [no income, no job] and the Community Reinvestment Act).
And how do the Washington elites plan to get the country out of this mess? Deficit spending and credit expansion.