Night of the Living TARP (Congress Goes Ghoul.)

Center for Fiscal Accountability ^ | 10/4/10 | CFA

[Andrea19]

While proponents of the $700 billion bank bailout may have celebrated the “end” of TARP this weekend, there are several reasons taxpayers are not off the hook yet for this unprecedented intrusion into the financial industry. The program that was intended to rescue financial entities deemed “too big to fail” has itself become a costly behemoth, the repercussions of which will be felt for years.

While government capital was injected directly into banks at the caprice of the Treasury Department under TARP, they have no obligation to pay these funds back as long as they make dividends payments on the loans. Currently, about 600 banks have refused to give back their taxpayer-funded handouts. Congress keeps resurrecting TARP: Congress recently passed a bill that established the Small Business Lending Fund, a program predicated on the same failures of the first bank bailout. It allows Treasury $30 billion in new capital to inject into small banks, despite the fact that small lenders who received funding under the original bailout have failed to pay dividends on those loans...

[Andrea19]

Congress' cannibalistic cravings have gone too far.

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