It's been a while since I looked into the fiasco that was TARP. Instead of continuing to demonstrate my possibly faulty memory and possible lack of understanding, let me ask you two some questions so you can enlighten me.
First, Tell me if my understanding of this is correct.
When the bill passed and became Public Law 110-343, some funds ($250 billion IIRC) were made available to the treasury secretary. This money was authorized to be spent and put into a "TARP fund" for the secretary to use.
Eventually, the TAPR fund grew, first to $350 billion, then ultimately to $700 billion.
Paulson used some of this money to buy preferred shares in the banks. Other amounts were used to bail out the auto makers, and for other purposes.
My question is this, after the banks bought back their preferred stock, "returning the money plus interest," did their repayments go to the general treasury? Or did those payments go back into the "TARP fund" where the treasury secretary could use them to buy additional "troubled assets?"
My understanding is that once authorized, those funds are available to any future treasury secretary to spend on anything he/she determines is a "troubled asset." So, when the banks "paid back" their loans/bought back their preferred stock, that money is now in an account that is already authorized to be spent.
So if Geithner and Obama want to call Solydnra or Evergreen Solar a "troubled asset," can they use this money to buy those bankrupt "green energy" companies.
Was the authorization ever revoked? Did the TARP fund have an expiration date? Have these funds been returned to the treasury? Or do Geithner and Obama now have a $700 billion slush fund to spend however they want?
Until that money is de-authorized, de-allocated and returned to the treasury general fund, we have no idea whether the taxpayers "made a profit" or not. We don't know how much was spent or wasted, because it's still available to be spent again.
I think it remained in the "TARP fund".
My understanding is that once authorized, those funds are available to any future treasury secretary to spend on anything he/she determines is a "troubled asset."
I think that was the original idea.
Was the authorization ever revoked? Did the TARP fund have an expiration date?
According to this TARP ended.
Until that money is de-authorized, de-allocated and returned to the treasury general fund, we have no idea whether the taxpayers "made a profit" or not.
I disagree. TARP made a profit.
If the government wastes the profit (and the original funds) that doesn't change the fact that a profit was made.
As far as I understand it, 700B was originally allocated to the fund. 250B was to be released immediately, with another 100B available if the President certified that the amount was necessary.
The second installment of 350B could be released with another certification from the President; this is the batch of money Bush left available for his successor. Obama released the second batch in Mar. '09 I think.
Last I heard the Gov’t had gotten all but 25B back.