The American taxpayer was swindled to the tune of $786 billion for the TARP bailout of banks that were “too big to fail.” But at least we knew about it.
Thanks to language inserted into the Dodd-Frank bill by Ron Paul, a partial and very begrudging audit of the Federal Reserve has revealed that some of Mittens Romneycare’s biggest donors got over $7.7 TRILLION in secret, smoke-filled-room, under-the-table bailouts from the Federal Reserve.
It took three years of Freedom of Information Act requests by Bloomberg to get details of the secret bailouts and the massive swindle of the American people they represented.
The entire Bloomberg exposé is here. It’s very long and detailed…and the more you read, the angrier you will get.
For a Cliff’s Notes version, check out this commentary from The American Spectator. Here’s an excerpt (emphasis added):
On Sunday evening, Bloomberg News published a story that confirmed the worst suspicions of bailout critics. The article revealed that trillions of dollars of emergency loans the Federal Reserve disbursed during financial crisis went to the biggest banks, ultimately providing firms then on the edge of collapse with a $13 billion profit. According to Bloomberg, the Federal Reserve’s total emergency commitments to big banks like Goldman Sachs and Morgan Stanley number $7.7 trillion when the previously unknown loans are taken into account.
Bloomberg’s expose makes it clear, three years afterward, that the infamous Troubled Asset Relief Program (TARP), which divided the country and ignited at least one mass protest movement (if not two), was never more than a sideshow when compared to the bailouts authorized by the Fed. TARP only allocated $700 billion for bailouts, and a significant portion of those funds were never used.
The Bloomberg story, reported by Bob Ivry, Bradley Keoun, and Phil Kuntz, needs no editorializing, because the facts alone are damning. The article notes that banks like Citigroup and Bank of America would have had less success lobbying against regulations limiting their rent-seeking activities had the public and Congress known that only trillions of dollars in Fed loans kept them afloat. There is little doubt that, as the authors conclude, “taxpayers paid a price beyond dollars as the secret funding helped preserve a broken status quo and enabled the biggest banks to grow even bigger.”
The Fed’s various emergency lending programs, TARP, and the other bailouts undertaken by the government, together, saved the banking system but shortchanged the broader public. That was apparent well before Bloomberg uncovered this latest information, which only reveals the full scope of the swindle.
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