Tag Archives: TARP

Republicans want Obama to cancel Fannie Mae and Freddie Mac bonuses

From Fox News.

Excerpt:

A Republican senator is calling on President Obama to cancel the $12.8 million in bonuses that were approved for 10 executives at the government-seized mortgage giants Fannie Mae and Freddie Mac that received a $170 billion taxpayer-funded bailout.

“I am calling on the president of the United States to cancel those bonuses and explain to the American people, the taxpayers who bailed out Freddie and Fannie, why he continues to reward failure,” Sen. John Barrasso, R-Wyo., said at a news conference Tuesday.

The two housing giants have received about $141 billion in taxpayer funds since the government took them over in 2008 during the financial crisis.

Politico first reported the $6.46 million in bonuses for the top five officers at Freddie Mac — including $2.3 million for CEO Charles E. Haldeman Jr., who is stepping down next year — and $6.33 million for Fannie Mae officials, including $2.37 million for CEO Michael Williams, for meeting modest goals.

A second bonus installment for Freddie executives in 2010 has yet to be reported to the Securities and Exchange Commission, Politico reported.

So where will these million dollar bonuses come from?

Fannie and Freddie Bailout Chart
Fannie and Freddie Bailout Chart

They come from taxpayers. Obama’s millionaires and billionaires get the bailouts, you get the bill.

In case you are looking for a good summary of the subprime mortgage crisis, read this recent article from Investors Business Daily.

Darrell Issa and the Republican plan to clean up corruption

I am happy that Boehner and McConnell are going to push the ban on earmarks, but who is going to fix the corruption, fraud, and lack of transparency elsewhere in government?

Consider this article from Investors Business Daily.

Excerpt:

You may never have heard of Rep. Darrell Issa, but you will soon. Republicans have tasked him with cleaning up four years of Democratic misrule and misconduct. It’s a big job, but somebody simply must do it.

For proof, look no further than Tuesday’s dirty debacle with Rep. Charles Rangel, who walked out of a congressional hearing before being found guilty by the House ethics committee on 11 of 13 charges of misconduct.

[…]As the head of the House Oversight and Government Reform Committee, California Republican Issa has promised aggressive investigations of misconduct, wherever it occurs. We think it’s long overdue.

[…]The list of troubling government activities that should be investigated is a long one. Issa’s already looking into Fannie Mae and Freddie Mac. And he’s been openly critical of the Obama stimulus’ lack of controls and poor accounting practices.

He — or other GOP committees — may also look into AIG and the other bank bailouts, and answer who got money and why.

Then there’s the Countrywide VIP program, in which some Congress members got favorable mortgages. And don’t forget the $700 billion TARP program, the government’s takeovers of GM and Chrysler, the links between the left-wing community organizing group ACORN and the Democrats, and even U.S. Minerals Management Service misconduct prior to the BP oil blowout.

I would really like to see an investigation of where the bailout money and stimulus money went.

Have the Democrats finally stopped spending money on bailouts?

The AP reports that bailout spending is ongoing, despite Treasury Department claims that bailouts are over. (H/T ECM)

Excerpt:

The Treasury Department says its bank bailouts are over, but the spending continues.

In a Sept. 22 speech, Treasury Secretary Timothy Geithner said the bailouts “are completely behind us.”

That’s not quite correct. In the final six months in which it could spend money from the Troubled Asset Relief Program, Treasury set aside $243 million for new contracts for law firms, accountants and money managers to help run what’s left of the bailouts – on top of the $529 million already spent on work by staff, private companies and other agencies. Many of the contracts last until 2019, and there’s nothing to stop the government from hiring even more help if it’s needed to chase down the remaining bailout money.

Treasury’s authority to spend more from the $700 billion fund expired on Oct. 3. The law requires officials to recoup as much as possible of the $185 billion still in the hands of shaky private companies. After all collections are made, the government expects to be out about $51 billion, mostly from housing programs.

Rising voter anger ahead of next week’s elections has made Obama administration officials reluctant to speak candidly about the ongoing cost of managing TARP. Politicians who voted for the TARP law now face tough re-election fights. By downplaying their efforts, officials sidestep criticism of bailouts that helped Wall Street without easing lending or keeping many people in their homes.

A government watchdog said this week that public statements by Treasury officials around the Oct. 3 deadline appeared designed to create a mistaken sense that TARP is over.

“The idea that TARP is dead is just not accurate,” said Neil Barofsky, the special inspector general overseeing the program, in an interview. “People can write its obituary, people can declare that it’s been put out of its misery, but there’s still close to $180 billion of TARP money outstanding, and $82 billion obligated to be spent.”

ECM also sent me this article from the Heritage Foundation which explains how to cut $343 billion from the federal budget without breaking a sweat.

 

Obama to appoint anti-business radical to regulate businesses?

From ABC News. (H/T Verum Serum)

Excerpt:

President Obama will announce this week that Elizabeth Warren, the Harvard Law School professor who first proposed the Consumer Financial Protection Bureau, will be named to a special position reporting to both him and to the Treasury Department and tasked with heading the effort to get the new federal agency standing, a knowledgeable Democrat told ABC News.

Warren currently chairs the Congressional Oversight Panel of the Troubled Assets Relief Program and has been seen by many on the Left as a force for greater accountability and transparency, and a check against the forces in the Obama administration more closely allied with the financial sector. Many officials in that sector eye her warily as too anti-business…

Naming Warren as an assistant or counselor to both the president and Treasury Secretary Tim Geithner would allow the president to bypass a Senate confirmation process that could prove lengthy and contentious.

Morgen writes:

The official White House announcement tomorrow will no doubt emphasize Warren’s role in originating the idea for this agency, and her impressive academic credentials. (Credential number one – she’s a “dear friend” of Obama’s dating back to law school.)

But expect there to be major fireworks over this appointment. Just how anti-business is Warren? Here is only a preview, from her blog on TPM in 2005 (emphasis added):

The middle class is being carved up as the main dish in a corporate feast.  Strugging with flat incomes and rising costs for housing, health care, transportation, child care and taxes (yes, taxes), these folks are under a lot of financial strain.  And big corporate interests, led by the consumer finance industry, are devouring families and spitting out the bones.

Well, I think it’s safe to say she isn’t a fan of this particular industry, if not corporations in general. But with the Consumer Financial Protection Agency charged with regulating everything from mortgages to credit cards, and the companies who market them, you would think it would be helpful to have someone with at least a semblance of impartiality heading it up.

Apparently the White House disagrees.

This is why corporations aren’t hiring. They’re waiting for anti-business Obama to get voted out in 2012.

New York Times admits that GM repaid its bailout loans with TARP loan money

Story here in the radically-leftist New York Times. (H/T Hot Air)

Excerpt:

AS we inch closer to a clearer understanding of the products and practices that unleashed the credit crisis of 2008, it’s becoming apparent that those seeking the whole truth are still outnumbered by those aiming to obscure it. This is the case not only on Wall Street but also in Washington.

Truth seekers the nation over, therefore, are indebted to Senator Charles E. Grassley, Republican of Iowa, who in recent days uncovered what he called a government-enabled “TARP money shuffle.” It relates to General Motors, which on April 21 paid the balance of its $6.7 billion loan under the Troubled Asset Relief Program.

G.M. trumpeted its escape from the program as evidence that it had turned the corner in its operations. “G.M. is able to repay the taxpayers in full, with interest, ahead of schedule, because more customers are buying vehicles like the Chevrolet Malibu and Buick LaCrosse,” boasted Edward E. Whitacre Jr., its chief executive.

G.M. also crowed about its loan repayment in a national television ad and the United States Treasury also marked the moment with a press release: “We are encouraged that G.M. has repaid its debt well ahead of schedule and confident that the company is on a strong path to viability,” said Timothy F. Geithner, the Treasury secretary.

Taxpayers are naturally eager for news about bailout repayments. But what neither G.M. nor the Treasury disclosed was that the company simply used other funds held by the Treasury to pay off its original loan.

This is what you get when you appoint a tax-cheat to be the Treasury Secretary.

Here’s what we need to understand about government bailouts. There should never be any such thing as a government bailout. GM and these other bailed-out companies made bad decisions that put them at a competitive disadvantage with respect to their competitors. The Obama administration bailed out these failing companies with money from other hard-working individuals and successful companies, including small businesses. The Obama administration did this for political gain with its favored special interest groups, e.g. – unionized labor,  wall street bankers and GSE executives. Those are the groups that got Obama elected, and he paid them back with “bailouts”. Government has no right to get involved with bailing out their buddies with my money and your money.

I remember when people use to complain about profit margins of 8% in some big corporations when Bush was President. But at least they earned that money by selling things that people needed and freely chose to buy. They did operate on a government-backed expense account. Sometimes I wonder whether all of these problems are caused because we elect spoiled-brat, silver-spoon liberals who spent their entire lives getting into trouble and then begging their parents, (and grandparents, in Obama’s case), for bailout money. Maybe they are just making policy based on their experiences in making irresponsible choices and then being bailed out by their parents?