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TARP Shortchanged Taxpayers by $78 Billion, Watchdog Panel Says
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| Contributor | Craverguy |
| Last Edited | Craverguy Feb 06, 2009 12:30am |
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| Category | News |
| News Date | Friday, February 6, 2009 06:00:00 AM UTC0:0 |
| Description | U.S. taxpayers are being shortchanged by about $78 billion through the Treasury Department’s bank bailout, the panel overseeing the program said.
The Treasury, when it was headed by Secretary Henry Paulson, received bank assets worth about $176 billion in exchange for capital purchases of $254 billion under the Troubled Asset Relief Program, the Congressional Oversight Panel said in a report today.
“The loss estimate is conservative,” said Representative Alan Grayson, a Florida Democrat on the House Financial Services Committee. “It could turn out that those assets in the end are worthless. These are massive handouts to favored institutions to try to make up with taxpayer money the mistakes they made with investor money.”
The public’s stake in the nation’s banking system continues to grow as first the Bush administration and now President Barack Obama’s team work to pull the U.S. out of the deepest recession in at least two generations. TARP, which is part of the more than $9 trillion the government has pledged to rescue the financial system, has guaranteed $350 billion to banks so far, with another $350 billion set for use in coming months.
Treasury spokesman Isaac Baker declined to discuss the panel’s report directly. He said Treasury officials have already “prevented a systemwide collapse” and plan to make an announcement next week.
“We will outline a comprehensive strategy to strengthen our financial system in order to provide American businesses and families the credit they depend on, while strengthening transparency and accountability measures so that taxpayers know where and how their money is being spent and whether it’s achieving real results,” Baker said today in an e-mail. |
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