Assuming that the Bush-Paulson Wall Street bailout gets changed drastically by the time it’s passed, we can all tip our hat to Mother Jones. With everyone on the Hill screaming about the power grab Treasury Secretary Henry Paulson is trying to engineer, the magazine’s Nomi Prins deserves a deep thanks for noticing the really, really, teeny tiny, fine print in what Treasury sent to the House and Senate.
Prins alone seems to have discovered that the barely-discussed Section 6 of the newly-named Troubled Asset Relief Program, or TARP, creates a never-ending bailout with the key phrase, “The Secretary’s authority to purchase mortgage-related assets under this Act shall be limited to $700,000,000,000 outstanding at any one time.” (Italics added)
What “at any one time” means when it’s not raining is simply this: If whatever the taxpayers buy turns out to be worth zero, nada, nothing, zip, then Ol’ Hank, Wall Street’s best friend in Washington, can buy up another $700-billion worth of junk to give the banks a second helping at the public trough. And so on ad nauseum until the public is left holding an expensive, empty sack while banks, insurance companies and other bailed out lenders profit from the crème de la crème they keep in their portfolio.
I’d love such a sweet deal! Who wouldn’t? No wonder the financial services lobby – never shy before in publicly pleading for Congressional relief from this or that – has kept their mouth shut on the bailout.
The TARP they’re trying to cover us with is misnamed; it should be the HAPASWEAT, short for the Hank Paulson Sweater because he wants to give us a warm and cozy feeling as he pulls the wool over our eyes.
Charley James is an American journalist, author and essayist who lives in Toronto.
Reprinted with permission from The ProgressiveCurmudgeon.
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