TRILLIONS IN DEBT: WILL REAL COST OF ‘TARP’ SOAR INTO QUADRILLIONS?
Christopher J. Petherick
The Troubled Asset Relief Program (TARP) ended in September. Since then, Washington has been trying to prove that bailing out Wall Street with taxpayers’ money prevented the total collapse of the economy.
While taxpayers are expected to get back much of their money, TARP is only one small part of the trillions of dollars worth of backdoor bailouts, asset guarantees, low-interest-rate loans, free money and other benefits handed out to the Money Trust. But thanks to secrecy on the part of the banksters, Americans may never know just how much money the economic depression of 2007 actually cost them.
TARP was passed in October 2008. At the time, the massive $700 billion handout to Wall Street was the largest taxpayer-funded bailout of all time.
Today, Washington’s economists contend that taxpayers should get most of that money back, except for about $50 billion to $60 billion. But, in reality, this is only the tip of iceberg. According to Bloomberg News reporters Mark Pittman and Bob Ivry, when all the special deals are tallied, the true costs come in at around $12.8 trillion—$1 trillion short of the U.S. gross domestic product.
This includes $29 billion worth of tax breaks for banks; $168 billion given by the Bush administration as part of a smaller stimulus program; $787 billion handed out by President Obama under his stimulus package; $400 billion for Fannie Mae and Freddie Mac to prop up the mortgage industry; $500 billion released by the FDIC to cover bank failures; plus $300 billion from the Federal Housing Authority to help the troubled housing sector. But this is not all that was offered to financial firms.
There are trillions more dollars that the privately owned and controlled Federal Reserve has handed out to keep the system afloat. Over the past two years, the Fed has created numerous financial programs, which functioned solely to guarantee risky loans and complicated debt and interest-rate swaps and to back assets that continued to lose their value.
Fed bankers also lowered the discount rate to near zero, handing out free money for bankers to use at their own discretion. They were even making hundreds of billions of dollars worth of loans to foreign central banks.
Of course, the Federal Reserve did not want the soiled masses to know any of this. The Fed arrogantly continues to stonewall the release all of thedetails to the public—so there may be billions or even trillions of dollars more that we don’t know about.
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(Issue # 42, October 18, 2010)
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