Redistributing Wealth

[Octafish]

32. How about my mortgage? That'd help a lot.

US taxpayer paid Bailout, though, went to the people who stole it to begin with -- the Banksters.

Neil Barofsky on the “Broken Promises” of the Bank Bailouts

August 1, 2012, 10:46 am ET by Jason M. Breslow PBS

By any objective standards, the Trouble Asset Relief Program [TARP] has worked,” the Treasury Department wrote in a July progress report (PDF) on the $700 billion program that Congress authorized in 2008. “It helped stop widespread financial panic, it helped prevent what could have been a devastating collapse of our financial system, and it did so at a cost that is far less than what most people expected at the time the law was passed.”

Neil Barofsky sees it much differently. From December 2008 to March 2011, Barofsky, a formal federal prosecutor and lifelong Democrat, served as special inspector general of TARP, charged with protecting against abuse and fraud in the program. In his new book about that experience, Bailout, he writes that the American people “should be enraged by the broken promises to Main Street and the unending protection of Wall Street.”

FRONTLINE spoke with Barofsky, now a senior fellow at New York University School of Law, about his time policing TARP. This is an edited transcript of that conversation:

You are highly critical of the management of TARP. What went wrong?

It’s important to remember that there were a number of different objectives for TARP. It did meet one of its primary objectives, which was to help prevent the entire collapse of our financial system. … The other goals, which have more of a focus on helping Main Street institutions and individuals and businesses definitely small enough to fail — those goals all came short.

So, for example, TARP was supposed to be used by the banks to restore lending, help pump that oxygen into the lifeblood of the economy, and it just didn’t happen. One of the reasons why it didn’t happen is the money went to the banks with no strings attached, no conditions, no incentives, just essentially piles of money given to them without any instructions whatsoever and sort of this hope that somehow or other they use the money to achieve the policy goals of the administration. Of course, that never happened and you just look at the malaise the economy has been in in the years ever since.

Similarly, TARP was supposed to help homeowners, and that was part of the very bargain that was struck in order to get TARP passed. … We had a housing program that was an utter failure by any definition if you look at what its original goal was — up to 4 million homeowners helped, and today it’s around 800,000, 20 percent of that goal. Or if you look at how much money has been spent, just a small tiny fraction, maybe 6 percent of the original $50 billion, on par with what credit card companies got.

So you’re sort of left here, almost four years after the bailout, with this tremendous amount of effort and money going to save the banks but all the other goals, really important Main Street goals to help everyone else, just abandoned.

What do you say, though, to those who argue that while the bailouts may not be popular, they did stabilize the banks, as well as the auto sector, for far less money than first feared?

It’s undoubtedly good news that the losses are less than we originally intended. … But again, even the saving, or stabilizing the financial system — to what end? What we’ve done is essentially preserve a fundamentally broken status quo that led to the financial crisis in 2008, and we took a lot of problems in the system and in some ways made them worse.

CONTINUED...

http://www.pbs.org/wgbh/pages/frontline/business-economy-financial-crisis/money-power-wall-street/neil-barofsky-on-the-broken-promises-of-the-bank-bailouts/

This makes certain people with means furious to see discussed.

Neil Barofsky Gave Us The Best Explanation For Washington's Dysfunction We've Ever Heard

Linette Lopez
Business Insider, Aug. 1, 2012, 2:57 PM

Neil Barofsky was the Inspector General for TARP, and just wrote a book about his time in D.C. called Bailout: An Insider Account of How Washington Abandoned Main Street While Rescuing Wall Street.

SNIP...

Bottom line: Barofsky said the incentive structure in our nation's capitol is all wrong. There's a revolving door between bureaucrats in Washington and Wall Street banks, and politicians just want to keep their jobs.

For regulators it's something like this:

"You can play ball and good things can happen to you get a big pot of gold at the end of the Wall Street rainbow or you can do your job be aggressive and face personal ruin...We really need to rethink how we govern and how regulate," Barofsky said.

CONTINUED... http://www.businessinsider.com/neil-barofsky-2012-8

Thank you for caring about where the monies and Justice went, Vinca.