President Obama declared on the CBS “60 Minutes” television show, “I did not run for office to be helping out a bunch of fat cat bankers on Wall Street.” Really, Mr. President? Then why did you accept $38 million in campaign contributions from those “fat cats” in the industry?1
“Ken Schoolland economic report chart 1 centered”
All the major Democratic and Republican presidential contenders supported the Toxic Asset Relief Program (TARP) as passed by Congress in September of 2008. Soon after passage, the package was miraculously transformed from $700 billion in mortgage relief for homeowners to a banker bailout program. This was only the tip of the iceberg. The spending surged to $1.5 trillion under President Obama with estimates of bailout guarantees ranging up to $8 trillion, twice the inflation adjusted cost of World War II.
”The Iron Triangle: Special Interests, Politicians, & the Bureaucratic Payoff”
The 2008 campaign season was also marked by the largest ever flood of money into politics, nearly half a billion dollars from the finance, insurance, and real estate industry alone. Money from this industry was the most from any sector of the economy and was distributed in roughly equal proportions to Democrats and Republicans.
“Ken Schoolland economic report chart 2 centered”
The 161 companies receiving $305 billion in the original TARP bailout funds made campaign contributions and lobbying expenses totaling $114,000,000 to all candidates. That works out to more than $2600 of bailout funds for each $1 of political expenses in the 2007-2008 electoral season.
“Ken Schoolland economic report chart 3 centered”
Most of these contributors are banks and investment houses. They know that there is no better investment anywhere in the world than a well-placed politician.
”Bankruptcy vs. Bailout”
So what’s the problem with a bailout? Wasn’t it necessary to rescue the financial system from collapse? Despite the hype, this was not the message from the World Economic Forum, a Swiss think tank.
The World Economic Forum ranked the United States as number one in the world for financial strength, the same month that Congress passed the TARP. In September 2008 the U.S. was listed as top of the world for the “strength of their financial markets, and the depth and breadth of access to capital and financial services. This wide-ranging index takes into account the quality of each country’s financial laws and regulations, its business environment, and the likelihood of a financial crisis