Tea-Bigots have ferociously attacked Obama for lending the banks $700 billion in TARP funds, even though the bailout was promised by Bush before Obama was even elected, and most of the loans have since been repaid.

 

But where were the Tea-Bigots in 2008, when Bush gave Wall Street nearly $8 trillion dollars in 0% interest loans, with no strings attached? We sure could have used a little “Don’t Tread on Me!” then, but not a peep from the patriots! Maybe giving free money to predatory capitalists is OK when a white boy does it.

 

Bush’s first no-strings giveaway to Wall Street pushed $2 trillion. The money went directly from the Federal Reserve to the banks, with Fed Chairman Ben Bernanke promising transparency which he has ever since adamantly refused to provide:

 

 ”The Federal Reserve Refuses to ID Recipients of $2 Trillion”

“Nov. 10, 2008 (Bloomberg) — The Federal Reserve is refusing to identify the recipients of almost $2 trillion of emergency loans from American taxpayers or the troubled assets the central bank is accepting as collateral.

 

“Fed Chairman Ben S. Bernanke and Treasury Secretary Henry Paulson said in September they would comply with congressional demands for transparency in a $700 billion bailout [TARP] of the banking system. Two months later, as the Fed lends far more than that in separate rescue programs that didn’t require approval by Congress, Americans have no idea where their money is going or what securities the banks are pledging in return.”

 

Bush’s second no-strings giveaway to Wall Street, arranged months before Obama took office, brought the total to over $7.7 trillion.

 

“U.S. Pledges Top $7.7 Trillion to Ease Frozen Credit

“Nov. 24, 2008 (Bloomberg) — The U.S. government is prepared to provide more than $7.76 trillion on behalf of American taxpayers after guaranteeing $306 billion of Citigroup Inc. debt yesterday. The pledges, amounting to half the value of everything produced in the nation last year, are intended to rescue the financial system after the credit markets seized up 15 months ago.

“The commitment dwarfs the plan approved by lawmakers, the Treasury Department’s $700 billion Troubled Asset Relief Program. Federal Reserve lending last week was 1,900 times the weekly average for the three years before the crisis.”

 

Bush  set up these deals at the end of his second term. The plan was that the GOP would blame the coming economic crash, which these loans  were intended to avert, on the Democrats, setting the stage for a 2010 GOP comeback.  This strategy was implemented by Fox News, and featured ”grass roots” activists (referred to here as Tea-Bigots) who were organized before Obama’s election by Dick Armey’s FreedomWorks.

 

But the rabidly anti-tax Tea-Bigots are curiously unconcerned about this massive giveaway, another indication that their supporting interests are the same as those of the banks.

 

A Simple Illustration 

Here’s how these lucrative Fed-to-bank loans play out in real life: Imagine I give you a trillion dollar loan. I make you promise that you’ll share this money with your poorer neighbors, but I charge you nothing for the loan, nor will I tell anyone else I gave it to you.

 

You do nothing with the money except put it in your bank account, where it earns 1/2 a percent interest compunded. How much profit do you  earn the first quarter? Five billion dollars. In a year? 20 billion, plus an extra hundred or so million, due to compounding. Not bad for doing nothing. Free money.

 

Next, imagine that I allow you to invest this money anyway you want. You put it in energy and weapons stocks (with a few million dollar donations to war-mongering political candidates), and receive a modest 5% return. What’s that profit look like?  Fifty billion dollars in one quarter, or two hundred billion dollars the first year–plus a few extra billion due to compounding. At this rate, in less than two years you could recoup the entire loss of the subprime mortgage market!

 

Good for you, and bad for everyone else. Though you promised you would, you refuse to share any of your free money, so none of those dollars ever make it back into the economy. The poorer neighbors you were supposed to help go belly up, and you then use your loan profits to buy their assets. Since I never told anyone I lent you the money, I can’t accuse you of breaking the terms of the deal, nor force you to give the money back, and nobody else is able to prosecute you for fraud.

 

If and when Congress ever gets me to fess up about my loan to you, you’ll have already shifted those earnings offshore and gone bankrupt to protect them–and maybe received taxpayer bailouts to start all over again. In the meantime, I’ll be replaced by someone who doesn’t know anything about our arrangement.

 

The Bushes gave away America’s money in other ways, too.  Early in the Iraq war, for example, Bush sent nearly $10 billion of  ”reconstruction money” to Iraq, which his commanding generals were to funnel to contractors. Billions of taxpayer dollars were stacked in neat piles on wooden palettes, wrapped in plastic and shipped in cargo containers aboard C130’s. All of that money disappeared without a trace, too! Again, not a whisper of protest from T’s.

 

Just how, in these circumstances, are the taxpayers are ever to be repaid?  IMO, the plan all along was that they wouln’t be. At any rate, we can’t expect help from the “anti-tax” crowd; looks like it really is racism, not taxation, that drives the Tea-Bigots after all.