US: Watchdog says Treasury misled public about cost of bank bailout

[Hannah Bell]

Neil Barofsky, a top overseer of the US bank bailout program, published an audit Monday in which he asserted that Bush administration Treasury officials misled the public about the financial condition of firms receiving bailout funds. The revelations amount to an admission by an agency of the federal government that top government officials lied to the public about potential losses in order to push through the bailout program.

Barofsky, the special inspector general for the Troubled Asset Relief Program (TARP), noted that in selling the bailout to the American people, Bush administration officials repeatedly insisted that the banking system was sound and claimed that the public stood to retrieve the $700 billion in taxpayer money allocated under TARP, perhaps with a profit...

“Secretary of Treasury Hank Paulson came out to repeatedly emphasize how healthy these institutions were, and as a result, that this infusion of capital would get them lending again, and as we disclose in our audit, this just wasn’t an accurate statement.” He added, “The Treasury and the Federal Reserve had serious concerns about the health of these institutions.”

Asked about the likelihood that the US government would recoup the money it spent bailing out the banks, Barofsky said, “I think it’s extremely unlikely that we’re going to have a dollar-for-dollar return, and I don't think the program is designed to have a dollar-for-dollar return...”

This is not the first time an oversight body has issued criticisms of the bailout program. On July 20, Barofsky chided the Obama administration Treasury Department for failing to demand that the banks disclose what they were doing with the taxpayer money they had received, and warned that the bailout could end up costing the government up to $23 trillion. Earlier that month, the Congressional Oversight Panel, another oversight body for the TARP, found that the government was receiving just 60 cents on the dollar on many obligations owed to it by the banks.

http://www.wsws.org/articles/2009/oct2009/tarp-o06.shtml

[joeycola]

1. ...........These revelations have been simply ignored.

...........These revelations have been simply ignored. The TARP oversight bodies have no real power, and neither the Obama administration nor the Democratic-controlled Congress has any intention of responding to their disclosures or acting on their recommendations for greater “transparency.”

[ellenfl]

2. they did the same with the medicare prescription drug bill.

they have low-balled everything from the wars to the prescription drug bill. why would they start telling the truth on the way out? they can't stuff their pockets with the truth. :eyes:

ellen fl

[nc4bo]

3. "misled" or lied? These two words often get used interchangeably.

I find myself replacing "misled" with LIED. I can't even tell the difference between the two anymore.

Gee, I wonder why.

[Echo In Light]

4. The euphemistic, Orwellian terminology runs rampant!

... sort of how Bush/Cheney were "incompetent," and not mass murdering war criminals. Double plus un-good, indeed.

[fooj]

6. There really isn't much of a difference...

only in the way it's "perceived"...

http://www.thefreedictionary.com/mislead

IMO, bullshit is bullshit. It's that simple.

:grr:

[Romulox]

11. How about "defrauded"? It covers both situations.

[midnight]

5. HB thanks for posting this. I wonder why they even bothered to audit.

The red flag should of been that their was to be no strings attached to the bail out money.

[Romulox]

7. But we're making a PROFIT!!!! So say our resident "economists"!

:rofl:

[blindpig]

8. k&r, n/t

[gkhouston]

9. Glad I was sitting down when I got that nasty shock.

:eyes:

[Orwellian_Ghost]

10. K&R