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« Brad Sherman Annihilates Mark Haines And Erin Burnett | Main | SIGTARP Report Says Geithner Is Lying To Taxpayers About AIG, 'Hiding $40 Billion In Losses' »
Wednesday
Oct052011

Tim Geithner's Magical Mystery Tour Of TARP Propaganda Has Little Use For Truth

How many times does Geithner lie in his latest op-ed.  Tim is thinking 5.

---

By Dr. Pitchfork

In "5 Myths About TARP," Tim Geithner joins Steve Rattner and Herb Allison in the parade of Washington insiders who have gone out of their way to tout the great success of TARP, calling it the "most effective government program in recent memory."  If you think the Timmy doth protest too much, methinks you're exactly right.

Geithner starts by rehearsing the same, tiresome narrative we've heard a thousand times:

  • [TARP] was essential to averting a second Great Depression, stabilizing a collapsing financial system, protecting the savings of Americans and restoring the flow of credit that is the oxygen of the economy. And it helped achieve all that at a lower cost than anyone expected.

Then Geithner proceeds to debunk some "myths" about TARP.

Myth 1.  TARP cost taxpayers hundreds of billions of dollars.

Well, TARP did cost hundreds of billions of dollars.  This isn't a myth.  $700B were authorized by the legislation.  Nearly $400B were appropriated and disbursed.  And according to the latest figures from the U.S. Treasury (that would be the little outfit where the author, Tim Geithner, hangs his hat every day) roughly half of that amount, about $200B, remains outstanding.  And the costs of TARP are a "myth"?  Apparently Geithner thinks we should give him a cookie just because some of the money might be paid back -- in the future.  Don't be fooled by headline numbers saying TARP may cost "only 30B," because those numbers are based on wildly optimistic projections of what Treasury's ownership of AIG, GM and C will be worth.

And how did the banks pay back TARP?  First, we got rid of mark-to-market accounting, changing their balance sheets overnight, and then the banks have been borrowing from the Fed at ZERO and earning the spread on Treasuries or anything else they wanted to put the money in.  The effect of this process is a transfer of wealth from savers (who depend on bank CD's) and pension funds (who are often required to invest in goverment bonds) to the same banks that took money through TARP.  This cost amounts to hundreds of billions of dollars each of the last two years.  And TARP had negligible costs?

Besides, like we've said before, all the talk about getting the TARP paid back is a red herring. If someone breaks into your house, tears the place up, and then sticks a gun to your head demanding $700B, you don't thank him when he pays you back.  Because a) you had a gun stuck in your face, and b) your house is still a freakin' mess.

Myth 2.  TARP was a gift to Wall St. that did nothing for Main St.

This is Geithner's attempt to construct a straw man (TARP "did nothing") and then blow him down.  Was TARP a gift to Wall St.?  Yes.  What did TARP do for Main St.?  Not much.  Geithner's claim here is that TARP helped stop a financial panic that would have hurt the rest of the economy.  First of all, contrary to popular belief, TARP wasn't actually very helpful in the crisis and may have accellerated it.  The actions that truly helped in the crisis period are discussed here.  But we were never faced with a choice between TARP and doing nothing while the world burned.  This false choice between TARP or nothing is repeated almost every single time a TARP apologist opens his or her mouth.  Don't let them get away with it.  Repeat:  there was NEVER a choice between doing TARP and doing nothing.

But Main St. did get something out of the deal.  Delinquent borrowers were able to apply for HAMP.  HAMP allowed banks to give borrowers false hope for a few months while they continued to pay their mortgages out of their life savings.  Banks and servicers also collected some nice fees for letting borrowers sign up for the program -- on a temporary basis.  Real nice.  See here and here.  Main St. thanks you, Mr. Secretary!

Myth 3.  TARP left our financial system weak.

Timmy doesn't even try on this one.  Makes some claim about how government ownership of Fannie, Freddie and AIG, together with Bank of America's purchase of Merrill, makes the system stronger.  What?  Oh, and then there were the non-stress tests.  Big whoop.  Question: If the financial system is so strong and stable, then why is the Obama administration still so afraid of ruffling its feathers?  And why are they terrified of honest accounting?   Well?.... (Cue crickets.)

Myth 4.  TARP left the banking system more concentrated and more vulnerable to a crisis.

Geithner admits that this one isn't a myth at all.  So that's 4 Myths, but who's counting?  Still, it's OK that our banks are bigger than they were before the crisis, Geithner says, because Europe's banks are even more concentrated (and everyone knows they're not at risk of a crisis).  But it's also OK to have Too Bigger To Fail banks because now we have this wonderful thing called the Dodd-Frank Act.  And it has "a clear prohibition on taxpayer-funded bailouts."  Meh.  Sorry if I'm underwhelmed by a "clear prohibition." Because as one wag points out, "We wipe our asses with the Constitution these days, in case you haven't noticed."  Moreover, most of those credit default swaps that made them so afraid in 2008 are still out there.  There is ZERO chance that the resolution authority is actually put into use.

Myth 5.  TARP was part of Obama's strategy to take more control over the economy.

Anyone who thinks that Obama has "control" over Wall St. is out of his tree.  In any case, Geithner helpfully points out here, that not only did Democrats like Obama fall to their knees in 2008 and fellate the TBTF banks, but so did Bush and a bunch of Republicans.  Glad you see it our way, Timmy.

--

The bottom line on TARP is that almost no one has been held accountable.  And almost everyone, even those most responsible, have kept their jobs, been promoted, been awarded huge bonuses, or have ridden off into the sunset with millions in ill-gotten gains.  That includes Tim Geithner.  He was president of the NY Fed from 2003-2008 and oversaw the crisis from start to finish.  Because of the failures of people like Geithner, our entire monetary and fiscal order has been re-arranged to serve the interests of a few at the very top of the pyramid.  Because of the actions (and inactions) of people like Geithner, the middle class has borne most of the risk associated with TARP and all the other bailout programs.  And much of that risk is still with us, whether in terms of our currency, the national debt, or social and political unrest.

The message of the bailouts, like Geithner's message to us, is clear.  The guys at the top get served first, at our expense.  We are expected to be grateful that people like Geithner have bailed them out.  And the buck stops nowhere.

##

 

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  • Response
    Response: Covered By A TARP
    im Geithner and Larry Summers have engaged in a massive redistribution of wealth, from the bottom to the top.

Reader Comments (36)

Great work pitch...very well-put together...i'm going to send it to joe and ratigan...
Oct 14, 2010 at 12:36 PM | Registered CommenterDailyBail
Right on Doc. Pitchfork.

When is that lying little worm going to crawl back in his hole at Goldman Sucks?
I can't stand to even look at him let alone pay any attention to what he says.
Oct 14, 2010 at 2:36 PM | Unregistered CommenterSagebrush
pitch...i sent it to dylan and...you have officially been retweeted by ratigan...and he usually only does 4 or 5 per day...and look at his page...we have 2 retweets from him today...

http://twitter.com/dylanratigan
Oct 14, 2010 at 2:46 PM | Registered CommenterDailyBail
Is Geithner really still a story? Geithner is working for the Group of Thirty (Fed/Central Bank Owners).

I still rank the power as follows...

Group of Thirty (Vocker as the face of it)
Bernanke and Geithner report to and take orders from the Group of Thirty.
Obama gets a mornig memo telling him in marcro terms what will happen next. I am sure by now that he barely reads them, he can just wait for the talking points memos from his team.
Axelrod and his team continue to craft and implement socialism as well as attempt to expand liberalism by destroying our culture.
Obama advisors create the talking points for Obama.
And the wheel goes round and round and round...
Oct 14, 2010 at 2:49 PM | Unregistered CommenterZ
pitch...you should hurry up and take a screenshot...for your grandkids when you explain one day how YOU helped stop the washington bailout machine...a man armed just with a keyboard...;)
Oct 14, 2010 at 2:50 PM | Registered CommenterDailyBail
pitch...i sent it to dylan and...you have officially been retweeted by ratigan...and he usually only does 4 or 5 per day...and look at his page...we have 2 retweets from him today...
---
Awesome! Thanks, DR.
Oct 14, 2010 at 2:52 PM | Registered CommenterDr. Pitchfork
pitch...you should hurry up and take a screenshot...for your grandkids when you explain one day how YOU helped stop the washington bailout machine...a man armed just with a keyboard...;)
---
Isn't it pretty to think so, Brett Ashley ;-)
http://www.sparknotes.com/lit/sun/quotes.html#explanation5
Oct 14, 2010 at 2:54 PM | Registered CommenterDr. Pitchfork
DB, can you increase the print size in the post box? It is too small. Thanks. Then you can go back to dot dot dash dashing your partner.
Oct 14, 2010 at 3:07 PM | Unregistered CommenterZ
I just don't want to get caught in the virtual crossfire.
Oct 14, 2010 at 3:10 PM | Unregistered CommenterZ
what do you mean by post box..?..the story itself..
Oct 14, 2010 at 3:23 PM | Registered CommenterDailyBail
The box that I am writing this response/comment in.
Oct 14, 2010 at 4:06 PM | Unregistered CommenterZ
Just Another Example of Another One of Truth’s Protective Layers…

With the media’s voracious insatiable appetite for making Bush look bad and Cheney look like a controlling monster, I never heard this story until now.

Keep in mind that this is just a little story that most people, including me, would care about aside from its slight shock value.

Here is the story…the Cheney hunting accident…
It makes me wonder what they hide when they feel a stronger need to hide.
What is impossible to hide and what is easy to hide?
We all know that Obama has hid an awful lot of who he is, where he came from and whether he is qualified to be where he is now. Many people don’t even know his many names.
http://www.aolnews.com/nation/article/did-dick-cheney-ever-apologize-for-plugging-hunting-buddy-harry-whittington/19673953?icid=main%7Cmain%7Cdl1%7Csec1_lnk3%7C177647

His injuries were more dire than originally reported. Whittington suffered a collapsed lung and underwent invasive exploratory surgery, as doctors probed his vital organs for signs of damage.

Two hundred bits of shrapnel pierced Whittington's face, neck and chest. His face is scarred and about 30 pieces of shot are still deeply embedded in his body.
Oct 14, 2010 at 4:59 PM | Unregistered CommenterZ
Z, try Ctrl and + That will increase the font size.
Oct 14, 2010 at 5:00 PM | Registered CommenterDr. Pitchfork
Dr. P....

What if Obama actually wanted to audit the Fed and made it a priority.

The fact that Obama isn't in charge and knows he is just holding down a chair and a golf cart is very telling. I wonder how history would have been written if this was Bush's second term. Would he get a pass like Obama or would he be considered a power player who is doing this for his rich daddy issues. Your partner wanted me to read your propaganda and now I have to hit the delete delete delete button on you nonsense. Obama might not control Wall Street but he has an obligation to look after the best interests of us Americans and he is a fraud and is guilty of treason.

DB…Please give me credit for reading his op-ed. I just don’t have to swallow it hook line and sinker like a brain-dead stooge, right? I hope.
Oct 14, 2010 at 5:07 PM | Unregistered CommenterZ
Thanks, that control + seems to have worked. It is still a difficult font to read but much better.
Oct 14, 2010 at 5:08 PM | Unregistered CommenterZ
Dr. P--

Thanks for continually exposing TARP as the utter nonsense it's been from Day One. The banksters know how pissed off Americans are about it, so they make sniveling jackasses like the elf pen op-ed pieces, which are then obediently parroted by morons on TV. The chain of command is clear. And let's be clear about one thing: Obama, Geithner, and the talking heads function as no more than highly-paid secretaries taking dictation.

In that light, the connection here to Ratigan, who actually thinks for himself, seems like outright mutiny and makes me laugh every time he picks up one of your pieces. It also speaks to the high quality of DB's site.
Oct 14, 2010 at 5:42 PM | Unregistered CommenterCheyenne
Thanks, Cheyenne. You know, I wonder every day how Ratigan still has a job, or got the one he has. If you're not a NWO conspiracy theorist, it shows that the powers that be are not monolithic, and that there is some hope for enlightenment and change. On the other hand, many will argue that Ratigan's employment just proves that he's compromised somehow and is REALLY just part of the larger conspiracy. Whatever. Occam's razor. Ratigan is just about the best thing on television.
Oct 14, 2010 at 6:03 PM | Registered CommenterDr. Pitchfork
Is Tim the one who decided to let Fannie control/watch/ 250 million dollars for 600 employees to "Oversee" this money?
Isn't that a little like letting the Fox guard the hen house?
Oct 14, 2010 at 6:23 PM | Unregistered CommenterBackgammon
Gobie,

That was a pretty big story in 2006, don't know how you missed it. Harry has been very politically active his entire life.

http://www.washingtonpost.com/wp-dyn/content/article/2010/10/13/AR2010101307173.html

At least the White House did the honorable thing, blame the victim.

http://delong.typepad.com/sdj/2006/02/blaming_the_vic.html

Thank God it was not deer season.
Oct 14, 2010 at 6:32 PM | Unregistered CommenterS. Gompers
Gomp...

Do you always miss the point? Ummmm, because you missed it again.

.
Oct 14, 2010 at 7:29 PM | Unregistered CommenterZ
Dr. P--

I'm not a theorist at all, NWO or otherwise. The facts are too interesting for that. And fact is, as you've so amply laid out, TARP is a load of a shit, a ridiculous lie.

Why is Ratigan on TV at all? It must be due to high ratings. Do Ratigan's rants rattle some of his shows advertisers? I'm pretty sure they do, but I don't know. I stopped watching TV years ago, but only because sites like this one and others are more interesting than TV, trucking, as they do, in factual information. It is TV that promotes the theories, bankrupt theories, so utterly absurd that it's just a waste of time.

Ratigan's pissed off advertisers, assuming there are any, have figured out one thing: 90% of people's problems stem from the fact that THEY JUST DON'T LISTEN. They get the "gist" of what they hear, which is fucking useless. But actual listening? Dream on.
Oct 14, 2010 at 7:37 PM | Unregistered CommenterCheyenne
Oh, I didn't mean you personally, Cheyenne. Good points.
Oct 14, 2010 at 7:47 PM | Registered CommenterDr. Pitchfork
No Gobie, I did not miss the point. The point is, where was your Senator and Congress critter when he threw his hat in the ring for POTUS. Where was McCain or the Sublime court on the issue?

A couple more weeks and you can reward your extra specials for their exemplary service to the Country and Constitution. You know you have to...

And Dick is still a nutless wonder for not apologizing to Harry.

As to your "slight shock value" statement, some people actually go to jail for accidentally shooting people and showing no remorse. I can see criminal recklessness while armed with a deadly weapon causing serious bodily injury.

http://www.timesleader.com/pittstondispatch/news/Man_gets_6-12_years_for_accidental_shooting_06-30-2010.html

Plus Cheney was poaching.

http://www.timesonline.co.uk/tol/news/world/us_and_americas/article730682.ece

Such wanton disrespect for the law and a person you injured out of your own stupidity, you are right, it is of slight shock value. Perhaps Goobermint officials should have the right to shoot citizens for sport while you re elect those who blindly gave the possible free pass to the POTUS.

I really f@cking hate poachers, I had a cow shot once by a poacher, seems he could not tell the difference between a hereford and a deer.

http://www.hereford.org/

http://www.ohiohistorycentral.org/entry.php?rec=1886&nm=Ohios-State-Mammal-White-tailed-Deer
Oct 14, 2010 at 8:12 PM | Unregistered CommenterS. Gompers
What are you talking about? Your rants are funny.
Oct 14, 2010 at 8:27 PM | Unregistered CommenterZ
But again, way off point.
Oct 14, 2010 at 8:33 PM | Unregistered CommenterZ
"where was your Senator and Congress critter when he threw his hat in the ring for POTUS. Where was McCain or the Sublime court on the issue?"

That would be the real question that needs to be answered about your obsession.

The rest would be about your "of little shock value" shooting incident and the illegal hunting (that is what poaching means for you city boys) that contributed to it. I think Harry found it to be quite shocking when he got shot in the face by a unapologetic moron, I know I would.

I should have known you would probably think poaching was something you do with eggs... Hence your confusion.
Oct 14, 2010 at 8:45 PM | Unregistered CommenterS. Gompers
Dr. P--

Personally, I knew you never did. However--and here everyone should pay attention--what we do here or on CR or NC or on ZH or on whatever--it's all a matter of public record now. And each and every poster here knows that. Or should, especially by now.

What to take away? Never leave the record unclear. Talk about a black swan...
Oct 14, 2010 at 10:20 PM | Unregistered CommenterCheyenne
thanks cheyenne for the kind words about the site...i'm certainly trying...as for ratigan, all i've heard is that the top brass really likes him...his ratings have been decent...they should be better...

z...what font do you recommend...i've often wondered if the font size is right for the main story text and also if i'm even using the correct font...if anyone has any thoughts on this, feel free to offer them....
Oct 15, 2010 at 2:06 AM | Registered CommenterDailyBail
I think it's good. Try reading Naked Capitalism or Market Ticker. They both give me a headache. I mean, I love 'em, but...
Oct 15, 2010 at 2:10 AM | Registered CommenterDr. Pitchfork
yes...neither one tries very hard with their overall formatting...i think it keeps me away from their sites sometimes...
Oct 15, 2010 at 2:18 AM | Registered CommenterDailyBail
well look at that...yves smith published your story as a guest post this morning...nice...

http://www.nakedcapitalism.com/2010/10/guest-post-tim-geithners-magical-mystery-tour-of-tarp-propaganda-has-little-use-for-truth.html

I sent it to her overnight...thanks yves...
Oct 15, 2010 at 4:58 AM | Registered CommenterDailyBail
Check it out. Some guy from Texas sent our article to his congressman, to the two senators from TX, and to Barack Obama. Hope Barry enjoys the Mystery Tour.
http://www.congress.org/congressorg/bio/userletter/?letter_id=5928865571&content_dir=congressorg
Oct 15, 2010 at 10:49 PM | Registered CommenterDr. Pitchfork
Did he send my corrections as well?
Oct 15, 2010 at 11:27 PM | Unregistered CommenterZ
Condé Nast's CFO Tried To Pay $2,500 for a Night
With a Gay Porn Star
Jordan Sargent


Filed to: SEX 7/16/15 8:26pm


https://cryptome.org/2015/07/gawker-geithner.pdf



David Geithner, brother of ex-Obama Treasury Secretary Tim Geithner, is currently the chief financial officer of
Condé Nast. This past weekend, he’d planned to go to Chicago—where he planned to meet a gay porn star and
escort for “2-3 hours” at a cost of $2,500.
But this would not be a simple sexual transaction. Geithner, it seems, fucked with the wrong escort. The escort—
who does not want to reveal his identity for professional reasons, but whom we will call Ryan—says he bailed on
the date with the married (to a woman) father of three because Geithner declined to use his influence to help with
a housing dispute.
The thwarted rendezvous began on July 4, when Geithner first contacted Ryan, whose phone number is available
on a number of Chicago-area escort websites, via text message. Geithner said that he was going to be in Chicago
exactly a week later, and would pay $2,500—plus airfare and hotel—for “2-3 hours” of Ryan’s services.
Jul 28, 2015 at 8:12 AM | Unregistered Commenterjohn
Arkin at Gawker resigns over Geithner story.

https://cryptome.org/2015/07/gawker-fires-arkin.htm



Dear Friends,

Two Fridays ago, when I read a story posted on Gawker that seemed to senselessly out a nobody for soliciting a gay porn prostitute, I immediately thought someone should be fired.

I never thought it would be me.

To me, the story wasn’t out of character for Gawker, nor did I think it “vile” or any of the hyperbolic adjectives heaped upon it: It seemed perfectly in line with the aesthetic of this world of digital anarchy. And I thought that amidst a high stakes legal battle of Hulk Hogan versus Gawker in which the company was arguing that it was justified to post a sex tape because Hogan was a public figure, someone had made a grave error in demonstrating that that really didn’t matter, that if Gawker had to the goods – and the article was meticulous in documenting its nothingness with texts and screenshots of Fedex receipts – it would publish them.

The owner of Gawker took down the post, I guess the first time that was done in 13 years, and though at first I thought it a defensive move to symbolize the company’s journalistic creds, in reality behind the scenes it seemed the end of a long internal fight. The top editor in chief and the editor at Gawker resigned in protest, claiming that Nick Denton had done exactly what he had promised previously not to do in setting up an editorial staff to insulate him and “the business side.” The two editors who resigned were as impetuous as the owner in citing this and that reasons for why they had to go. The external shitstorm, the resignations, and then the internal drama left the staff in the lurch and without leadership and without even a clear mission. And just let me say: Though almost every article I have read since has captured Gawker’s rapid meltdown, I haven’t really seen one that captures fully what happened and why.

But here’s the truth: The goods on Geithner were so good, the story almost wrote itself. That’s exactly the same that I’ve experienced working for network television or the mainstream media and is commentary on our frenzied society. But it is not unique; not even to new media. And it all happened on a Friday afternoon, including the throat clearing and cowardly call I got telling me to take the buyout. So the next time the CIA or Pentagon puts out an unpleasant press release on a Friday, take pity: That’s how all institutions, old and “new” act. Now the Gawker management is trying to portray the corrective as some new Gawker – “20 percent nicer” or is it kinder or is it smarter, I forget – and hopefully the readers won’t notice or care and the advertisers and sponsors will return.
Jul 28, 2015 at 8:52 AM | Unregistered Commenterjohn

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