While both parties crow about their achievements and their grand plans, I thought it might be a good time to check the scoreboard on how the massive financial system bailout was working.
According to the detailed tracking by Propublica, the US government has lost $197,600,000,000 so far, more than three years into the recovery.
While there are some profit points, AIG still owes the government over $23 billion for its existence. Bank of America Countrywide is $663 million in the hole. Blackrock investment fund still owes over $1.2 billion. Chrysler owes over $1.3 billion. Fannie Mae is down $90 billion (and getting worse). General Motors owes $27 billion and GMAC (renamed Ally) owes $10.7 billion. Popular Bank owes $773 million. Wellington investment fund $2.9 billion.
These are staggering losses for the taxpayer. The argument from the Fed is that it would have been much worse without intervention, and for a short time, no doubt it would have been. Some viable businesses were saved, but so were money losing, inefficient businesses. The bailout cemented the broken state of the economy in place.
The main incentive in business now is to become so big and financially interconnected that the Fed will print trillions and hand it to you to keep your failed business alive no matter what. Then, you can sit back and collect the bailouts into retirement. Winning!
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