$700 Billion TARP Bailout? Not Even Close….

   … as Hunter at Daily Kos points out. Let’s try trillions instead.

Fed commitments to financial sector topped $7 trillion      Mon Nov 28, 2011

Bloomberg News sorts through how the Fed handled the banking crisis. It isn't pretty:

The amount of money the central bank parceled out was surprising even to Gary H. Stern, president of the Federal Reserve Bank of Minneapolis from 1985 to 2009, who says he “wasn’t aware of the magnitude.” It dwarfed the Treasury Department’s better-known $700 billion Troubled Asset Relief Program, or TARP. Add up guarantees and lending limits, and the Fed had committed $7.77 trillion as of March 2009 to rescuing the financial system, more than half the value of everything produced in the U.S. that year.

“TARP at least had some strings attached,” says Brad Miller, a North Carolina Democrat on the House Financial Services Committee, referring to the program’s executive-pay ceiling. “With the Fed programs, there was nothing.”

One of the underlying themes of the article is that almost nobody contacted for the story, whether in government or in the large banks, was willing to comment on it. And during the debates over both TARP and bank regulation, the scale of secret government assistance to the largest banks was unknown even to Congress:

Lawmakers knew none of this.

They had no clue that one bank, New York-based Morgan Stanley (MS), took $107 billion in Fed loans in September 2008, enough to pay off one-tenth of the country’s delinquent mortgages. The firm’s peak borrowing occurred the same day Congress rejected the proposed TARP bill, triggering the biggest point drop ever in the Dow Jones Industrial Average. (INDU) The bill later passed, and Morgan Stanley got $10 billion of TARP funds, though Paulson said only “healthy institutions” were eligible. [...]

Byron L. Dorgan, a former Democratic senator from North Dakota, says the knowledge might have helped pass legislation to reinstate the Glass-Steagall Act, which for most of the last century separated customer deposits from the riskier practices of investment banking.

“Had people known about the hundreds of billions in loans to the biggest financial institutions, they would have demanded Congress take much more courageous actions to stop the practices that caused this near financial collapse,” says Dorgan, who retired in January.

Now that the information is coming out, will that make a difference in future discussions over regulating too-big-to-fail banks? Color me skeptical. Lawmakers might grumble a long while about the Fed committing the United States to seven freaking trillion dollars in loans and guarantees to the financial industry, but government is still quite thoroughly captured by the top banks:

At the meeting with [Sen. Ted] Kaufman, [Treasury Secretary Timothy] Geithner argued that the issue of limiting bank size was too complex for Congress and that people who know the markets should handle these decisions, Kaufman says. According to Kaufman, Geithner said he preferred that bank supervisors from around the world, meeting in Basel, Switzerland, make rules increasing the amount of money banks need to hold in reserve. Passing laws in the U.S. would undercut his efforts in Basel, Geithner said, according to Kaufman.

Technorati Tags: Federal Reserve,The Economy,Bank Bailouts,TARP,Timothy Geithner,Congress,Morgan Stanley

Would Jesus Join the Occupy Protests?

Published on Saturday, November 26, 2011 by Consortiumnews.com

by Rev. Howard Bess

When the Martin Luther King Jr. monument was dedicated recently in Washington DC, I was reminded that the civil rights movement in America was led not by a politician fulfilling campaign promises, nor by a popular evangelist bent on saving souls, but by a highly trained theologian who put his religious teachings into practice with a demand for justice for those who had suffered at the hands of the rich and the powerful.

The Rev. King was a Baptist preacher who took his religion into the arena of racism, economics and social disparity. However, hatred caught up with him, and he was killed.

Now, nearly a half century later, there is another broad-based protest that is gaining momentum. The Occupy Wall Street protests echo some of King’s complaints about economic inequality and social injustice – and the message can no longer be ignored.

The significance of this latest public protest movement, erupting all over the country, may eventually rival the impact of the civil rights movement of the 1960s, yet when comparing the two movements, there is one glaring difference: priests, pastors and clergy of every stripe are rarely in the forefront of Occupy protests.

Instead, secular young people are doing the very work that Jesus from Nazareth would urge us to do. Just as Jesus condemned the injustices of his own day – and overturned the money-changing tables at the Temple – the Occupy protesters are challenging how Wall Street bankers and today’s rich and powerful are harming the masses of people.

This week, religious people have felt proud of giving turkeys to the poor, but they should be joining the protests against the haughty rich. I maintain that Jesus would be a part of the actions in Portland, Denver, New York and many other cities. For Christians, the crucial issue should be “what would Jesus do”?

Today, Christian theologians and Bible scholars agree that the Jesus trip to Jerusalem at the end of his life is essential to understand what Jesus was about. Yet, Christian tradition has brainwashed followers of Jesus about the realities of his trip south to Jerusalem. We have all been exposed to the worship services in which children march waving palm branches and singing “Hosanna.”

Traditionally we have called the event “the triumphal entry.” However, put into the political and social context of Jerusalem in the early first century BCE, Jesus riding into Jerusalem on a donkey was probably more like a protest march that mocked every leader in the city.

Political and religious “leaders” of the day probably would have ridden into town on a prancing horse, certainly not a humble donkey. So, Jesus’s choice of transportation was more street theatre than triumphal entry. It triggered a week of confrontations and arguments with the leaders of state and Temple.

The key event of the week was the incident in the Temple. Once again church tradition has given us a special name for the incident, “the cleansing of the Temple.” But It was more likely another piece of street theatre that became a bit physical.

To better understand the Temple incident, we need to understand its context. The Temple had become a lot more than a religious temple. It had become a tax collection agency and a bank. The Temple held large sums of money accumulated by collecting tithes from the faithful.

In reality, the tithe was a tax, not a freely given gift to God. In addition, fees were charged for participation in the Temple’s religious exercises.  So, the Temple collected lots of money.

With that fat treasury, the Temple had entered the banking business and regularly made loans, primarily to poor people. Poor people were the victims not only of a flat tax, but also high-interest loans. So, the gap between the haves and the have-nots was growing rapidly. The poor were getting poorer, and the rich were getting richer.

Yet, equity was a key concept in the Israelite tradition. Torah (the law) had very specific rules demanding systematic redistribution of wealth. But those who controlled the Temple operation completely ignored their own religious teachings. The banking operation that had developed was very good to those who controlled the system.

Christians believe that Jesus Christ died for the sins of the whole world. However, from the perspective of history, Jesus died because he challenged a banking system that passed itself off as being righteous.

Today, bank buildings are the temples of America and the financial industry is a key pillar of an increasingly inequitable economic system. Although banks and their controlling officers claim to be upholders of orderly American life, a growing number of people know better.

Recent surveys have asked people “who in the banking business do you trust?” Credit unions came out on top, followed by locally controlled banks. Then, came regional banks. Large national banks came in dead last.

Christians should thank the current Occupy Wall Street protesters for their message and their activism. They are doing our justice work for us. The current crop of national bank leaders are being shown to be just as corrupt as the Temple bankers were in Jesus’s day.

If Jesus were present among us today, he would be moving from Portland, to Los Angeles, to Kansas City, to Dallas, up to Chicago and on to Wall Street in New York City.  He would join the protest in every city. He would be demanding an overhaul of our financial and banking system. He would be standing with the poor and their allies — and against the rich and their protectors.

When Jesus pursued the corruption of his own day, the representatives of the religious and political status quo killed him. And Jesus said to his followers “take up your cross and follow me.

© 2011 Consortiumnews.com  

The Rev. Howard Bess is a retired American Baptist minister, who lives in Palmer, Alaska. His email address is hdbss@mtaonline.net.

Technorati Tags: Jesus,Christ,OWS,Occupy Wall Street,Wall Street,Bankers,Howard Bess,Current Events,An American Gothic