What do we have to show for it?
The Obama administration is letting several top banks pay back their government/taxpayer bailout money early. True, we collect interest, but not nearly as much as we would have had the banks kept that money longer—which would have been a better payback for the risks taxpayers were exposed to.
But more to the point, the money being paid back is the same money that was lent to the banks so they could, in turn, lend that money back out again to help those facing foreclosure.
However, as we know from the dismal figures now public, the banks, for the most part, weren’t really doing all that much to help homeowners anyway. Instead of loaning the taxpayer bailout money back out, they mostly kept it on their books to make their own balance sheets look better than what they really were (are???).
And, apparently, the banks are more interested in freeing themselves of any government restrictions on executive pay and bonuses that were tied to the bailout money than they are in helping Americans save their homes, stabilize home prices and bring this economic mess we are all in to as rapid a close as possible.
As I wrote about the other week, the banks also managed to derail an attempt to change the law so that bankruptcy court judges would be able to change the actual terms of a mortgage–something they have long been able to do for second mortgages on the vacation homes of the rich and infamous.
Now, the banks will be able to have their cake and eat it,too—freed of the restrictions they so dreaded and freer to keep on doing business as usual–which is good for them, but not so good for —guess who???