It’s official: Washington has no idea what it’s doing.
This is a video of Senator Jim DeMint (R-SC) questioning Treasury Secretary (and tax cheat) Timothy Geithner over the $700,000,000,000 bailout rescue plan (aka TARP).
Now, there’s a couple of parts to this video.
First, Sen. DeMint asks Geithner about the repayment of the bailout money. If a bank pays the government back $50 billion, he wonders, would that money go back into the general fund to be used elsewhere, or would it be re-loaned to other banks? Geithner says both.
Huh?
Geithner tells DeMint that the way TARP is designed, that $50 billion repayment would go back into the general fund, but the government would also then be able to loan out another $50 billion, in essence turning $50 billion into $100 billion. If that’s true, then TARP isn’t a one-time fixed bailout loan, but rather a perpetual debt-creating machine.
Either that, or Geithner just doesn’t know how math works. Which is also entirely possible.
Second, Sen. DeMint asks the math-challenged Treasury Secretary about the government’s plan to relinquish ownership of companies like GM and AIG. Geithner answers that he “thinks about it a lot” but it’s “too early to do that now”. That may be true (if you buy into the bailout philosophy), but DeMint’s question wasn’t so much about when but more about how. And Geithner’s answer proves he has no idea.
The reality is, the government has no clue how to get out of the business of owning businesses. It moved full steam ahead, throwing hundreds of billions of taxpayer dollars at banks and insurance companies and automakers, buying up banks, buying up bad loans, guaranteeing auto warranties, even taking over GM and forcing Fiat to take Chrysler, and it did it all without any exit strategy.
And the media wonders why the American people have a problem with that.
Previously:
$700 Billion bailout ‘letting’ the banks win?
‘Dude, where’s my $700 billion?’
Second half of bailout: How ’bout a little oversight this time?
US Bancorp CEO rips TARP, promotes faith
Actual cost of TARP bailouts: $2.9 trillion
