The Big Float's a Big Scam
WikiLeaks may be the biggest information explosion this week, but Wednesday's mammoth release of documents pertaining to the Fed's bank bail out program could well spark the most outrage -- at least among those not fortunate enough to head a firm on Wall Street.
The Federal Reserve, we know, floating cash all over the place in the cold months of '08 and '09. But not just to Wall Street. Apparently Harley-Davidson and Verizon were also “too big to fail."
And the government purchase of commercial paper—very short-term loans to businesses to help them meet cash-on-hand obligations—is the new news in this story. 21,000 commercial loan records have also been released under new financial regulatory legislation.
Some of the biggest users of the Fed's expanded lending were Goldman Sachs, who claimed they didn't need assistance. Goldman hit up the Fed 84 times to borrow nearly $600 billion. GE, parent company of NBC, got $16 billion from the Fed -- all this, let us not forget, while credit for the rest of us was frozen over.
Senator Bernie Sanders of Vermont, who wrote the provision requiring these disclosures, noted that the Fed could have forced the companies they helped to restrict executive pay and lighten the burden on mortgage holders. But they didn't. Instead, the Fed loaned out trillions while families lost their homes. $3,300B in taxpayer cash went to private banks abroad while half a million Americans a month were losing their jobs.
Did Congress authorize our Fed to become the world's private banker? That's a question voters have a right to ask their politicians. While the GOP grandstands over shutting government down if they don't get tax breaks for the wealthy, it just may be there's a message on which actual voters -- from the Tea Party to the block party -- can agree.
And that's this: Dear Congress: you know what? Go ahead, shut -- until you can prove that you're doing as much for us as you've done for a group of enormously powerful people -- who today in many instances are making even more money than they did before they were bailed out by the taxpayers.
The F Word is a regular commentary by Laura Flanders, the host of GRITtv and editor of At The Tea Party, out now from OR Books. GRITtv broadcasts weekdays on DISH Network and DIRECTv, on cable, and online at GRITtv.org and TheNation.com. Follow GRITtv or GRITlaura on Twitter and be our friend on Facebook.