They Don’t Call It TARP For Nothing
You can’t see under it.
While we might be a bit concerned about Recovery.gov’s reporting practice for a bunch of ham, the problems with the TARP bailout program are so much worse. Witness the testimony that Neil Barofsky, Special Inspector General for TARP, plans to give on the overall lack of transparency in the program:
In particular, SIGTARP highlights four specific areas in which recommendations for making the financial industry bailout more accountable and open, have gone unheeded. Treasury has not committed itself to providing taxpayers with updated information on the financial performance of its TARP investments, according to Barofsky’s prepared statement. It has not acted on a recommendation that [Term Asset-Backed Securities Loan Facility] borrowers who fail to repay their loans be identified. It has not required the disclosure of “all trading activity, holdings, and valuations of assets of the PPIF” on a timely basis. And perhaps most significantly, Treasury has declined to require all TARP recipients to report on the actual use of TARP funds — notwithstanding a few agreements with Citigroup, Bank of America and AIG.
“Treasury has declined to adopt this recommendation, calling any such reporting “meaningless” in light of the inherent fungibility of money,” Barofsky will testify. “SIGTARP continues to believe that banks can provide meaningful information about what they are doing with TARP funds.”
“In rejecting SIGTARP’s basic transparency recommendations, TARP has become a program in which taxpayers (i) are not being told what most of the TARP recipients are doing with their money, (ii) have still not been told how much their substantial investments are worth, and (iii) will not be told the full details of how their money is being invested,” Barofksy adds. “In SIGTARP’s view, the very credibility of TARP (and thus in large measure its chance of success) depends on whether Treasury will commit, indeed as in word, to operate TARP with the highest degree of transparency possible.”
The TARP program has been in effect since last October and over two administrations and we have seen hardly any progress towards more transparency in the program. Pretty lame. Maybe they’ll actually listen to Barofsky’s suggestions for once.