Here are a some updates on a few of my favorite topics.
The White House has announced recent studies indicating that TARP will cost less than anticipated, specifically, no more than $50 billion, and perhaps zero when all the repayments are in. Even if it turns out that TARP costs $50 billion after the final accounting, I still think TARP was worth it considering the personal havoc it avoided. Yes, it was flawed and, yes, it was not executed as planned, but it protected us from a very ugly downside. Banks are very different from normal businesses. They have our money. They play with our money. We need to remember that.
On another matter, the White House announced that taxpayer losses from the auto bailouts are estimated at $17 billion. In fact, because the new GM has not yet reached its goal of 19% market share, some speculate that the IPO may not happen, which will leave the American taxpayer holding the bag for a while longer. Car companies are different from banks. They don’t have our money, or at least they are not supposed to.
Finally, President Obama told the New York Times this week that there is no such thing as a shovel ready project, a major component of the stimulus package. Well, this has opened a Pandora’s box of criticism. The next post will examine the mess that the President has unleashed.
(Tease? That’s what my wife said. She wanted some meat on this last subject, somewhat like the old Wendy’s commercial, “Where’s the beef?” Well, it’s coming. I actually started writing the stimulus part of this post and it just grew and grew and grew. I read a little and wrote a little and suddenly it was bigger and being bigger it deserved its own post. Okay?.........Remember when Walter Mondale tried to use the Wendy’s beef line in a joke during his 1984 debate with President Reagan? Didn’t go anywhere then either….)