The Heritage has put together a good summation of the problem that is starting to be even a bigger problem for all of us. It appears that the government wants to save everybody except the taxpayer.
The tune that the congress must sign now is from the old Lawrence Welk show, " stop the bubble 'a machine", or the money machine in this case.
Stay tuned.
The bailout goes awry
December 16, 2008 By Nathaniel Ward
Since politicians in Washington are increasingly treating the Troubled Assets Relief Program as a slush fund for their favored political projects and since there are better ways to deal with future financial crises, the $700 billion Wall Street bailout should be canceled, Heritage Foundation experts say.
"It is time to end the continued use and abuse of TARP funds," Heritage vice president Stuart Butler writes in an article distributed to lawmakers and the media.
More than $360 billion in bailout money is still available, $350 billion of it pending Congressional approval. With such a large pot of money left, politicians are starting to turn the funds—intended specifically to rescue the financial system—to other ends.
For example, Treasury Secretary Hank Paulson has redirected funds to guarantee debt backed by student loans and to help refinance mortgages. And just last week, the White House announced plans to use these funds to bail out the Detroit automakers.
These changes, Butler argues, have "confused markets, reintroduced uncertainty into the pricing of mortgage-backed securities, and triggered a lobbying frenzy for ever-more 'flexible' uses of the TARP funds."
"The only way to prevent further misuse of the program," he continues, "is to end it."
Instead of using TARP bailout funds to solve future financial crises, Butler urges lawmakers to let the Federal Reserve handle the problem. Despite recent "disconcerting" actions, "the Fed is still the appropriate institution to address short-term dislocation in the financial system."
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