By “mess,” I mean both the Credit Crunch itself and our collective response to it, at the government and personal levels.
My obsession drives me to read reports by the Special Inspector General for the Troubled Asset Relief Program (SIGTARP). As a first draft of financial history, the SIGTARP reports have become essential to understanding the bailouts of Citigroup, AIG, other TBTF Banks, and smaller banks as well.
Perhaps it’s a function of my low expectations for a government-produced document on finance. Perhaps it’s my contrarian nature. I’m not sure. But I do know there’s something refreshing and downright exciting about the reports coming from the office of the SIGTARP.
I love SIGTARP so much I want to highlight the key things everyone should know from the reports, on the off chance you aren’t as obsessed with reading government documents as I am.
Two great things, just for starters, to know about SIGTARP’s reports. First, they’ve got the ring of honesty. Second, they remind me why I do have faith in our system of government and finance, despite all the reasons to lose faith, and despite all the crazy fringe talk we get bombarded with on a regular basis.
In the April 2012 report, just to cite one happy example, you will find such pleasing curiosities as a Treasury official who tells you her colleagues in another part of Treasury are lying to you, to wit:
“It is a widely held misconception that TARP will make a profit. The most recent cost estimate for TARP is a loss of $60 Billion. Taxpayers are still owed $118.5 billion”
Now that’s what I’m talking about! Some straight talk from the federal government.
Another example of facts cutting through the haze of political speak:
“TARP’s explicit goals of preserving homeownership and promoting jobs were evidence that Congress wanted to help homeowners during the crisis, not just banks. However…Only 9% of the TARP funds set aside for mortgage modifications have been spent to help a fraction of eligible homeowners after more than three years…after two years, only 3% of the funds obligated [for the Hardest Hit Fund] have been spent to help only approximately 30,000 homeowners.”
In other words, the government’s largest federal programs for mortgage modification and homeowner relief are poorly designed or poorly implemented, or both.
I’m not happy about this. But I don’t particularly care to blame Congress, or the President, or a bunch of nameless bureaucrats we’ve never heard of.
I am happy, however, to read a technocratic document like SIGTARP’s quarterly report that gives me the hstraight dope about what is working and what is not working in the financial bailout. The honesty of the reporting gives me hope that people are willing to work on practical data, practical solutions, and do not seek to score points against the other side only for ideological reasons or political gamesmanship.
Too often we fall down the rabbit hole of financial discourse online, where the avatars of pitchfork wielding right-wing trolls do imaginary battle with the avatars of left-wing demagogues who make the Scarecrow’s Occupy Gotham scene seem like a plausible near-future alternative. I’m pretty sure Dark Knight villains Two-Face, Bain, Joker, and the Scarecrow actually exist, because I feel like I read their stuff in the comments section of respectable online financial outlets.
It’s enough to induce despair, which is always the goal of the Dark Knight’s foes. That forum has plenty of Gotham-City shouting and fear-mongering but precious little listening, and even less understanding or analysis.
Who can fight against the financial darkness? SIGTARP can.
Would you like to feel better about our country and the government’s ability to self-criticize and therefore, possibly, learn from its mistakes? I suggest you brew some tea and curl up with a nice SIGTARP report sometime. You’ll feel a lot better.
 Too Big To Fail, but you knew that.
 Meaning: Please pay no attention to my Treasury colleagues quoted in the Wall Street Journal who wrote the following “Overall, the government is now expected to at least break even on its financial stability programs and may realize a positive return”
 You have to admit SIGTARP does sound like Norse God, no?
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