Total bailout/stimulus/QE cost is $5.3 trillion - according to Ron Paul

According to a tweet from Ron Paul:

'Total spending on bailouts, stimulus and QE is over $5.3 trillion, or $17,000 for every man, woman and child in the country...'

http://twitter.com/#!/RepRonPaul/statuses/91916947020722178

http://paul.house.gov/

 

So instead of giving $68,000 to an average family of four. The government saw fit to give most of it to banks and major shareholders.

That's big government for you.

They are the Dennis Moore's of America - they take from the poor to give to the rich.



[ame="http://www.youtube.com/watch?v=qLkhx0eqK5w"]‪Monty Python - Dennis Moore‬‏ - YouTube[/ame]

 

[ame="http://www.youtube.com/watch?v=gG3AKoL0vEs"]‪The Broken Window Fallacy‬‏ - YouTube[/ame]

 

in 2008 they should of just let the banks fail and take their lumps!

 

BTW - not that I am for giving $17,000 to every American.

But better that then giving it to banks and major Wall Street shareholders.

 

The economy wouldn't have gone down the tubes in the first place if it wasn't for Alan Greenspan's low interest rates.

 

yes I know, and this is the problem...when you artificially lower interest rates to create an artificial boom then you must suffer the hangover later ( the recession)

 

Yup... and that's the problem with government managing the economy. When the government screws up, it seems logical that they would have to pay for it -- but Alan Greenspan doesn't make that much money. So... either the companies who wanted no part of this have to pay for the government's mistake or everyone else does. Letting the companies pay for it is obviously the better option, but it would be better to simply eliminate the Federal Reserve so these situations don't happen.

 

I agree with you.

Greenspan took the prime rate from 9% in Jan. '01 to the lowest rate since 1958 (4%) in less then 2 1/2 years and he expects that the economy will not be flooded with TONS of debt?

How economically naive can one be?

http://www.wsjprimerate.us/wall_street_journal_prime_rate_history.htm

Just as the Fed (apparently) helped over-stimulate the economy on the 1920's and helped to sew the seeds of the Great Depression - so did Greenspan's Fed do the same sort of thing with the housing boom/bust.

 

Did you listen to Bernanke's response to Paul's claim? Bernanke said that most of that money was lent to banks and repaid already in fact at a profit of $125 billion.

Whether or not that is true is beside the point, one must now research the topic to determine what is fact and what is fiction.

Had the federal government simply lent each American family of 4 $68K and expected it to be repaid already with interest I don't think that would have done any good either.

 

But that's not profit.

They are printing money out of thin air and using that to (among other things) buy up toxic assets. These toxic assets are not 'toxic' because they are great investments and easy to liquidate at face value. They are toxic because they suck.
Now on the books they look okay. But ask the Fed to try and sell those toxic assets tomorrow and see what they would get for them. I would guess only a fraction of what they gave the banks for them. Possibly a tiny fraction.
Imo, there is NO WAY that the Fed has made profit since the crash except on paper. But that is not in real terms...no way.
You cannot print money out of thin air, buy up 'assets' that no one else wants on a dollar for dollar ratio and turn around and realistically say that you have made a profit.


And that $17,000 per person is not a loan - it would be a handout.

It would be like the small stimulus checks Bush Jr. handed out to so many people back in '08. Except this time the amount would be $17,000 each.


And I do NOT agree with either (as I typed).

But if I had to do either, I would rather give the money to the American people who need it the most rather then give it to those that - in most cases - need it the least (major banks and major corporate shareholders).

 

But first you must force the people to suffer the losses you incurred under the bust, and keep the profits you made on the boom.

Have your politician friends tell them that they were saved by the bankers' good fortune. Then buy up all of the assets on the cheep when everything crashes.

 

but the ones that caused the problem would not be riding into the sunset with massive wealth.

 

buy low and sell high

 

much easier to buy after hundreds of billions of dollars are taken from someone else and given to you.

 

the problem with the political system right now in the US is that the bankers have hijacked washington......look at Geitner, Bernacke, and I believe Paulson too!

 

it's easy to accumulate wealth preserving tangible assets when the government gives you hundreds of billion$, and you can spend them now before their full havoc is released on society.

Must be nice to have an uncle sam.

 

Maybe I missed it, but I'd like to see what the facts are. Especially since it's Ron Paul, who's not exactly known for getting his facts straight.

First, how many decades is he saying the cost is over? Second, where is he getting his numbers from? and third, is this also including the lost revenues from the GOP's housing bubble going bust?

 

When did he not get his facts straight?

 

1) When did Ron Paul not get his facts straight? I am sure he has made a mistake or two - but I have found him to be far more accurate then most politicians.

2) Decades?

Here is just a quick total off the top of my head of bailouts, QE's and stimuli in only the last 3 years:

QE1 - $1.7 trillion (and there are rumors it was MUCH higher)
QE2 - $600 billion
Stimulus 1 (under Bush Jr.) - $154 billion
Stimulus 2 (under Obama) - $787 billion
Fannie/Freddie bailout - $317 billion according to CBO - http://www.cnsnews.com/news/article/true-cost-fannie-freddie-bailouts-317-bi
AIG bailout - $170 billion http://articles.cnn.com/2009-03-15/...ilout-money-bonuses-and-compensation?_s=PM:US
TARP - $75 billion still apparently outstanding
GM bailout - $30 billion still outstanding http://www.nytimes.com/2010/05/02/business/02gret.html
Bear Sterns - $30 billion

That is $3.863 trillion dollars in only the last 3 years just off the top of my head.

 

BTW - although not an expenditure per se - the Mark-to-Market rule changes in early 2009 'saved' the banks HUGE amounts of money. Certainly hundreds of billions (I would guess).

And I believe that extra money (which is only on the books, btw) could open the banks up to much more debt and trouble. And that could come back to really bite taxpayers on the butt if they are forced to bailout the banks again and have to fork over hundreds of billions more just because of the accounting changes the banks were allowed to make thanks to the Mark-to-Market rule changes.

BTW - Mark-to-Market rule changes for the banks very basically (as I understand it) allowed banks to mark properties that they are stuck with as they see fit as opposed to what they are actually worth. So they can make their books seem much better then they actually might be.
As an example, if a bank has a property that is presently valued at $300,000 - they used to have to value it on their books at $300,000. Now (apparently), they can mark it on their books at what it was worth before the real estate crash - say $600,000 (or even possibly higher if they wish).
So now that $400,000 mortgage they have on the property looks much better then it actually is.

 

Right around the time he started calling for a return to the gold standard.

 

Funny. His "facts" are usually ideological claims, and not facts at all. He usually loses on the factual basis whenever he espouses Austrian School claims.

How much has been paid back?

 

So you have no proof whatsoever.

QE1 and 2 - ZIP in that the Fed is still stuck with diminishing value toxic assets and Treasuries that they paid for with money printed out of thin air
Stimulus 1 and 2 - ZIP
Fannie/Freddie - no idea (not much to my knowledge)
AIG - no idea (but I believe the Fed/fed gov't. still owns the lousy company)
TARP - ZIP (but some of that $75 billion still owing maybe paid back by now)
GM - ZIP (the gov't. already said most will never be paid back)
Bear Sterns - ZIP (to my knowledge)

 

Ron Paul has none.

So. you have no facts, just guesses.