TARP: A New Slush Fund for Washington

  • The President today announced his intention to tap billions of dollars in Troubled Asset Relief Program [TARP] funds to justify additional economic “stimulus” spending.
  • This is the latest version of the administration’s exploitation of TARP for purposes other than stabilizing financial markets; and it ignores taxpayer protections built into the law that ensured TARP funds would be repaid to the Treasury and not used to increase spending, deficits, and debt.
  • Earlier this year, the administration used TARP to purchase two auto companies and to subsidize over-extended mortgage holders who failed to meet their payments, at an estimated cost to taxpayers of $109 billion.
  • Thus, after the intense opposition to TARP as a “Wall Street” bailout, two great ironies are now emerging: 1) the cost for meeting TARP’s original purpose has declined dramatically; and 2) the administration now seeks to exploit this reduction to further increase spending, deficits, and debt – all under the false claim of “fiscal responsibility.”

Read the full report here.