Political Memes

It was far more dystopian than all that.

So Obama pushes through tarp. 443.5 billion dollars are moved from the public trust to 1%er CEOs. The CEOs promise trickle down. The CEOs don't deliver trickle down. As a show of gratitude, they SLOW THE INCREASE of profit margins, they do not LOWER PROFIT MARGINS in an act of trickle down. They pocket the 443.5 billion real dollars that were collected from common people via taxes.

Obama then asks for the 443.5 to be repaid, but sure as shit, those 443.5 billion dollars are not leaving 1%er pockets.

The CEOs go to big banks and say "I owe Obama 100 billion dollars. Would you value my company at 100 billion dollars, create an unsecured equity security (the oxymoron, unsecured security, amirite?) and give me 100 billion dollars to give to Obama."

The bank CEO says "Absolutely. I will take 100 billion real dollars that people have put into this bank as savings and give those dollars to you, so you can give them to Obama, and in exchange, I will have this abstract imaginary unsecured equity that says you owe me 100 billion dollars, and I will let you do that because IF I ever enforce repayment, in theory, you can sell your company for 100 billion dollars. I don't plan to ever enforce repayment (favors among 1%s and all), and if I did, you could file bankruptcy and since the equity is unsecured, it would probably be discharged, in which case the 100 billion fake dollars I 'have' disappear into smoke, so if there comes a day that all of the people at my bank want to withdraw their savings, that money simply will not exist anymore and they will be told 'tough shit' while I jump on a private jet to Aruba Enron style."

So to simplify it: Americans paid for the money to be given to the CEOs through public trust, then Americans paid for money to be given to the Federal government through private banking institutions.

It was all a giant money laundering scheme that enriched the 1%ers, kept the Federal Government at the same level, and cost the American people 887 billion dollars. Interest rates go up, everyone gets bled more aggressively by their debt, banks and CEOs get ballsier about how hard they can fuck the American people with impunity.

Saying the bailouts were paid back is like that joke about the captain was sober today (which you should read if you don't know it cause it is funny). It is technically true but it highly misleading.

• The bailouts were paid back but the excessive reserve funding was not. The reserve funding was multiple times the size of the bailouts
• There was an inflationary spike during the time so even with interest the amount paid back bought less.
• Due to stressing testing the entire midsize banking sector was shutdown by the US government. Effectively eliminating the competition for Goldman and other receivers. The stress testing also allowed AIG to not pay out. The last point is important. AIG was supposed to be insurance and the government allowed them to not do the one thing insurance is supposed to do. Even today there are less banking companies in the US compared to 2007 and the population has gone up by about 30 million. A 10% increase of customers in a market that has much less competition
• The bailout of GM and the airlines gets buddled in with the Banking bailout. GM of course never paid back the 45 billion dollar stock swap but did pay back the small loan. The airlines didn't even do that much. As part of the GM bailout they were able to get sweet deals like not having to deal with lawsuits from problems with Saturns for example, despite federal requirements.
• The banks took advantage of the destroyed competition by the US government. That's why if you had an account during those years chances are it was sold to one of the big players. Did you get the free checking and overdraft protection carried over? No of course not. In violation of established law the banking regulators allowed sold accounts to be treated like new accounts.
• The banks totally misrepresented their situation. Yeah yeah Barnes. I don't care. The last year of operation the CEO received 750 million dollars in bonuses alone. This does not even come close to what he received by other means and what the C suite got as a whole. Bankruptcy for a bank is not the same as real bankruptcy. Me or you we go bankrupt we eat ramen for the next 5 years. Corporate bankruptcy is "I think I could shutdown shop and make more money that way instead of continuing". There was zero danger of you going to your bank account and they couldn't give you your money. FDIC stood ready to inject 100s of billions in cold hard cash. If any of the big banks suddenly went over it would have sucked for the average person for a single weekend. Most of the toxic assets has already been moved on to pension funds anyhow.

TL:DR imagine I gave you Delaware and 5 dollars, you paid me back 6 dollars and never shut the fuck up about how you paid your debt.

Because people don't understand how fucked we were and the complete implications of the total economic collapse that was about to happen. It was a very good deal for the US economy.