Elizabeth Warren discusses the real purpose of TARP

April 18, 2014 | By | Reply More

At Daily Kos, “HoundDog” reviews Elizabeth Warren’s new book, A fighting Chance. Here’s an excerpt:

[Warren] says when she asked Geithner about helping the homeowners struggling to save their homesh he admitted “[d]espite the way it was sold, TARP was about saving banks, pure and simple.” ..He admitted that really was not the goal, she writes.

Elizabeth Warren (Photo by Erich Vieth)

Elizabeth Warren (Photo by Erich Vieth)

“The banks could manage only so many foreclosures at a time, and Treasury wanted to slow down the pace so banks wouldn’t be overwhelmed,” Warren writes, recounting Geithner’s explanation. “And this was where the new foreclosure program came in: it was just big enough to ‘foam the runway’ for them.”

“There it was,” Warren writes. “The Treasury foreclosure program was intended to foam the runway to protect against a crash landing by the banks. Millions of people were getting tossed out on the street, but the secretary of the Treasury believed the government’s most important job was to provide a soft landing for the tender fannies of the banks. … “Oh Lord.”

She praises President Obama for supporting the Consumer Financial Protection Bureau, but always says he has to take responsibility for choosing the team he did.

For more on Elizabeth Warren, see this post I wrote regarding her November, 2013 presentation to the National Association of Consumer Advocates.  The above quote by Warren confirms a similar statement by Neil Barofsky, who presented at an NCLC conference the previous year. Inside the White House, the TARP program was only about attending to the needs and wants of Wall Street banks.   I attended both of these, and the huge rooms filled with consumer advocates much appreciated hearing straight talk from these two exceptional people.

Neil Barofsky at NCLC

Neil Barofsky at NCLC (Photo by Erich Vieth)



Category: Corporatocracy

About the Author ()

Erich Vieth is an attorney focusing on consumer law litigation and appellate practice. He is also a working musician and a writer, having founded Dangerous Intersection in 2006. Erich lives in the Shaw Neighborhood of St. Louis, Missouri, where he lives half-time with his two extraordinary daughters.

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