"The "Culture of Bailouts' must end."
Most economists and many Republicans, including myself, considered the Troubled Asset Relief Program (TARP) necessary because the economy was on the brink of collapse and doing nothing would have likely led to a complete financial meltdown. It helped stop economic panic, and now, all of that money must be, and is being, paid back by the banks as was intended. But I opposed Washington's decision to use the unspent portion of emergency TARP funds as an all-purpose federal slush fund.
TARP has morphed into a $700 billion slush fund that went far beyond the financial system. Politicians used it to bail out auto companies (GM and Chrysler) and insurance firms (AIG) while financing mortgage modifications. It is time we immediately shut down TARP and use all unspent or paid-back portions of the program to pay down the debt. I oppose the use of TARP funds for public programs, subsidies and bailouts.
The President has proposed a new tax on banks to recoup roughly $120 billion in TARP funds, even though the majority of TARP funds that went to banks have already been paid back. Most of the funds that were not recouped were used to bail out AIG, GM, Chrysler, Fannie Mae and Freddie Mac -- none of whom should have been bailed out to begin with. I oppose this proposal because it raises taxes during a recession and it will make it more expensive for people and businesses to borrow money as banks pass those added costs onto consumers.