BailoutWatch.net continues to track the latest news, events, federal reports, and other useful resources related to the federal bailout. This entry, our third "Project Update," highlights some of the work of our Bailout Watch project partners. While the majority of the work reported in the Update is posted on this site as it is released to the public, the "Project Update" makes it easy to keep up with what organizations are doing to research, investigate, and analyze the federal government's actions during the bailout. "Project Updates" are posted once every two months.
BailoutWatch.net is maintained by OpenTheGovernment.org.
Economic Policy Institute (EPI)
EPI continues to plan and host monthly forums on bailout-related issues as part of its Bailout Analysis Project. The first forum, titled “Community Banks in the Bailout” and held on June 10, explored the bailout’s impact on the nation’s 8,000 community banks. Notable speakers included Christopher Whalen, managing director of Institutional Risk Analytics. Also, Karen Thomas, executive vice-president for governmental affairs for the ICBA as well as William Dunkelberg, professor of economics and co-founder of New Jersey’s Liberty Bell Bank. (See the video here). During the second forum, titled “The Federal Reserve’s Exploding Balance Sheet” and held on July 15, panelists examined the Federal Reserve, its history of secrecy, and its expanded role in the financial crisis. With an opening keynote speech by Senator Bernie Sanders, the diverse panel of speakers included former Fed economist Jon Faust, director of National People’s Action, George Goehl, veteran journalist who wrote the classic 1987 book on the Federal Reserve, Secrets of the Temple, William Greider, and CEPRS’s Co-Director, Dean Baker.
Most recently, EPI has held a third forum on September 9, “What to Do About Too Big to Fail.” The event features panel speaker Simon Johnson, MIT Sloan professor and creator of the popular blog, The Baseline Scenario. Other notable speakers included AFL-CIO Associate Counsel member of the Congressional Oversight Panel, Damon Silvers, Federal Reserve Bank of Minneapolis consultant, John H. Boyd, and President of the American Antitrust Institute, Albert A. Foer. (See panel highlights here).
On September 24, EPI co-hosted an event with Demos, The American Prospect, and Americans for Financial Reform. Demos Senior Fellow and former Goldman Sachs Managing Director, Nomi Prins, was invited to discuss her new book, It Takes a Pillage: Behind the Bailouts, Bonuses, and Backroom Deals from Washington to Wall Street. EPI’s Research and Policy Director, John Irons, led a discussion about financial responsibility with President of Public Citizen, Robert Weissman, and Executive Director of Americans for Financial Reform, Heather Booth. (Video will be posted shortly. Additional event information here).
EPI also released three articles and a snapshot piece on financial markets and bailout analysis, authored by Nancy Cleeland and Lucas Puente. These include “Ray of sunshine for gloomy financial skies?” (see article here), “Payback time” (see article here), “Beyond Goldman Sach’s second quarter profit” (see article here), and “The Federal Reserve’s exploding balance sheet” (see article here).
Dates and details about future Bailout Analysis Project forums will be posted on the BailoutWatch.net Calendar as they are announced.
Center for Economic Policy Research (CEPR)
Over the summer, CEPR continued its analyses and critiques of the Bailout and focused special attention on subsidies to "Too Big to Fail" banks, the lack of transparency at the Federal Reserve, and Ben Bernanke's performance. Highlights include:
CEPR calculated the implicit taxpayer subsidies to "Too Big Too Fail" banks in a new report, “The Value of the 'Too Big to Fail' Big Bank Subsidy.” The report shows that since the collapse of Lehman Brothers last fall, the TBTF banks have been allowed to borrow money at much lower rates than small banks, implying a redistribution of money from taxpayers to the very banks that were bailed out last year.
On the eve of the anniversary of the collapse of Lehman Brothers, the Guardian online published Dean Baker's column, "Heroes of Wall Street," which reminded readers that the Federal Reserve and U.S. Treasury focused on protecting the major banks in the wake of Lehman's collapse. In the weeks leading up to the anniversary, the Guardian online posted several other essays by Dean assessing the bailout and its major actors, including "What Exactly Did the Fed Do with $2 Trillion?" "Reverse Bank Robbery," "Goldman Sach's Golden Parachute," and "Ben Bernanke's failure at the Fed."
- In their coverage of the announcement of the reappointment of Ben Bernanke in August, many major media outlets, such as the New York Times, the Houston Chronicle editorial page, and the Boston Globe, cited Dean's critiques of Bernanke's actions both before and during the financial crisis.
- In addition to regular posts about the Fed and Bernanke on his blog, Beat the Press, Dean posted about the New York Times' misleading tally of the bailed-out banks and the Washington Post's article on concentration in the banking industry as a result of the financial crisis.
OMB Watch has been advocating for financial transparency in government by monitoring developments in the $700 billion bank bailout program, TARP, in congress, at the Treasury Department, and at the Federal Reserve Bank. As part of this effort, OMB Watch has been tracking legislation related to TARP and larger bailout efforts from Congress and compiling the information into a publicly-accessible spreadsheet.
OMB Watch also continues to write about TARP on OMB Watch's blog, The Fine Print, and in OMB Watch's bi-weekly newsletter The Watcher. Our focus on transparency includes not only information on following TARP funds (Treasury's Shrewd Investment?; How Can You Get Treasury to Stand Behind You at the Roulette Table?; TARP'd Citigroup Leverages Again, and more ), but also on lobbying disclosure (TARP Recipients' PACs and Lobbyists Donated $6 Million and Hosted 70 Fundraisers for Members) and transparency in financial system beyond institutions participating in TARP (Commentary: Obama Reform Proposal would Improve Transparency in Financial Markets and Regulating Credit Rating Agencies).
Project on Government Oversight (POGO)
POGO has continued to provide commentary and analysis on its blog about a wide range of bailout-related issues, including PIMCO's role in the Term Asset-Backed Securities Loan Facility, the SIGTARP's recommendations for limiting outside influences on the Capital Purchase Program, the need for greater regulation of credit rating agencies, the administration's proposal to regulate Over-the-Counter derivatives, the reappointment of Ben Bernanke and the need for greater transparency at the Fed, the end of a conflict between Treasury and SIGTARP, Treasury's new general counsel George Madison and his apparent conflicts of interest, the Congressional Oversight Panel's report on the auto industry bailout, a Senate hearing on the one-year anniversary of TARP, an IG report on the SEC's failure to detect the Bernie Madoff Ponzi scheme, and the approval of the first set of asset managers for the Public-Private Investment Program.
Taxpayers for Common Sense (TCS)
Check out TCS' detailed biographies of bailed-out banks. The bank biographies offer a wealth of detailed information on the institutions helped by the Troubled Asset Relief Program (TARP), and are an invaluable resource for journalists, researchers, and citizens.