The Great Bailout Backlash
By ROSS DOUTHAT
NYT
Nothing in this election season, no program or party or politician, is less popular than the Troubled Asset Relief Program of 2008 — a k a the Wall Street bailout. No policy has fewer public figures willing to defend it, and fewer Americans who believe it worked. No issue has done more to stoke the fires of populist backlash, and the rage against elites.
It was TARP that first turned Tea Partiers against Republican incumbents, and independents against Washington. It was TARP that steadily undermined Barack Obama’s agenda, by making activist government seem like a game rigged to benefit privileged insiders. And it is TARP that’s spurred this campaign cycle’s only outbreak of bipartisanship: as of September, Politico’s Ben Smith noted recently, the two parties had combined to spend about $80 million on attack ads that invoke the bailout, with the Democrats alone accounting for $53 million of that spending.
The question is whether the program’s extraordinary unpopularity is justified. Few elected officials may be willing to argue for the bailout, but plenty of policy wonks will make the case (from the safety of their think tanks) that the Wall Street rescue package is actually “one of the most unfairly maligned policy initiatives of all time,” as the Center for American Progress’s Matthew Yglesias recently put it.
This case was strengthened by the news that the bailout might actually end up costing the taxpayer less than $50 billion over all, rather than the $700 billion originally set aside to pay for it. Moreover, it’s the auto bailout, which the TARP funds eventually underwrote as well, that’s likely to end up being responsible for the bulk of these losses. As it stands, the federal government may actually end up turning a modest profit on the money injected into Wall Street’s failing banks.
(More here.)
NYT
Nothing in this election season, no program or party or politician, is less popular than the Troubled Asset Relief Program of 2008 — a k a the Wall Street bailout. No policy has fewer public figures willing to defend it, and fewer Americans who believe it worked. No issue has done more to stoke the fires of populist backlash, and the rage against elites.
It was TARP that first turned Tea Partiers against Republican incumbents, and independents against Washington. It was TARP that steadily undermined Barack Obama’s agenda, by making activist government seem like a game rigged to benefit privileged insiders. And it is TARP that’s spurred this campaign cycle’s only outbreak of bipartisanship: as of September, Politico’s Ben Smith noted recently, the two parties had combined to spend about $80 million on attack ads that invoke the bailout, with the Democrats alone accounting for $53 million of that spending.
The question is whether the program’s extraordinary unpopularity is justified. Few elected officials may be willing to argue for the bailout, but plenty of policy wonks will make the case (from the safety of their think tanks) that the Wall Street rescue package is actually “one of the most unfairly maligned policy initiatives of all time,” as the Center for American Progress’s Matthew Yglesias recently put it.
This case was strengthened by the news that the bailout might actually end up costing the taxpayer less than $50 billion over all, rather than the $700 billion originally set aside to pay for it. Moreover, it’s the auto bailout, which the TARP funds eventually underwrote as well, that’s likely to end up being responsible for the bulk of these losses. As it stands, the federal government may actually end up turning a modest profit on the money injected into Wall Street’s failing banks.
(More here.)
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