Why is our government NOT letting banks repay TARP funds?

First of all the TARP funds were a bad idea, but the federal government’s involvement in the whole Fannie/Freddie mortgage meltdown complicated the matter. Unfortunately during this time of bailouts some of the banks that didn’t need them were REQUESTED to take them. They were told that if they didn’t accept the funds it would look like they weren’t able to qualify for them and it would affectZ their public perception.

Once the loans were administered the rules started to change. The government decided that they should have a say in how these banks ran their businesses, much like they were taking over at GM. More regulations began to be added to the funds, by congress, after the fact.
For banks in a reasonably healthy financial situation, who could raise their own capital, this started to look like a bad deal and an immediate return of the funds seemed like the best answer. Little did they know that the rules are continuing to change. Some have already been able to return the TARP funds with any applicable interest; others have tried and have been delayed. Now they are being told that for “the good of the system” they will not be able to return that money.

WHAT?!

As a tax payer and partial owner of those funds, I say let them come back! And when they come back let the original principle and any interest go straight into paying off the DEBT that we acquired to hand the money out in the first place.

I think it’s time to end these shenanigans (that’s a technical term).

There are a couple of routes to take in order to balance the power that the legislative and executive branches are wielding like Conan in a drunken stupor.

The first and most tradition branch is the courts. Find some legal ground to stand on. There HAS to have been some type of contract that was agreed upon prior to these funds being handed out. You can’t rent a pair of rollerblades without signing a contract so don’t tell me that our elected representatives were handing out BILLIONS of dollars without having SOMETHING on paper.

The second method is the court of public opinion. Banks should buy ads in newspapers and show the paperwork that they have filed to repay the TARP funds. Hold press conferences. Start asking WHY their funds can’t be repaid. Hold up a check for the full amount and demand an explanation of why these funds can’t be repaid immediately. Banks should be the front line in the cheering section to get the government to get OUT of the private sector. They should be the ones arguing and championing the fact that government involvement in the mortgage industry is what got us into this mess in the first place.

Unfortunately we are hearing about ‘bank stress tests’. I’m afraid what these really are, are subjective government ‘evaluations’ of banks. What should be an indicator to banks of improvements that they need to make, may suddenly become a blackmail card. I would hate to think that a good grade depended on TARP funds being on hand.

I’m not a conspiracy follower or creator by nature, but when the government is throwing cash everywhere, coercing and in some cases even demanding that banks or businesses take money, then denying repayment, all the while passing new laws to regulate the very business that they are giving money too, I have to question what the real motive is? What is the government trying to accomplish by repeatedly changing the stipulations of these loans and then prohibiting repayment.

Have you asked yourself that question yet?

When our government says that it is acting for the “good of the system”, what does that really mean?

We’ve ventured down a very dangerous and bumpy road of government involvement and most likely (in my OPINION) a nationalization of some businesses. This is not what is best for this country. It has never been a path of prosperity and stability and never will be.