Web site to track TARP spending
To protect taxpayers, Treasury Secretary Timothy Geithner promised more accountability and transparency. So a new Web site will be launched to track TARP spending. But will it work? Nancy Marshall Genzer reports.
Home page of FinancialStability.gov, a Web site launched by the Treasury Department to detail TARP spending. (http://financialstability.gov/)
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TEXT OF STORY
KAI RYSSDAL: Treasury Secretary Geithner made a lot of promises about transparency today. He said the government is setting up a new website to let the public know who's getting government money and how they're using it. Some critics are calling for even more public accountability. Others worry that transparency will spook the markets.
Marketplace's Nancy Marshall Genzer explains.
NANCY MARSHALL GENZER: Treasury Secretary Geithner says the new website, FinancialStability.gov, will show whether federal money is actually increasing lending.
Timothy Geithner: The American people will be able to see where their tax dollars are going, and the return on their government's investment.
The Treasury Department already requires monthly reports from some banks that get the most government cash. They have to disclose loan information and purchases of some securities. But some critics say Treasury is just trying to placate taxpayers.
ROBERT BRUSCA: Transparency is kind of like a magic elixir. It's something that people talk about but nobody drinks.
Robert Brusca is chief economist for Fact and Opinion Economics. He says it's really hard to track how banks spend taxpayer dollars. Even if banks say they're sequestering the money in a special account.
BRUSCA: You're going to be watching religiously things in this one account where the banks want you to look and you're not going to look at other things. No, you want to look at everything that they do.
But some regulators say banks might be skittish about asking for emergency help if they knew the public would find out. And there are concerns that Geithner's new transparency rules could be a little too revealing, undermining public faith in banks and their stocks. On the other hand:
JAMES ELLMAN: We already have a great deal of stock market volatility. We already have very low share prices for these companies.
That's James Ellman, president of Seacliff Capital in San Francisco.
ELLMAN: So I doubt that more transparency would make the situation worse. I think it will make it better.
And Ellman says the government shouldn't hesitate to take over weak banks.
In Washington, I'm Nancy Marshall Genzer for Marketplace.
Comments
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From MI, 04/01/2009
GM should not receive more bailouts when the new CEO will not work for less than 1.3 million per year. These clowns could not manage any business. Too many people are in financial ruin, if this person can't work for less get rid of him.
02/10/2009
Hogwash. The main printing machine is Federal reserve NOT treasury. And there is absolutely no accountability for what Federal Reserve does. According this new plan Federal reserve will spend more than 1 trillion. How they are going to spend is totally secret.
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