If you're worried, follow the money
There are more than a dozen programs involving subsidies of billions of dollars from taxpayers to Wall Street. Fortune Magazine's Allan Sloan tells Renita Jablonski where concerned people should be focusing their attention.
Allan Sloan is a senior editor-at-large at Fortune (APM)
More on America's Financial Crisis
TEXT OF INTERVIEW
Renita Jablonski: The questions around the automakers will probably quiet some of the emotion around things like the $165 million in bonuses that went to AIG employees.
But Fortune Magazine's Allan Sloan says there's a lot more to be emotional about right now. Allan, you say there are more than a dozen programs involving subsidies of billions of dollars from taxpayers to Wall Street. I guess you're talking about everything that's been created since the start of the financial crisis.
Allan Sloan: Right. If you were to go to the Federal Reserve of New York's Web site, there's a list now of programs involving Fed lending -- there used to be three of them. Now, they don't have enough room on the sheet for all of them. So there're 12 or 13 special programs that involve the Fed laying a bunch of cheap money primarily on Wall Street. The FDIC has got several programs where they lay a ton of cheap money on Wall Street. Not to go on endlessly about the toxic assets bailout plan, cause that was last week's story, but if you say it and read that, do a little math, there's a subsidy probably of at least $18 billion a year to Wall Street involved in that. And I suspect if you could add all of these up and I could keep track of them, it's probably $50 [billion], $60 billion a year. Which is a lot more than $165 million, or at least that's what I learned in arithmetic class.
Jablonski: Why do you think it's important to bring this up?
Sloan: I think it's important to follow the money -- which is what they said in Watergate. You follow the money. If you're worried about subsidizing Wall Street, here's much more to worry about. If you don't care, well then you don't have to pay attention. I just give people the option by giving them information, and if they want it great, and if they don't want it, I don't depend on a bonus to live, so I'm perfectly fine.
Jablonski: So if we follow the money and not the noise, as you've put it, what would we find?
Sloan: Well, you'd find that a ton of money is going to Wall Street in probably 15 or 20 different ways. Also, you would discover that the organization that gets the most government money of anybody, which is the federal government, is paying bonuses this year, too. The government's running a trillion-dollar deficit and it's paying $1.5 [billion], $1.6 billion of bonuses. So if you're concerned where your taxpayer money is, is going, maybe you should be concerned about that, too.
Jablonski: Fortune Magazine's Allan Sloan. Thanks so much, Allan.
Sloan: You're welcome, my pleasure to be here.
Comments
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From La Crosse, WI, 03/30/2009
According to Mr Sloan, the government is paying 1.5 to 1.6 Billion in bonuses this year. To whom? For what? This is very bad reporting.
From TN, 03/30/2009
Yup. This is what has people boiling over, seething with hatred. Look at ALL the Wall Street shills in DC. The house, senate, and executive are lousy with shills. We want a new government please.
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