Are You Outraged?

Earlier this month, a coalition of 78 groups, led by the National Taxpayers Union and Openthegovernment.org, sent a letter to Congress calling on representatives to make the financial-industry bailout program more transparent. The letter noted that nearly half of the funds approved for the Troubled Asset Relief Program have been allocated "with very little transparency and almost no oversight.'' The groups urged Congress to require the Treasury Department, the Federal Reserve and other agencies to collect information on how the bailout money is being spent by the recipients and to make their findings available to the public.

The groups said in their joint letter that the Federal Reserve -- which does not require Congressional approval to provide money to banks and other financial institutions -- has provided at least $800 billion in aid without providing any specifics. "The public deserves vigorous, timely and easily accessible disclosure of all details surrounding any government decisions regarding financial market problems,'' the groups wrote.”We ask that you honor this by making sure that robust and effective oversight occurs and that all relevant records are collected and publicly available.''

Earlier this month, Bloomberg News filed a lawsuit against the Federal government using the Freedom of Information Act. The Fed said the U.S. is facing "an unprecedented crisis" in which "loss in confidence in and between financial institutions can occur with lightning speed and devastating effects." The Fed supplied copies of three e-mails in response to a request that it disclose the identities of those supplying data on collateral as well as their contracts. The Bloomberg lawsuit said the collateral lists "are central to understanding and assessing the government’s response to the most cataclysmic financial crisis in America since the Great Depression." In response, the Fed argued that the trade-secret exemption could be expanded to include potential harm to any of the central bank’s customers, said Bruce Johnson, a lawyer at Davis Wright Tremaine LLP in Seattle. That expansion is not contained in the freedom-of-information law, Johnson said.

As we all are aware, Congress wanted to guarantee that the financial bailout would limit the compensation of Wall Street executives, so a mechanism for reviewing executive compensation and penalizing firms that break the rules was included. But at the last minute, the Bush administration insisted on a one-sentence change to the provision. The change stipulated that the penalty would apply only to firms that received bailout funds by selling troubled assets to the government in an auction, which was the way the Treasury Department had said it planned to use the money. Now, however, the small change looks more like a giant loophole. In a reversal, the Bush administration has not used auctions for any of the funds committed so far from the rescue package, nor does it plan to use them in the future. Lawmakers and legal experts say the change has effectively repealed the only enforcement mechanism in the law dealing with lavish pay for top executives.

Are we once again going to depend on the financial industry to ‘regulate’ themselves? Do they truly believe that by now calling a ‘bonus’ payment a ‘retention’ payment going to fool the public? Were we not told there would be transparency in detailing where our tax-payer money is going? Will our democratic representatives who claim to be the ‘middle class party’ now get a backbone and stop this ‘business as usual’?

This is our money – are you outraged?