I received a letter yesterday in response to our new "Real Housewives of Wall Street" article that I thought was worth responding to publicly. I got a number of strange letters yesterday in fact (though most were funny -- one just read "guillotine time muthafuckaz!" in the subject line and nothing else), with a number of comments that suggested some elements in the story were unclear.
One tried to make the point that it is not, in fact, taxpayers who will be on the hook for future losses of securities bought with bailout programs -- that since the Fed bought these securities, the losses will be eaten not by the taxpayer but by the Federal Reserve. "You lose all credibility when you say taxpayers are on the hook for this," was how one emailer put it.
I should have made this clearer, but in the case of TALF [Term Asset-Backed Securities Loan Facility] loans like the ones made to Christy Mack's Waterfall company, a certain percentage of all of the losses are actually absorbed by TARP, a Treasury program. So the taxpayer is, in fact, at risk with these transactions. This is why TALF is subject to the purview of SIGTARP, the Special Inspector General for the TARP program.
Anyway, here is another letter I got yesterday:
Matt, excellent reporting. Most of your points are relevant and illuminating. Many of us who work in finance know about these programs and bringing this to light is a good thing. However, I have a problem with your conclusion.
You acknowledge that this was an Obama plan. You must also know that many of the recipients were Obama supporters yet after hooking the reader with the stories of financial atrocity, you turn and imply the Republicans are to blame in your closing paragraphs.
Have you heard of the Tea Party? Who else out there is calling for an audit of the Fed? Yes, Republicans are against nationalized Obamacare for the same reasons we're against all the shit you're reporting in your article; its corrupt, misleading and will lead to the type of abuses that stem from the same cronyism you seem to disagree with. The issue of illegal immigration is so vast and wide that to simply equate denying illegals an education with TALF is a cheap shot, easily recognized as such and well beneath the standards of reasoned journalism.
Your point should be that Republicans AND democrats should be against the financial contortion you describe. If journalists did their job and informed the people of the facts and resisted their instinct to taint their stories with bias maybe your story would have some lasting meaning. Instead the people equate YOU with the problem because your bias is so obvious, transparent and confused.
Stop serving your masters in the liberal wing, forget about topping each other with hate of republicans and do what you are supposed to do and report. If your wondering why mainstream media is ignored, look no further than your biased conclusion. People get it so much more than you appear to realize.
I want to make three points in response to this letter, since I've been getting a lot of emails along these general lines lately:
1) TALF was not an Obama program. It was instituted when George Bush was still president. Granted, its architects included people like Tim Geithner, but in general the bailouts were an absolutely bipartisan phenomenon, and the broad outlines for most of them were drawn during Bush's presidency. They were merely continued with gusto under Obama.
2) The point about the Republicans was not that they were responsible for these loans, but that their rhetoric about spending is so preposterously dishonest. The entire narrative of the Tea Party paints a picture of government as a monstrous machine for redistributing wealth from the middle class to the undeserving poor. It is almost completely silent when it comes to stories like this TALF business, which are about redistributing money to the undeserving rich. If these loans had been given to ACORN or to minority homeowners, you can bet this story would be circulating on every conservative news station this morning. But since the recipients are rich white people from Manhattan, the Tea Party is simply not all that interested/outraged.
My own personal view on this is not so much that Tea Partiers are racists, but more that they're tremendous pussies. They have no problem puffing out their chests and screaming bloody murder about Mexicans or single black Moms taking their tax money for emergency room care or school lunches. But when John and Christy Mack rob them to buy mansions on the Upper East side, you suddenly can't find a Tea Partier within a thousand miles -- can't find one with the Hubble space telescope. For all their bluster and aggressiveness, billionaires make them go weak in the knees. Which makes it very hard to take them seriously.
3) If you make the "your" mistake, you automatically lose any argument. Right? Reader input welcomed on this.
Anyway, I have some more questions about this story that I'll be answering in the next days. I'm also going to be on the Imus show tomorrow morning at 8:30 to talk about this, and I'll be visiting old friend Dylan Ratigan at 4 p.m. Friday.