The politics of Matt Tabbi’s big con
Aside from racism, the most important source of political power for the far right in the United States is apathy and despair. The same political forces that murdered people for registering to vote in Mississippi just a few decades back and that are still desperately working on voter suppression tactics today also work hard to convince “the wrong kind of voters” that there is no purpose in voting, it’s all a fraud, voting doesn’t change anything - only suckers turn out to vote, both parties are the same crooks. That’s the message that people like Matt Taibbi, knowingly or not, sell to the public often with grossly deceptive arguments. In his latest article, Taibbi makes the argument that the Democrats followed the same “financial bailout” policies as Republicans of rewarding the connected Wall Street banks and neglecting Main Street. Since the facts don’t support this argument, he displays an awesome set of rhetorical tricks. Consider how he misrepresents the Democrats Small Business Lending Fund:
Moreover, instead of using the bailout money as promised – to jump-start the economy – Wall Street used the funds to make the economy more dangerous. […]
Other banks found more creative uses for bailout money. In October 2010, Obama signed a new bailout bill creating a program called the Small Business Lending Fund, in which firms with fewer than $10 billion in assets could apply to share in a pool of $4 billion in public money. As it turned out, however, about a third of the 332 companies that took part in the program used at least some of the money to repay their original TARP loans. Small banks that still owed TARP money essentially took out cheaper loans from the government to repay their more expensive TARP loans – a move that conveniently exempted them from the limits on executive bonuses mandated by the bailout.
And a substantial majority of SBLF participants — more than 60 percent— have now increased their small business lending by 10 percent or more. In dollars, community bank participants increased their small business lending by $3.4 billion and CDLFs increased their small business lending by $86.8 million. [Treasury]
Using small-business funds to pay down their own debts, parking huge amounts of cash at the Fed in the midst of a stalled economy – it’s all just evidence of what most Americans know instinctively: that the bailouts didn’t result in much new business lending.