Fight disinformation: Sign up for the free Mother Jones Daily newsletter and follow the news that matters.


THE TREASURY PLAN….The Washington Post has a brief tick-tock today explaining why Tim Geithner’s bank rescue plan, announced last week, was so anemic and lacking in detail.  And I have to say that it didn’t leave me brimming with confidence in my economic betters.  The basic problem, they say, was that at the last minute the Obama economic team decided that their plans were unworkable:

Senior economic officials had several approaches in mind, according to officials involved in the discussions. One would be to create an “aggregator bank,” or bad bank, that would take government capital and use it to buy up the risky assets on banks’ books. Another approach would be to offer banks a government guarantee against extreme losses on their assets, an approach already used to bolster Bank of America.

As the first week of February progressed, however, the problems with both approaches were becoming clearer to Geithner, said people involved in the talks. For one thing, the government would likely have to put trillions of dollars in taxpayer money at risk, a sum so huge it would anger members of Congress. Officials were also concerned that the program would be criticized as a pure giveaway to bank shareholders. And, finally, there continued to be the problem that had bedeviled the Bush administration’s efforts to tackle toxic assets: There was little reason to believe government officials would be able to price these assets in a way that gave taxpayers a good deal.

Say what?  After nearly two years of crisis and weeks of work, they suddenly discovered that buying up toxic assets from banks was problematic because the assets were expensive, hard to value, and risky for taxpayers?  That’s not exactly rocket science.  Hell, someone who had only casually browsed through the blogosphere over the past year would know that.  And not even the financial blogosphere.  Just ordinary lay blogs like this one.

I really don’t know what to think of this.  Maybe the Post has it wrong.  (Though their account matches others I’ve read.)  Maybe the problems were actually more subtle than the Post lets on.  But it sure sounds as if the Treasury team spent months discovering little more than that the world is round.  WTF?

FOLLOW THE MONEY

Corporations and billionaires don’t fund journalism like ours that exists to shake things up. Instead, support from readers allows Mother Jones to call it like it is without fear, favor, or false equivalence.

And right now, a longtime friend of Mother Jones has pledged an incredibly generous gift to inspire—and double—giving from online readers. That's huge! Because you can see that our fall fundraising drive is well behind the $325,000 we need to raise. So if you agree that in-depth, fiercely independent journalism matters right now, please support our work and help us raise the money it takes to keep Mother Jones charging hard. Your gift, and all online donations up to $94,000 total, will be matched and go twice as far—but only until the November 9 deadline.

$400,000 to go: Please help us pick up the pace!

payment methods

FOLLOW THE MONEY

Corporations and billionaires don’t fund journalism like ours that exists to shake things up. Instead, support from readers allows Mother Jones to call it like it is without fear, favor, or false equivalence.

And right now, a longtime friend of Mother Jones has pledged an incredibly generous gift to inspire—and double—giving from online readers. That's huge! Because you can see that our fall fundraising drive is well behind the $325,000 we need to raise. So if you agree that in-depth, fiercely independent journalism matters right now, please support our work and help us raise the money it takes to keep Mother Jones charging hard. Your gift, and all online donations up $94,000 total, will be matched and go twice as far—but only until the November 9 deadline.

$400,000 to go: Please help us pick up the pace!

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate