As I've pointed out many times over the past five years, the U.S. government has made more than $14 trillion available to Wall Street since the market meltdown of 2008. The money, which is funneled through the Federal Reserve and the Treasury Department, is part of a larger bailout package that has morphed into a a very generous market support program that currently backstops Wall Street's derivative-laced market bets.
Yeah, these are the same type of bets that crashed the economy in 2008.
When we combine the more than $14 trillion that's been made available to Wall Street with favorable legislation, general market subsidies, artificially low interest rates and assorted regulatory gifts for market players we have an outline of America's corporate welfare state. If I were going to offer a class on the topic I would call it Corporate Welfare 101.
I bring this up because I ran across this graph from the 2011 Washington Summit sponsored by Reuters.
In case you missed it, the more than $14 trillion that we have made available to Wall Street could pay Social Security benefits for the next 21 years. If we used the $14 trillion just to pay out benefits for children and disabled seniors with limited resources the program would be funded for the next 310 years. Similarly, if we applied the money to the Pell Grant program for financially strapped college students the program would be funded for the next 433 years.
Instead of doing any of this we're effectively underwriting Wall Street's reckless market bets. So, yeah, the on-going trillion dollar bailout isn't just Corporate Welfare 101, it's also a massive transfer of wealth to America's richest class.
Here's my question. Why is it that we have enough money to back stop Wall Street's gambles in the market - which encourages reckless behavior and subsidizes undeserved bonuses - but we're told that we don't have enough money for our nation's seniors, college students, or other national investment programs?
- Mark
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