The Washington Post

Romney favored TARP? And Bush signed it?

There’s nothing like the left-wing blogosphere to tip you off to the latest line of attack against the presumptive nominee Mitt Romney. Take this headline: “Romney Embraces Bush Economic Policies.” In fact, all that Romney did was point out something that a great many Democrats have been pointing out: The Troubled Asset Relief Program likely prevented a total financial meltdown in the fall of 2008.

Oh, Romney points out, that would be George W Bush and not Barack Obama, who was busy avoiding taking a position during the campaign, who came up with the legislation and fought to get it through Congress. Here’s the comment: “I keep hearing the president say he’s responsible for keeping the country out of a Great Depression. No, no, no, that was President George W. Bush and [then-Treasury Secretary] Hank Paulson.”

Ironically, this is a position Romney held onto during the primary (pro-TARP) and for which his opponents pummeled him. Moreover, he is stating something liberals — and a great number of conservatives including Rep. Paul Ryan (R-Wis.) at the time — believed to be true, namely that a massive shot of liquidity was needed to keep the banking industry from a meltdown. (Conservatives argue that when government messes up the economy — with a flawed housing policy and Fed dereliction, for example — the short-term solution, unfortunately, is usually more government.)

Romney’s position was not unlike the Wall Street editorial board’s, which wrote on Oct. 27, 2009:

The Troubled Asset Relief Program will expire on December 31, unless Treasury Secretary Timothy Geithner exercises his authority to extend it to next October. We hope he doesn’t. Historians will debate TARP’s role in ending the financial panic of 2008, but today there is little evidence that the government needs or can prudently manage what has evolved into a $700 billion all-purpose political bailout fund.

We supported TARP to deal with toxic bank assets and resolve failing banks as a resolution agency of the kind that worked with savings and loans in the 1980s. Some taxpayer money was needed beyond what the FDIC’s shrinking insurance fund had available. But TARP quickly became a Treasury tool to save failing institutions without imposing discipline (Citigroup) and even to force public capital onto banks that didn’t need it. This stigmatized all banks as taxpayer supplicants and is now evolving into an excuse for the Federal Reserve to micromanage compensation.

TARP was then redirected well beyond the financial system into $80 billion in “investments” for auto companies. These may never be repaid but served as a lever to abuse creditors and favor auto unions. TARP also bought preferred stock in struggling insurers Lincoln and Hartford, though insurance companies are not subject to bank runs and pose no “systemic risk.” They erode slowly as customers stop renewing policies.

TARP also became another fund for Congress to pay off the already heavily subsidized housing industry by financing home mortgage modifications

So what is the point here? Liberals are mad that Romney reminded the voters that TARP was Bush’s doing? They’re peeved that he stuck with an unpopular position in the primary (oh my, how counter-narrative!)?

There is going to be much about the presidential race coverage that with be perplexing. When the media — both conservative and mainstream — are in nonstop attack-mode (liberal boosterism for the president merges with conservative resentment that Romney prevailed) you’ll get plenty of gotcha moments that don’t make a lot of sense. In past elections the conservative media have served as necessary counterweights to check the excesses and biases of the mainstream media and report what the MSM failed to, as conservative journalists did in 2008.

But this election, I suspect, will be different. Pack journalism, made infinitely worse by Twitter, sweeps up conservatives and liberals alike. The conservative blogosphere that was largely and loudly critical of Romney has something to “prove” by painting him as a rotten candidate. And those who pined for a conservative white knight will never be content with a mortal candidate. The default interpretation I predict of any incident will be whatever take is the most unfavorable toward Romney.

I don’t suggest that he should complain about it. I’ve said many times that conservative candidates do themselves no favors by complaining about negative coverage. But that doesn’t mean that voters, readers, viewers and other journalists shouldn’t continue to bird-dog the media biases and complete the missing pieces of the campaign portrait.

So prepare for some of the most biased and aggressively anti-GOP presidential coverage you’ve ever seen. It doesn’t doom Romney, but it pose a challenge for his campaign.

Jennifer Rubin writes the Right Turn blog for The Post, offering reported opinion from a conservative perspective.


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