Federal Takeover

If it has indeed declined to accept $340 million in payments from banks in Louisiana, New York, Indiana and California, the administration is tacitly admitting that it wants to control those banks as well as others that will try to pay back the taxpayers' money they took in the Troubled Asset Relief Program.

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By refusing repayment, the government can keep the leverage it bought with the bailouts. Banks that still "owe" would not be in position to reject the administration as a "partner." This reminds us of mobsters making a small "investment" in a family-owned shop, which is not always wanted by the owners, and then using it to justify taking over the business. More...

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