Bailout: An Inside Account of How Washington Abandoned Main Street While Rescuing Wall Street

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Bailout: An Inside Account of How Washington Abandoned Main Street While Rescuing Wall Street

3.85 of 5 stars 3.85 · rating details · 505 ratings · 118 reviews

In telling of his stranger-than-fiction baptism into the corrupted ways of Washington, Barofsky offers an irrefutable indictment, from an insider of the Bush & Obama administrations, of the mishandling of the $700 billion TARP bailout fund. In behind-the-scenes detail, he shows the extreme degree to which government officials bent over backward to serve the interests o...more In telling of his stranger-than-fiction baptism into the corrupted ways of Washington, Barofsky offers an irrefutable indictment, from an insider of the Bush & Obama administrations, of the mishandling of the $700 billion TARP bailout fund. In behind-the-scenes detail, he shows the extreme degree to which government officials bent over backward to serve the interests of Wall Street firms at the expense of the public—& at the expense of effective financial reform. During the height of the financial crisis in 2008, Barofsky gave up his job as a prosecutor in the US Attorney’s Office in NYC, where he'd convicted drug kingpins, Wall Street executives & mortgage fraud perpetrators, to become the special inspector general in charge of oversight of bailout money spending. From the first his efforts to protect against fraud & to hold big banks accountable for how they spent taxpayer money were met with outright hostility from Treasury officials in charge of the bailouts.
Barofsky discloses how, in serving banking interests, Treasury Secretary Timothy Geithner & his team worked with Wall Street executives to design programs to would funnel vast amounts of taxpayer money to their firms & would have allowed them to game the markets & make huge profits with almost no risk or accountability, while repeatedly fighting efforts to put the necessary fraud protections in place. His investigations also uncovered abject mismanagement of the bailout of insurance giant AIG & Geithner’s decision to allow the payment of millions of dollars in bonuses & that the Obama administration’s TARP Czar lobbied for the executives to retain their high pay.
Providing details about how, meanwhile, the interests of homeowners & the broader public were betrayed, Barofsky recounts how Geithner & his team steadfastly failed to fix glaring flaws in the Obama administration’s homeowner relief program pointed out by bailout watchdogs, rejecting anti-fraud measures, which unleashed a wave of abuses by mortgage providers against homeowners, even causing some who wouldn't have lost their homes otherwise to go into foreclosure. Ultimately only a small fraction ($1.4 billion when he stepped down) of the $50 billion allocated to help homeowners was spent, while the funds expended to prop up the financial system totaled $4.7 trillion. As he raised the alarm about the bailout failures, he met with obstruction. He recounts in blow-by-blow detail how an increasingly aggressive war was waged against his efforts, with even the White House launching a broadside against him. Bailout is a riveting account of his plunge into the political meat grinder of Washington, as well as a vital revelation of just how captured by Wall Street the political system is & why the too-big-to-fail banks have only become bigger & more dangerous in the wake of the crisis.(less)

Hardcover, 288 pages

Published July 24th 2012 by Free Press/Simon & Schuster, Inc. (NYC)

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May 16, 2013 Al rated it 4 of 5 stars

Mr. Barofsky, a young prosecutor in the New York U. S. Attorney's office, was drafted to be the Treasury's Inspector General of the TARP funds. His book details his idealistic approach to his work, his initial naivete about the ways of Washington and the motivations of many of its denizens, and his efforts to cut through the misinformation, foolishness, and outright lies of the agency he monitored. Clearly, he brought to the table an intelligence, toughness, and sense of responsibility that few...more Mr. Barofsky, a young prosecutor in the New York U. S. Attorney's office, was drafted to be the Treasury's Inspector General of the TARP funds. His book details his idealistic approach to his work, his initial naivete about the ways of Washington and the motivations of many of its denizens, and his efforts to cut through the misinformation, foolishness, and outright lies of the agency he monitored. Clearly, he brought to the table an intelligence, toughness, and sense of responsibility that few others would have, and many of his accomplishments helped shed light on some very poor decisions and practices at Treasury. His disrespect of senior Treasury officials, including most specifically Secretary Geithner, is deep and well-justified.
Still, there is nothing in the narrative about how and why Geithner made his decisions, and what pressure he was under from Obama, Summers and others. Therefore, Barofsky's story begs the question of who was really calling the shots which he is rightly decrying. Other books have explored this question, and it seems pretty clear that Geithner was way over his head in his job, and if one connects the dots, most of responsibility for the failures of TARP and the whole bailout process which Barofsky catalogues probably can be laid at the feet of the President and his advisors. No assessment of Geithner which I've seen leads me to believe he was doing -- or was capable of doing -- much but trying to stay afloat. Small wonder that Barofsky, a straight shooter, was so upset by what he saw, but a shame that he wasn't in a position to see the whole picture.
I don't agree with all Barofsky's positions (for example, he's not persuasive in dismissing moral hazard as a serious issue when thinking about whether to modify mortgages for underwater borrowers), but for the most part he's on the money. The story he tells is interesting, well-written and extremely damaging to the Obama administration in general and the Treasury Department in particular.
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May 02, 2013 Drew Mochak rated it 5 of 5 stars

A must-read for any American. The obvious temptation here is to bog the narative down with rambling, unproovable he-said, she-said accounts of meetings wherein person X said to person Y a seemingly harmless phrase that, once you read another five books on the unspoken code of Washington politics, actually means something sinister unless it doesn't or he made it all up. Another common trope of "insider" wallstreet books is to obscure the issue with constant parades of data, figures, graphs and mu...more A must-read for any American. The obvious temptation here is to bog the narative down with rambling, unproovable he-said, she-said accounts of meetings wherein person X said to person Y a seemingly harmless phrase that, once you read another five books on the unspoken code of Washington politics, actually means something sinister unless it doesn't or he made it all up. Another common trope of "insider" wallstreet books is to obscure the issue with constant parades of data, figures, graphs and musings that can only be understood by someone who already knows what's being said, and is merely seeking self-affirmation. Instead, what's offered here is a frank, concise accounting of the facts, which are that the treasury department runs interferance for the banks, and in turn, the white house runs interferance for the Treasury department. Congress runs interferance for congress, and no one gives a shit about us. There are accounts of meetings and more off the record discussions with government officials but apart from the introduction they are brief, and only serve to underscore the central point of each chapter. Some of my favorite parts are what appear to be throw-away lines near the beginning, such as when the author received preparation advice on his confirmation hearing from Team Bush: "If you're asked a multipart question, just answer the part you want to answer and ignore all of the other ones. Most of the Senators don't really care about your answer and are just looking to get their question on the evening news. If someone pushes you, say you are not yet privvy to that information and promise to make it a top priority if confirmed." It's like how we imagine a generic evil power-hungry villain would act in a story accept it's all real and they run our government. Crazy. Anyways! This novel, unlike this review, covers the important events of the Wallstreet bailouts in a highly focused way, providing a nonpartisan account of both the Bush and Obama whitehouses and the differences between them--or, rather, lack thereof. The narative voice is rather frank, makeing an otherwise dry read very open and accessible to the average wage slave.(less)

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Apr 29, 2013 Jack rated it 3 of 5 stars

A worthwhile read, but people who have read the journalistic accounts of the bailout won't discover much that's new here. The book's essential point, as the subtitle implies, it that Washington made rescuing Wall Street a top priority while never moving past show pieces in terms of protecting the middle class. Barofsky scores some effective hits in reinforcing that point, particularly the manner in which the Treasury department never put much effort into mortgage modification or relief even as i...more A worthwhile read, but people who have read the journalistic accounts of the bailout won't discover much that's new here. The book's essential point, as the subtitle implies, it that Washington made rescuing Wall Street a top priority while never moving past show pieces in terms of protecting the middle class. Barofsky scores some effective hits in reinforcing that point, particularly the manner in which the Treasury department never put much effort into mortgage modification or relief even as it panicked about how Wall Street might react to even the mildest restrictions or regulation of its activities.

But, even though Barnosky writes this as a distinctly "inside baseball" narrative of his time as Special Inspector General of Tarp, he does not say much that one could not have found in Gretchen Morgenson's columns for the New York Times. And while it is indeed disturbing that the Treasury and the heads of TARP under both Bush and Obama ignored repeated warnings coming from the office in charge of monitoring its handling of the bailout, the lack of strings or meaningful commitment to reform is, by now, sadly well documented. The big contribution of this book was Treasury and TARP's resistance even to the office in charge of policing their behavior, but really, how much does that change the narrative when the issues were so obvious even before the bailout passed? (Sidenote: Barofsky documents outright, criminally prosecutable fraud within TARP programs, as well as violations of the spirit of the bailourt if not the law. But most of his criticisms are that TARP actually worsened the problem of "too big to fail" and was generally poorly structured in terms of "fixing the economy." I am sincerely unclear on whether his job included policing the program in that sense. I certainly think SOMEONE should have been in charge of that, and I am not defending the of the bailout. But Barofsky's insider account of how he and his concerns were ignored is somewhat different if his most systemic criticisms fell outside the purview of a position that was supposed to focus on fraud and the implementation of policy, rather than shaping the policy aims itself.)

This book, like many on the bailout, also emphasizes the need for more studies of intellectual and regulatory capture. Barofsky sometimes writes as though he and his staffers, Elizabeth Warren, and a few members of congress were the only people interested in curbing the excesses of Wall Street and the worst policies of the bailout against a torrent of bad regulators and officials, which is a disturbing image. But it also raises the issue of how we got to this point. Geithner, for example, comes across as tempremental, dismissive, and arrogant in his determination that his job was to protect high finance, even viewing mortgage modifications as just a way to slow down costly foreclosures for the good of the banks. But Geithner, whatever his personal flaws, also seems indicative of a broader problem. He is not some former Goldmanite shill looking to protect his future career opportunities. He is a career technocrat who had no real reason to so consistently defer to the demands of the investment houses except that, for some reason, he was a true believer that they merited the deference he gave them on the bailout and that what he was doing was in the economy's best interests. That problem seems to have pervaded much of the bailout, and it begs the question of how we can cultivate public officials who, almost inevitably, have to live embedded in the modern financial sector in order to understand it, but who do not drink the kool-aid and begin to embraced the ethos of the people they are supposed to be regulating?

Again, it was a worthwhile read. But it appears, first and foremost, to demonstrate that the priorities of the bailout were unethically warped, which most people interested in reading the book in the first place probably already knew. The big question is, what do we do about it now?

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Apr 11, 2013 Peggy Pisciotta rated it 4 of 5 stars

Barofsky was hired as Special Inspector General to oversee TARP, the bank bailout, after prosecuting mortgage fraud in the US Attorney's office in the Southern District of New York. He started full of idealism aboutt helping homeowners, prosecuting fraudsters, and protecting the US taxpayer. At every turn he was blocked by Treasury and the Fed. He'd try to install fraud protections, they'd say the big banks wouldn't risk their good name by fraudulent behavior. He'd try to institute audits to see...more

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Apr 09, 2013 Mehrsa rated it 4 of 5 stars

I think Neil Barofsky overdoes it quite a bit in this book--both his role and the black and white position of the treasury and the President. But he sees the financial crisis as a prosecutor. While that viewpoint may or may not be clarifying, what the book does provide in rich detail is why it is a must read. Because NB basically writes the book like a journal, it's a great look into how Washington politics work, especially the interplay between Treasury, congress, and the IG's office. He writes...more

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Mar 26, 2013 Schnaucl rated it 5 of 5 stars

Shelves: library, march, read_2013, recommended_reading, non-fiction

If you're interested in the bailout rather than how we got into this crisis in the first place you should definitely read this book.

I've been doing a lot of reading about the crisis and the aftermath, but there was still a lot that was new to me. I hadn't realized just how disorganized Treasury was or how involved the White House was in covering Treasury's ass at the expense of the taxpayers.

Apparently the real purpose of HAMP wasn't to help homeowners at all, but to slow down the defaults to...more

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Mar 18, 2013 Al rated it 4 of 5 stars

In this bracing, page-turning account of his stranger-than-fiction baptism into the corrupted ways of Washington, Neil Barofsky offers an irrefutable indictment, from an insider of the Bush and Obama administrations, of the mishandling of the $700 billion TARP bailout fund. In vivid behind-the-scenes detail, he reveals proof of the extreme degree to which our government officials bent over backward to serve the interests of Wall Street firms at the expense of the broader public—and at the expen

...more

During the height of the financial crisis in 2008, Barofsky gave up his job as a prosecutor in the esteemed U.S. Attorney’s Office in New York City, where he had convicted drug kingpins, Wall Street executives, and perpetrators of mortgage fraud, to become the special inspector general in charge of oversight of the spending of the bailout money. From his first day on the job, his efforts to protect against fraud and to hold the big banks accountable for how they spent taxpayer money were met with outright hostility from the Treasury officials in charge of the bailouts.

Barofsky discloses how, in serving the interests of the banks, Treasury Secretary Timothy Geithner and his team worked with Wall Street executives to design programs that would funnel vast amounts of taxpayer money to their firms and would have allowed them to game the markets and make huge profits with almost no risk and no accountability, while repeatedly fighting Barofsky’s efforts to put the necessary fraud protections in place. His investigations also uncovered abject mismanagement of the bailout of insurance giant AIG and Geithner’s decision to allow the payment of millions of dollars in bonuses—including $7,700 to a kitchen worker and $7,000 to a mail room assistant—and that the Obama administration’s “TARP czar” lobbied for the executives to retain their high pay.

Providing stark details about how, meanwhile, the interests of homeowners and the broader public were betrayed, Barofsky recounts how Geithner and his team steadfastly failed to fix glaring flaws in the Obama administration’s homeowner relief program pointed out by Barofsky and other bailout watchdogs, rejecting anti-fraud measures, which unleashed a wave of abuses by mortgage providers against homeowners, even causing some who would not have lost their homes otherwise to go into foreclosure. Ultimately only a small fraction (just $1.4 billion at the time he stepped down) of the $50 billion allocated to help homeowners was spent, while the funds expended to prop up the financial system—as Barofsky discloses—totaled $4.7 trillion. As Barofsky raised the alarm about the bailout failures, he met with obstruction of his investigations, and he recounts in blow-by-blow detail how an increasingly aggressive war was waged against his efforts, with even the White House launching a broadside against him. Bailout is a riveting account of his plunge into the political meat grinder of Washington, as well as a vital revelation of just how captured by Wall Street our political system is and why the too-big-to-fail banks have only become bigger and more dangerous in the wake of the crisis.

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Mar 11, 2013 Athan Tolis rated it 5 of 5 stars

As much fun as you can possibly have finding out about the inner workings of government.

Not much, then, but still an awesome account. This is a book about two friends who took on the Washington establishment and lost. But they won enough battles along the way to make this a fun read.

Neil Barofsky had a very strong background to become the inspector general of TARP. However, he took a bit too long to realise TARP was but a thinly veiled vehicle to shore up the capital of America's biggest banks a...more As much fun as you can possibly have finding out about the inner workings of government.

Not much, then, but still an awesome account. This is a book about two friends who took on the Washington establishment and lost. But they won enough battles along the way to make this a fun read.

Neil Barofsky had a very strong background to become the inspector general of TARP. However, he took a bit too long to realise TARP was but a thinly veiled vehicle to shore up the capital of America's biggest banks and their trading counterparties. Thankfully, this made him even more determined to act.

So him and his deputy spent a long time fighting the good fight and gave their best. There's good guys in the book and there's villains. But the author recognizes that everybody has a role and most were acting in a manner consistent with their principles. He bemoans the manner in which Neil Kashkari stonewalled him, for instance, but fully recognizes that they simply came to the problem from a different angle.

An exception is made for Tim Geithner, who is not profiled in a terribly flattering way, but that is starting to be rather consistent in the literature that surrounds the bailouts. That said, the author (a Democrat) leaves the door open to the notion that Geithner may have been doing the dirtywork for the White House. We'll never know.

My beliefs are not aligned with the author's. I have sympathy for the Neil Kashkari argument that "all money is green" which seems to give Neil Barofsky the hives and I most certainly don't share in the author's pity for all the guys who took out a mortgage they could not afford on a house they could not afford. On the other hand, of course, I totally agree that the whole idea behind TARP and the deference given to the banks was an abomination. And the author's account leaves zero doubt in my mind that the public was horribly misled by HAMP and the rest of the programs. Finally, as a citizen I've found from the horse's mouth that (contrary to the stories I've read in the paper) TARP did not make the advertized returns.

But that is not the point at all. I thoroughly enjoyed the book because it is a deep, insightful and fascinating account of how Washington works. To get an account like that you need a guy who's been there, who's managed to get out and who has the gift of writing well.

Neil Barofsky scores on all those fronts. He lays out the history, he presents the characters and keeps developing them during the story, he has a good laugh and managed to force plenty out of me too. He took the job seriously, did it as well as he could and thankfully he got a chance to tell us about it.

I've read a good five books on the bailout, from Stiglitz to Sorkin and this is the one I'd recommend to my dad if he asked.
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Mar 11, 2013 Erik Simon rated it 3 of 5 stars

Yet another voice screaming that the banks need to be broken up before another global financial meltdown, but this isn't just any voice: it's the Inspector General of TARP. (For those who didn't see, last week, Senator David "Family Values" Vitter even climbed off of his whores long enough to say, "Break up the banks.") Also . . .

I didn't know that TARP was originally passed to help homeowners with their mortgages. Paulson tried to pass it for money for the banks, but Congress refused. That sai...more

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Nov 16, 2012 John rated it 3 of 5 stars

Other reviewers have given sufficient details about the content of this book. Barofsky learned that even his position as a Special Inspector General, one intended to be an independent voice, watchdog, and adviser to those rolling out massive bailout programs, could not in many cases change the course of events by implementing needed safeguards into these programs. Treasury Secretary Tim Geithner in particular seemed to be determined to do things the way he saw fit, regardless of the counsel Baro...more

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Nov 13, 2012 Frank Stein rated it 5 of 5 stars

One of the best descriptions of Washington I have ever read.

To start off I have to say that, despite the title, the least interesting parts of the book are actually those in which Neil Barofsky, the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), describes the intricacies of how the Treasury, under both Bush and Obama, shoveled more money to undeserving firms, granted banks unnecessary tax privileges, and exacerbated the foreclosure crisis with poorly designed programs...more
One of the best descriptions of Washington I have ever read.

To start off I have to say that, despite the title, the least interesting parts of the book are actually those in which Neil Barofsky, the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), describes the intricacies of how the Treasury, under both Bush and Obama, shoveled more money to undeserving firms, granted banks unnecessary tax privileges, and exacerbated the foreclosure crisis with poorly designed programs like HAMP. Thanks at least partially to Barofsky's work as SIGTARP, from whence he provided oversight for the $700 billion dollar bank bailout, those stories have been told many times before.

What is truly original here is Barofsky's insightful and refreshingly honest look at Washington machinations. This is not a tale of grand corruption, of unmarked bags of cash and under-the-table briefcases that Oliver Stone or some other director would have us imagine. This is instead a story of how pettiness and childish ceremonies of power and privilege corrupt the personalities of those who work in a constantly political world. Unlike most strivers in DC, though, Barofsky seems remarkably immune from "Potomac Fever," and thus keeps a sharp eye for the ridiculous protocols that define a place that remains foreign but fascinating to him. He and his deputy, who both came to DC from "the Office," the US Attorney's Office of the Southern District of New York, are always rushing to each other to explain the newest hilarious strategy by Paulson or Geithner to undermine whomever they've decided to oppose for the moment.

For instance, at one point a Treasury employee stops Barofsky in the hall to claim that Elizabeth Warren "really hates him," and is really jealous of him, something he knows is not true since he just talked to her, but that someone in Treasury clearly thought it was worthwhile tto mention in order to drive a wedge between the two of them. Such high-school rumor mongering in fact seems ubiquitous here, and is nearly always traced to someone at the top carrying out some scheme. Another kind of sabotage was even less subtle. After assigning SIGTARP the worst office in the Treasury building, one that reeks of eggs and fish, a classic Washington put-down, Secretary Paulson goes farther by making it almost impossible for SIGTARP to acquire garbage cans. Instead they have to collect their own garbage and pile it up on cafeteria trays. Of course government regulations prohibited them from acquiring any cans for months without putting out bids, UNLESS they acquired them from other government agencies, who therefore knew to descend on his office like door-to-door salesmen to sell him everything from over-priced printer toner to cheap chairs. He and the reader had to wonder, where did they get all this stuff to sell?

Through the madness, though, Barofsky keeps his perspective. The one point where you think he may have lost it, when he starts fuming over the fact that an "acting" agency head gets to speak before him at a congressional hearing, against the established-speaking hierarchy, his wife points out to him that he is finally beginning to absorb the Washington atmosphere, and it is then he decides that he has to resign. The reader has to be relieved.

There's lots of other great little Washington tidbits here. How he gets given $50 million dollars to set up an office but can't hire anyone for months because of government regulations, or how the mis-titled Paperwork Reduction act causes a scuffle between him and the White House that forces him to go through Congress and the press to get a typical waiver. So if you want to know why Washington is different from almost every other place in the country, this is the book to go to.(less)

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Oct 14, 2012 Harry Lane rated it 5 of 5 stars

Barofsky begins by establishing his bona fides, which are considerable. Before becoming the Special Inspector General for the Troubled Asset Relief Program, he worked as a prosecutor for the Southern District of New York. Among other accomplishments during his career there, he headed the Mortgage Fraud Group and successfully prosecuted a number of cases.

The structure of his narrative is essentially chronological, but along the way Barofsky points to a number of factors contributing to the financ...more
Barofsky begins by establishing his bona fides, which are considerable. Before becoming the Special Inspector General for the Troubled Asset Relief Program, he worked as a prosecutor for the Southern District of New York. Among other accomplishments during his career there, he headed the Mortgage Fraud Group and successfully prosecuted a number of cases.

The structure of his narrative is essentially chronological, but along the way Barofsky points to a number of factors contributing to the financial meltdown. Among the most important are perverse incentives and lack of regulation. For example, much of the housing bubble resulted from the securitization of mortgages, such that the more mortgages a bank could originate and sell, the higher their profit. The incentive to do so thus became more important than the incentive to insure the borrower was a good credit risk. Similarly, credit rating agencies, whose ratings assured investors these instruments were relatively risk free were paid for their services by the very people selling those instruments. They therefore had a strong financial incentive to rate them highly. It seems clear also that those agencies which had some level of oversight authority, such and the Federal Reserve, the Federal Deposit Insurance Corporation, Fannie May and Freddie Mac, and the Treasury Department, failed to see the problem developing or to use the tools available to them to mitigate it. And, to be sure, some elements of the problem would have been difficult to address within the existing regulatory framework.

Barofsky's account of his attempts to get Treasury to build in appropriate controls and safeguards is depressing. He makes abundantly clear that the powers that were (and are even to this day) were totally focused on managing the crisis to keep the captains of finance from suffering any undue discomfort. He makes two telling propostitions. One, TARP and the actions of others involved in the bailout hugely benefited Wall Street, But did nothing for main street or homeowners. Two, even though the result saved the economy from going over a cliff, the failure to address the systemic problems simply means, as Barofsky put it, we are still driving on the same winding mountain road, but this time in a faster car with faulty brakes.

An overarching lesson from this story, it seems to me, is that people and institutions whose business depends on trust have shown themselves unworthy of that trust. That so many people have been willing to engage in deceptive practices, some of which cross the border into outright fraud, is disturbing. Yet they seem to believe that they should be trusted to go on their merry way without systemic correction or additional oversight. That is even more disturbing.(less)

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Sep 30, 2012 Rick rated it 4 of 5 stars

Unless he's highly manipulative, you can tell Barofsky is a good guy because he mentions his wife so much. This is my new theory about government/economics/politics books. If they talk a lot about their spouse, they're probably a decent person. This was a fascinating book, I had followed the TARP situation very closely at the time, and occasionally heard about SIGTARP and Barofsky, but it was all a bit fuzzy to me. This book gives you some good behind-the-scenes on the oversight of TARP, but unf...more

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Sep 21, 2012 William Thomas rated it 1 of 5 stars

Behold, Neil Barofsky is the Second Coming of Christ! Witness as he is led into the temple and overturns the money-changers' tables! Watch as he is nearly crucified in Columbia! Gaze at the pinnacle of moral superiority in a corrupt world!

Jesus H. Christ. This book is nothing more than an autobiography of Barofsky's life over the last 10 years or so. It is not, as billed, a history of, nor a socio-political analysis of, nor a thorough examination of the bailouts it claims to be. Instead, what we...more Behold, Neil Barofsky is the Second Coming of Christ! Witness as he is led into the temple and overturns the money-changers' tables! Watch as he is nearly crucified in Columbia! Gaze at the pinnacle of moral superiority in a corrupt world!

Jesus H. Christ. This book is nothing more than an autobiography of Barofsky's life over the last 10 years or so. It is not, as billed, a history of, nor a socio-political analysis of, nor a thorough examination of the bailouts it claims to be. Instead, what we get here is Barofsky trying to clear his name for posterity and so that history cannot label him a monster in the wake of this catastrophe. It's basically 300 pages of him trying to cover his ass and martyr himself while redirecting all blame to a myriad of other Capitol Hill players.

What irked me most about this book? The fact that Barofsky plays the doe-eyed babe-in-the-woods here, just a plain old guy getting ground to dust by the bureaucracy, and appalled by the immorality of those around him. If we are to believe Barofsky, he is the pinnacle of morality, not only in DC, but in NYC and any other place he sets foot. Wherever he goes, he walks on water. Not only that, but before becoming the GIC of Oversight for TARP, he only ever worked for people who were as moral as he and could teach him to be even more righteous.

Now, any man working as a lawyer in a major metropolitan area, or for the federal government, cannot be, by definition, a babe-in-the-woods. Not the lost and wandering naive man he claims to have been. The man openly admits to taking on the largest drug cartel in the world. Does this sound like a country bumpkin that doesn't know his way around a big city? Poor Neil, you were just a straw man, weren't you. Poor baby. But wait. That's not right. You were a shark when you were dropped into the oversight job. Don't try to play dumb with us.

The gall of this man just burns me up. On top of that, there isn't even enough actual information about the bailout in this book to fill a New Yorker article, let alone this book. Anything reported in these pages has been public knowledge for years now. It isn't anything you can't find out from CNN reports or the NYT. But, if you want to know more about the martyred Second Coming of Christ, the moral apex of the US and the end of a political career trying to be saved for posterity, well then go right ahead and read this, Neil Barofsky's autobiography. (less)

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Sep 08, 2012 Jerry rated it 3 of 5 stars

Shelves: politics, economics

This book confirms my worst suspicions about the Wall Street bailouts. From the bailouts with few strings attached, to the Wall Street executives' billions in bonuses, to the AIG bailout paying the banks 100 cents on the dollar for CDS contracts worth about half that, Treasury always helped the banks at the expense of everyone else. Treasury continually resisted and stonewalled the efforts of the Special Inspector General (SIG) to protect taxpayers and limit the potential for fraud in the progra...more This book confirms my worst suspicions about the Wall Street bailouts. From the bailouts with few strings attached, to the Wall Street executives' billions in bonuses, to the AIG bailout paying the banks 100 cents on the dollar for CDS contracts worth about half that, Treasury always helped the banks at the expense of everyone else. Treasury continually resisted and stonewalled the efforts of the Special Inspector General (SIG) to protect taxpayers and limit the potential for fraud in the programs.

Thirty-five bailout programs represented a total commitment of $23.7 trillion in taxpayer backing! The actual outlay maxed out at $4.7 trillion in total. By July 2009 the outlay was down to $3 trillion but by July 2010 back up to $3.7 trillion.

In the design of the Public-Private Investment Program (PPIP) to purchase up to $2 trillion of “legacy assets” including residential mortgage-backed securities, Treasury kept SIG out of the process while working with BlackRock, the Trust Company of the West Group (TCW), and PIMCO which were investment houses who stood to profit from PPIP. Treasury resisted attempts by SIG to require a “firewall” between the PPIP fund managers and other departments in the investment company to limit its use to manipulate the prices of assets the company has in its other portfolios.

In the Home Affordable Modification Plan (HAMP) which was supposed to help 2 to 3 million homeowners modify their mortgages, Treasury allowed the mortgage servicers, owned by the big banks (three of the largest were owned by Wells Fargo, Bank of America, and JPMorgan Chase), to take advantage of homeowners. Servicers make more profit from a foreclosure than from a modification. “They earn fees when borrowers are late on payments and charge for certain foreclosure-related services. Importantly for the servicers, when a home is sold in foreclosure, they are typically paid all their fees and advance expenses before the owners of the mortgagees get any of the proceeds of the sale... Though it may be better for an investor if a mortgage is modified, the servicer may be better off if a home goes to foreclosure.” A servicer may make the most if it drags out a trial modification for months then forecloses. It was a common practice for a servicer to “lose” the paperwork of a borrower's application as a pretense to foreclose. “A survey by ProPublica found that borrowers had to submit documents an average of six times – but the servicers would still claim that documents had never been received and then foreclose.” SIG discovered that contrary to the publicly stated objective of helping homeowners, Treasury's real objective for HAMP was to drag out the foreclosure process giving the banks more time to improve their financial position. “Treasury has not held any servicer responsible in even the slightest way for the widespread abuses of HAMP applicants, nor is it ever likely to do so.”

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Aug 30, 2012 Eric Murphy rated it 5 of 5 stars

A non-ideological look at how the bailout was a massive transfer of wealth from taxpayers to Wall Street banks (assisted by both administrations' Treasury Departments) that vindicates equally the Tea Party and Occupy Wall Street, written by the top official in charge of policing fraud in the bailout program. The conclusion says it all: "I now realize that the American people *should* lose faith in their government. They *should* deplore the captured politicians and regulators who took their taxp...more

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Jul 31, 2012 Manny rated it 4 of 5 stars

I will begin by saying that I was and still am against T.A.R.P.. With that being said, it was passed and we had it. Neil Barofsky is a Democrat and donated to the Obama campaign in 2008. He was nominated as Inspector General of T.A.R.P. by President Bush and was confirmed by both sides with barely any incident.

Barofsky nails it in this book. He starts by being critical of the Bush administration and then states that he is hopping that the new administration (Obama) and his appointments will be...more

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Jul 25, 2012 Joseph Geskey rated it 3 of 5 stars

1 star for the wooden prose and the incessant need to tattle on government officials who may have insulted the author during his role in Washington (Tim Geithner, Herb Allison, Eric Thorson, and many others) by describing instances of insults, profanity-laced conversations, and failure to be given the deference the author felt was his due mar the 5-star expose of how capitalism allows for the privatization of profits but the socialization of losses. The descriptions of the various programs our g...more

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Jan 31, 2013 Cathy0584 rated it 4 of 5 stars

Remember the Financial Crisis of 2008? Remember how they told us the entire global financial system could have melted down? Current affairs, government insiders, and more bad news about how your tax dollars are spent shoring up the wealthy of Wall Street and the mega-banks. Barofsky comes to Washington from a suscessful career where he is State's Attorney in the southern district of New York, to be the Special Inspector General for TARP (Troubled Asset Relief Program); he's on the inside in firs...more Remember the Financial Crisis of 2008? Remember how they told us the entire global financial system could have melted down? Current affairs, government insiders, and more bad news about how your tax dollars are spent shoring up the wealthy of Wall Street and the mega-banks. Barofsky comes to Washington from a suscessful career where he is State's Attorney in the southern district of New York, to be the Special Inspector General for TARP (Troubled Asset Relief Program); he's on the inside in first a Republican and then a Democratic Administration. His lack of insider "street smarts" for Washington in the beginning is a bit comical and he is not above pointing out how "green" he was. He's apparently a quick learner. If you have high blood pressure or any other medical condition that might be worsened by the overwhelming urge to throttle some of those suits at the top, I would suggest you avoid this book. The pettiness of some of the Administration officials he has to deal with are infuriating. If you have a keen interest in affirming your suspicions that the country is becoming a plutocracy with each passing day, you will find much material here to bolster your position. Barofsky was in a bird's-eye position, and as he sees it there was almost a callous disregard for the plight of the middle class who had mostly been harmed by the actions of greedy financial execs. You would think that the sheer hubris that came to light about the greed of the sub-prime mortgage lenders, along with Wall Street and with some of the "too big to fails" like AIG would create a groundswell and demand justice for all those work-a-day Americcans that fell into holes created by the housing bubble, the foreclosure crisis. the 9 million+ jobs lost, etc. Some of the accounts the author describes of the junior-high type rumor-mongering and back-biting of working in the Administration in Washington is at turns either hilarious or pathetic and disspiriting. The descriptions of Washington kow-towing to big money may enrage some, which I gather was part of the impetus for writing the book. The "fixes" designed to alleviate the plight of struggling homeowners have resulted in a "drop in the bucket" effect for a lucky few, while many others have been needlessly and shamefully harmed by unscrupulous servicers. The relief measures advocated by the Treasury Department have been almost all concentrated on rescuing the banks, even though there was a public pledge of helping those homeowners whose mortgages could be modified to keep them in their homes. Barofsky distributes praise and credit to those (few and far between, apparently) tireless public servants who really do believe they can do some good for the average American. He points out that the role of big money is systemic in the political system of our modern democratic republic and asserts that as long as that's the case, little will change. There is a revolving door between Washington and Wall Street, which is putting our country on a fast track to the plutocracy our Founding Fathers sought to avoid. The "fixes" instituted by the Treasury Dept. have hurt the middle class but rewarded the ultra-rich, with the largest banking institutions becoming even larger and commanding a whopping $8.3 Trillion in assets between them--while at the same time the percentage of Americans living in poverty has Increased. I would highly recommend.(less)

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Sep 11, 2012 Ray rated it 4 of 5 stars · review of another edition

"Bailout" provides an excellent review of the huge bank bailout program initiated by the Government at the end of 2008. Neil Barofsky was the special inspector named to prevent fraud in the Troubled Asset Relief Program (TARP), and his accounts are clear, insightful, and non partisan. Much of his criticism was directed at Tim Geitner and the Treasury Department, but he pointed out many others to blame as well.
It was frustrating to hear again how banker greed led to the financial collapse of the...more

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Jul 30, 2012 Marcia rated it 5 of 5 stars

What an articulate,interesting, and well-written book about the TARP bailout which affected every person in the US as well as generations to come! Geithner and other bankers were so arrogant that they thought that the problems and big finance were too complex for ordinary people to understand. Wrong! Barofsky explains the basic problems and gives examples of the problems with TARP and other federal goverment programs. He contends that the programs were good ideas but did not contain enough speci...more

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Aug 19, 2012 Dan Petegorsky rated it 3 of 5 stars

The is an important book, and Barofsky has now been hitting the talk show circuit and writing op-eds and blogs underscoring his message: namely, the degree to which the Treasury Department and federal agencies have, by focusing almost exclusively on rescuing the biggest banks, failed to rescue homeowners, hold the banks accountable for having crashed the economy, and take steps to prevent future catastrophes.

These points do come across strongly in the book – but the format (a memoir-like accoun...more

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Jan 14, 2013 Donald Morris rated it 4 of 5 stars

Barofsky was the Special Inspector General in charge of TARP, the Troubled Asset Relief Program. TARP was the government's response to the financial crisis that shook the international economic structure in the fall of 2008. Barofsky's first-hand account tells the story of his attempts to remain independent of politics and warn Congress and the Treasury of potential fraud in the distribution of the billions of taxpayer dollars targeted initially at helping homeowners but quickly redirected to he...more

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Dec 28, 2012 Dawn rated it 3 of 5 stars

Neil Barofsky was able to take a complicated matter (TARP, CPP, TALF, HAMP) and "dumb it down" for the average American. In doing so, he was able to convey his frustration and anger over the way Washington treated taxpayer money during the recent bailouts.
There were several passages in this book that really stuck with me. One was the story of the pool-company owner in California who looked to the HAMP program in order to save his company and home. The story of the ensuing "run-around" was sad an...more

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Feb 28, 2013 Nathan rated it 4 of 5 stars

Shelves: on-the-kindle, read-2013, 4-plus-stars

Recommended by Jon Stewart.

What surprised me most about this book is it was so easy to read, a step by step personal tour of a key witness to the financial system bailout debacle. Who knew TARP, HAMP, PPIP and a suite of other acronyms could be so easy to understand.

What surprised me most about the subject was the clarity the book brings to the failures of the bailout process, and the risks to the global economy in refusing to tackle the mentality of 'too big to fail'.
Bailout identifies where th...more

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Apr 03, 2013 Mike rated it 5 of 5 stars

Shelves: favorites

There are so many books to read with different perspectives on the financial crisis, and having read several, this stands out. Neil Barofsky left the US attorney's office for the southern district of NY for a startup job in DC overseeing TARP. His goals of protecting against fraud, holding banks accountable, and attempting to have the money used to help actual homeowners are not shared by anyone at Treasury, the implementers of TARP.
There is a short list of good guys, and most of them are good...more

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Mar 25, 2013 Dekks rated it 3 of 5 stars

I read this because someone recommended it as a great look at the inner workings of D.C and the bailout but done in a very engaging and humorous way. As a complete lay person when it comes to economics, I found it very interesting to begin with and couldn't believe the lack of oversight for billions of dollars, but found after the first half of the book it started to become a bit too bogged down in technical detail.

My other criticism is that the author comes across as a bit too self important, t...more

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Mar 10, 2013 Uwe Hook rated it 4 of 5 stars

In "Bailout", Neil Barofsky has contributed one of the more readable and focused critiques of Washington's response to the financial meltdown of the housing industry. As the first special inspector general for the Troubled Asset Relief Program (TARP), Barofsky brought a prosecutor's sensibility to the job, as well as a good understanding of the underlying motives (mostly greed) that led to the collapse of an important industry. His frustration with the Treasury Department's sweetheart relationsh...more

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Aug 21, 2012 Ken rated it 3 of 5 stars

This review has been hidden because it contains spoilers. To view it, click here.

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Mar 05, 2013 Erik Graff rated it 4 of 5 stars Recommends it for: US citizens

Recommended to Erik by: Erik Badger

Shelves: political-social-science

This distressing book, authored by the former Inspector General in charge of overseeing the Troubled Asset Relief Program that followed our last depression, is easier to read than one might think, Barofsky nesting his discussion of economic issues in an engaging narrative description of his years in Washington, D.C.

What one learns, overall, is that national politics is substantially dominated by the largest financial institutions. This was as true during the Bush administration as during Obama'...more

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