Political Interference Seen in Bank Bailout Decisions - WSJ.com

Troubled OneUnited Bank in Boston didn’t look much like a candidate for aid from the Treasury Department’s bank bailout fund last fall.

The Treasury had said it would give money only to healthy banks, to jump-start lending. But OneUnited had seen most of its capital evaporate. Moreover, it was under attack from its regulators for allegations of poor lending practices and executive-pay abuses, including owning a Porsche for its executives’ use.

Nonetheless, in December OneUnited got a $12 million injection from the Treasury’s Troubled Asset Relief Program, or TARP. One apparent factor: the intercession of Rep. Barney Frank, the powerful head of the House Financial Services Committee.

Mr. Frank, by his own account, wrote into the TARP bill a provision specifically aimed at helping this particular home-state bank. And later, he acknowledges, he spoke to regulators urging that OneUnited be considered for a cash injection.

More evidence that the “bailout” has become what all of us here anticipated - a giant unaccountable slush fund, used to favor incompetent but politically connected “winners” at the expense of those of us who still believe in thrift and hard work. Thanks a bunch, GWB, for putting the GOP imprimatur on this wholly predictable clusterfuck. You’ve got to be the only one in Washington who didn’t know precisely what Barney Frank, Chris Dodd, and their pack of rabid hyenas on the Banking committees were going to do with your “emergency bailout.”

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