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Who Lost in Financial Crisis? Ordinary Americans

After 10 years, it’s difficult to view the bailouts as anything other than a massive wealth transfer from ordinary Americans to financial firms.

By Nir Kaissar | Updated on September 13, 2018
Transfer of wealth.

A decade after the collapse of Lehman Brothers Holdings Inc., there are still arguments about who was responsible for the 2008 financial crisis. But it’s also worth revisiting who paid for the crisis and who profited from it.

Any discussion about winners and losers, of course, must start with the bank bailouts. The centerpiece of that rescue was the Troubled Asset Relief Program, or TARP, an October 2008 federal law that authorized the U.S. government to “invest” in banks and their toxic mortgage-related assets. The U.S. Treasury invested $426 billion and ultimately recovered $441 billion when TARP ended in December 2014.

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