The news that the huge government bailout of the banking sector has turned into an enormously costly mess will surprise nobody smarter than Matt Yglesias, but the details are worth pointing out:

The federal bailout for Fannie Mae and Freddie Mac could more than double in size during the next three years, according to projections from the companies’ federal regulator.

Fannie and Freddie, the federally-controlled mortgage finance giants, will likely need at least another $73 billion and perhaps as much $215 billion from taxpayers in the next three years to meet their financial obligations, the Federal Housing Finance Agency said.

You mean, having the Federal Government buy up enormous piles of underwater and fraud mortgages with no oversight, intentionally paying far more than they’re actually worth, might be *costly*?

Nah!

Dday hits the nail on the head here:

Quick question: Where are the Fannie and Freddie losses coming from? Answer: bad loans they bought. Quick question: Where did the bad loans come from? Answer: the banks.

I love this line in the piece: “The projections of additional bailouts for Fannie and Freddie are in sharp contrast to recent discussions by the Obama administration about how the bank rescue known as the Troubled Assets Relief Program, originally valued a $700 billion, is expected to cost taxpayers less than a tenth of that.” Yeah, there’s a reason for that “contrast.” It’s because the losses of TARP are being realized in Fannie and Freddie.

Here’s how this worked: the vast majority of the actual bank bailouts didn’t occur in TARP; it occurred through a wide array of other special programs that shoveled money onto banksters’ books or took off toxic garbage from those same books, along with accounting trickery like ending mark to market. (Dday pointed out some of this in an earlier piece, along with the fact that the AIG losses we’ve had to pay should count against the ‘profit’ from TARP, that a no-strings attached bailout now encourages more recklessness in future, etc)

Not that this entirely predictable turn of events will trouble Matt Ygelsias, who claimed that TARP would have a ‘negative cost’ to government. Right. Negative tens, perhaps hundreds of billions, Matt?

Or DougJ at Balloon Juice (motto: If We Say It’s Sunny, Please Bring Your Umbrella), who said of TARP (while adding a small proviso about AIG losses):

It didn’t cost $700 billion either, in the end, it’s pretty close to break even. Yeah, they should have settled AIG’s credit default swaps for 60 cents on the dollar (or something like that), but it wasn’t a pointless $700 billion give-away to fat cat bankstas.

Or Mistermix at BJ, who today was trumpeting the entirely fictional 8.25% rate of return on the bank bailouts while asking if, considering the enormous, Earth-shattering risks we took on to bailout Wall Street, perhaps we should have gotten slightly more cash.

Once again I can say I was right on this issue early thanks to Ian Welsh, who kindly took the time to explain, way back in August of 2009, why TARP’s ‘profits’ were and would always be nothing more than accounting sleight of hand:

TARP is making money because it was decided that it had to make money. So instead of forcing banks to take losses, or withdrawing special loan facilities, or ending concessionary rates, or making banks retire guaranteed bond issues and reissue them without the guarantee the banks were encouraged to “repay” TARP.

But if you think that means that the overall panolpy of government aid to banks was profitable, you aren’t looking at the whole picture. It’s like making 5 loans to your deadbeat cousin, and he pays back one while not being able to pay back the others and you say “I made a profit!” Not yet.

But I’m sure Bernanke and Geithner are pleased that so many folks have fallen for their shell game.

There’s a sucker born every minute, and half of them grow up to shill for Obama.

This story from the NYT would warm my black heart if I thought for a nanosecond that those half-wits in the Administration would learn anything about making deals with jackals from it:

WASHINGTON — The Justice Department sued Blue Cross Blue Shield of Michigan on Monday, asserting that the company, the state’s dominant health insurer, had violated antitrust laws and secured a huge competitive advantage by forcing hospitals to charge higher prices to Blue Cross’s rivals.

…

In the Michigan case, the Obama administration said that Blue Cross and Blue Shield had contracts with many hospitals that stifled competition, resulting in higher health insurance premiums for consumers and employers.

…

The lawsuit took direct aim at contract clauses stipulating that no insurance companies could obtain better rates from the providers than Blue Cross. Some of these contract provisions, known as “most favored nation” clauses, require hospitals to charge other insurers a specified percentage more than they charge Blue Cross — in some cases, 30 to 40 percent more, the lawsuit said.

Christine A. Varney, the assistant attorney general in charge of the antitrust division of the Justice Department, said these requirements were “pernicious.”

Yes indeed, after betraying the American people and signing a corporatist takeover bill that taxes you to line the pockets of big insurers if you can’t afford their lousy product, the Obama administration is waking up to the fact that they are in bed with some of the most evil people on the planet, running a system of mass murder that would make most brutal third world despots green with envy.

It was so important for Obama to protect an industry that kills 45,000 Americans a year. Yes sir.

If there is, by some shockingly remote chance, a hell, Obama’s personal punishment should be to suffer an agonizing disease for all eternity while forced to fill out paperwork to desperately beg for medical treatment that his HMO refuses to provide. Perhaps due to cost? Who can say.

There’s been a lot of hubbub in the last few weeks over DADT. Central District of California Judge Virginia Phillips issued an injunction against the policy worldwide, probably overstepping her authority to do so; recently she denied a stay of her ruling, forcing the Defense Department into an awkward position, which they are dealing with by admirably complying with the ruling and accepting, for the moment, the openly gay applicants that they should have taken all along.

Legally a messy situation, but policy wise, a real step forward.

Naturally, being the enemies of sound policy, the Obama Administration has appealed to the 9th Circuit, and their appeal is a humdinger too. Instead of merely arguing over the technical merits of Phillips’ worldwide injunction, they mounted a spirited defense of the constitutionality of DADT, an inherently discriminatory policy that turns gay Americans into second-class citizens:

What is very troubling, however, is that the Administration, by and through the DOJ never – never – indicates that it considers DADT to be unconstitutional on its face. Every objection by team Obama is in favor simply of study and legislative repeal; and, in fact, they doggedly protect the constitutionality of DADT. There is a HUGE difference between the two concepts of saying it is simply something that should be fixed by Congress (increasingly unlikely, it should be added, in light of the massive gains conservative Republicans are poised to make) and saying the Administration fully believes the policy unconstitutional and invidiously discriminatory (the position Obama blatantly refuses to make).

It should also be noted that a refusal to acknowledge the fundamental constitutionally discriminatory nature of DADT is also entirely consistent with the recent history of Obama Administration conduct and statements on the issue. Whether it be Obama himself, official spokesman Robert Gibbs or Valerie Jarrett, every time the direct question on constitutionality of DADT is raised, it is deflected with a flimsy response framed in terms of Congressional repeal. At this point, you have to wonder if Barack Obama and his Administration even consider the blatant discrimination of DADT to be of a Constitutional level at all; the evidence certainly is lacking of any such commitment.

This comes a week after top Obama adviser Valerie Jarrett referred to being gay as a ‘lifestyle choice’… while discussing the tragic suicide of a bullied teenager no less.

Keep in mind that President Obama is a steadfast opponent of equality for gay Americans in other arenas as well, consistently opposing gay marriage on religious grounds:

In his bestseller, The Audacity of Hope, Obama, now a U.S. senator, explains his support for civil unions, again mentioning religion and noting the strategic problems that the push for gay marriage poses:

For many practicing Christians, the inability to compromise may apply to gay marriage. I find such a position troublesome, particularly in a society in which Christian men and women have been known to engage in adultery or other violations of their faith without civil penalty. I believe that American society can choose to carve out a special place for the union of a man and a woman as the unit of child rearing most common to every culture. I am not willing to have the state deny American citizens a civil union that confers equivalent rights no such basic matters as hospital visitation or health insurance coverage simply because the people they love are of the same sex–nor am I willing to accept a reading of the Bible that considers an obscure line in Romans to be more defining of Christianity than the Sermon on the Mount. …The heightened focus on marriage is a distraction from other, attainable measures to prevent discrimination and gays and lesbians. (pp. 222-3)

Well, since running for higher office, anyway. When he was a younger man, and a less ambitious politician, he at least claimed to hold diametrically opposed views, favoring gay marriage.

Let’s call this what it is. If President Obama opposes equal rights for gays and lesbians because of his religious delusions, then he is a bigot and a closet theocrat. If he’s opposing their equal rights out of mere political expediency, then he is a hypocrite, a liar and a coward, giving comfort to bigots.

Either way, he’s a disgusting excuse for a public figure.

It is preposterous beyond words to sit back and allow him to pass himself off as some sort of moderate while he uses religious fanaticism to publicly justify depriving gay Americans of their equal rights, and refuses to take simple actions entirely at his discretion to stop persecution of American citizens based on their sexual orientation. It is sycophantic beyond belief to point at the minority party in the Senate and act as if it was their nefarious schemes that prevented Obama from stopping DADT, or somehow forced him to make bigoted statements about gay marriage based on his hokey sky-god religion. Obama got into this mess on his own, by reversing his earlier position and by pushing delay after delay instead of acting to defend the Constitutional rights of his own citizens.

He could end DADT today, at least in terms of implementation. He does not, contra his repeated assertions, have to enforce a law that is unconstitutional on its face, and he certainly doesn’t have to vigorously appeal to protect the assertion of its Constitutionality. He could stop trying to insert religion into the public sphere on gay marriage.

He could also hire some advisors who aren’t so gobsmackingly stupid as to defame a dead teenager for his ‘lifestyle choice’ while he’s at it.

So the question becomes: does Obama really believe that gay Americans deserve to live as second-class citizens because of some badly translated Iron Age superstition? Or does he believe that they should live that way to serve his political ends?

Or, perhaps, both?