Fact-checking the weekend's GOP debates

Source: CBS

Ron Paul cited a staggering number in the Republican presidential debate Sunday - $15 trillion supposedly spent by the Fed "bailing out their friends." Like Mitt Romney and his claims about creating jobs in the private sector, Paul came up with that shocker by presenting an unbalanced look at balance sheets.

Here is a look at some of the claims in a pair of lively GOP debates on the weekend and how they compare with the facts:

PAUL: "I don't see how we can do well against Obama if we have any candidate that, you know, endorsed, you know, single payer systems and TARP bailouts and don't challenge the Federal Reserve's $15 trillion of injection bailing out their friends."

THE FACTS: First, there are no fans of government-run, single-payer health insurance in the Republican field, despite Paul's suggestion otherwise Sunday. Newt Gingrich once endorsed the idea of requiring everyone to have health insurance, and Romney introduced a mandate for health coverage as Massachusetts governor. But that's a far cry from a Canadian-style health system that makes government the primary payer of people's medical bills.

TARP is the $700 billion Troubled Asset Relief Program that was proposed by President George W. Bush and passed by Congress in 2008 to help rescue imperiled financial institutions. Nearly all of the money has been paid back, with interest.

Paul's slam against the Fed ignores the fact that most of the $15 trillion he is talking about involved loans that were quickly repaid, sometimes the next day. And that's if these Fed transactions can even be considered loans in the conventional sense.

When the Fed lends money to banks, it creates the money out of thin air. When the banks pay it back, the money disappears from the system. If a bank borrows $5 billion from the Fed one day, then pays it back the next, and a week later borrows $5 billion more and quickly pays it back, the total would be listed as $10 billion, even though it's just the same money going back and forth and the treasury is in no sense being emptied.

That's how a federal report counted a running total of about $15 trillion in emergency Fed loans to domestic banks and their foreign subsidiaries between 2007 and 2010. The actual loan total, once paybacks are accounted for, is estimated at $1.1 trillion.