Banks took out government loans (bailouts), but have paid most, if not all, of that money back. The incentive for the banks was to become more financially stable fast to get the government off their backs. The benefit to the fed was as long as they kept the pressure on the banks to show a profit, the people's investment would be secure and the fed would eventually get their money back and could possibly even make a profit is the financial instruments they took back increased in value.
GM/Chrysler benefits because they were able to remain in business via government loans. At first, I advocated letting them fold as well, but once I started looking at the "domino affect" this would have created across other distribution and commercial sectors, I realized it was smarter to bail them out than to let them fail. Now, granted, through some creative financing GM and Chrysler have been able to pay back their gov't loans. Still, it was in their best interest to do so for the exact same reason it was for the banks - "the sooner we can pay back the government, the sooner we get the government off our backs". And for the government (People), the benefits were the same...turn GM/Chrysler back to profitability soon so that they could buy back their stocks/bonds, etc., or allow same to turn a profit and sell them on the open market. Either way, the government's only risk was if the banks and the U.S. auto industries didn't turn a profit. By all accounts, they seem to be doing fine now.
AUSTAN GOOLSBEE: I think the world vests too much power, certainly in the president, probably in Washington in general for its influence on the economy, because most all of the economy has nothing to do with the government.