What does a bank do after it takes billions in TARP funds and then fails its stress test?
Why, sponsor a multimillion dollar environmentally friendly bike share program. Naturally.
Citigroup, who was the recipient of over $476 billion dollars of taxpayer bailout money, has joined forces with the City of New York to sponsor a $41 million dollar bike share program.
The "Citi Bike" program will offer 10,000 bikes branded with the bank's logo at over 600 locations in Manhattan and surrounding boroughs. Of course, the city will also have to build and install the brand new solar-powered docking stations first to accommodate the TARP getaway bikes that will soon be flooding New York City streets.
Citigroup CEO Vikram Pandit says that he hopes the program will provide a "sustainable option to help people navigate the city" that would ultimately result in less gridlock and crowding on New York's public transportation systems. Though somehow, the idea of setting thousands of tourists loose on government-owned bikes onto the streets of Manhattan seems like a counter-intuitive plan for reducing the city's traffic woes.
Mayor Michael Bloomberg says the program will operate at no cost to the taxpayers, but that claim is laughable considering the billions taxpayers pumped into the too-big-to-fail bank following the 2008 financial crisis.
So is this the wisest expenditure of bailout money? I think most consumers would prefer Citigroup to pay back their debt or lower ATM fees over bikes, but you can be the judge of that.
Editor's note: To make matters worse Reuters blogger Felix Salmon says the bike share program is expensive at $10 per day:
The $10-per-day cost is already a significant expense: that’s four subway rides right there. And then the hourly charges really start to rack up if you keep the bike for some length of time. If you take the bike around Governor’s Island, for instance, and stay there for a couple of hours, you’re likely going to end up in the 3-hour time bracket, which is $49. On top of your $10 daily rental. As Garth Johnston puts it, for any real let’s-bike-around-the-city plans, you’re definitely going to be better off just buying your own bike.